One of the most valuable commercial properties presently on the market in Dublin may be providing one of the most accurate insights into the true health of the market in 2012. St Martin’s House at the intersection of Waterloo Road, Upper Baggot Street and Pembroke Road in central Dublin has been on the market with an asking price of €37.5m. It is a 76,000 sq ft 1960s refurbished office/retail block plus 156 car-parking spaces. The property is multi-tenanted and presently taking in €3.6m per annum. So on the face of it, a yield of just under 10% is suggested by the asking price. Savills is marketing the property and sales details are here.
Sources say that contracts had been issued at €28m, suggesting a 12.7% yield but even at this rate of return, the sale appears to have fallen through. The schedule of tenancies in the sales brochure suggest office rents of €40psf which is probably €15 psf above current market levels. Leases expire between 2016-2027. There is a mix of office tenants that includes reportedly-NAMAed Spain Courtney Doyle, about whom the brochure notes “Spain Courtney Doyle is a private limited company and have not published latest accounts for a credit score to be available.” As reported on here in April 2012, Spain Courtney Doyle now appear to have a London address, and one of the founders Bernard Doyle declared bankruptcy in the UK last month.
The building is understood to be owned by Treasury Holdings which is in the wars with NAMA at present, though it is not clear if this building is associated with any NAMA lending. [CORRECTION: 19th June, 2012. The building is in fact now wholly owned by Friends First Managed Pension Fund Limited and managed on its behalf by F&C Reit]
Savills hasn’t commented at time of writing.
UPDATE: 19th June, 2012. For the avoidance of any doubt, the selling agents advise that the leases/tenancies are fully performing.
UPDATE: 9th January, 2013. Jack Fagan reports in the Irish Times today that the property has now been sold to two unidentified German businessman, introduced by Davy, who paid €22.5m for the 75,000 sq ft property comprising retail and office space. Jack says this represents an initial yield of 13.26% but if the rent is still €3.6m, then I make the €22.5m price equivalent to a yield of 16% exactly.