The huge appetite among private investors for acquiring retail buildings in Dublin’s south inner city is continuing to trigger further sales of what have always been seen as long-term investments.
The latest and most appealing property to reach the market for some time is Exchequer Chambers, a distinctive Victorian five-storey over-basement building on Exchequer Street. It includes four shops, overhead offices and apartments.
Nigel Kingston of Douglas Newman Good Commercial is seeking offers in excess of €7.5 million for the portfolio, which is producing a rental income of €433,563 . That figure is due to rise to €466,063 by this time next year.
Several equally well-located buildings in the same area have been snapped up in recent weeks, none more prominent than the Victorian-style former Dockrells hardware store at the junction of South Great George’s Street and Lower Stephen Street, which was sold for just above the €6 million guide price, a long way from its €17 million purchase price eight years go.
Exchequer Chambers has been owned since about 1994 by the same two investors who bought it for about €1.6 million. By then the original large ground-floor store occupied by the household goods retailer Nicholls had been divided into four separate shops.
It was one of a number of streetscapes in the same area which were offloaded at about the same time by Dublin City Properties, then fronting the Merchant Navy Pension Fund.
Island site
The largest part of the sell off was the adjoining South City Markets covering an island site with about 50 buildings fronting on to South Great George’s Street, Fade Street, Drury Street and Exchequer Street.
Most of the buildings were sold individually in 1992 for an overall figure of about £6 million when none of the funds showed any interest in the block.
The remainder of the portfolio was eventually absorbed into Green Property Company which, surprisingly, sold it on before values soared.
Investors considering pitching for Exchequer Chambers will be aware that pedestrian traffic along Exchequer Street has grown rapidly in recent years because of the improved retail offering on the street, not least from a variety of fashion outlets, new restaurants and the food market Fallon and Byrne.
Eircom
That premises was originally used as a telephone exchange by Eircom, which still owns property in the area, including a substantial site at the rear of Exchequer Chambers; this will inevitably be sold at some time in the near future and could well end up in retail use.
Investors interested in Exchequer Chambers will consider upgrading much of the block and possibly installing a lift to service the upper floors.
Eircom's lease of more than 557sq m (6,000sq ft) on the upper floors runs out next year, a second lease by Brooks Hotel has expired, and the four apartments on the top floor are subject to 12-month leases.
Top-class investment
The timeframe could not be better for an investor who wants to turn the block into a top-class investment. All four shops have floor areas of 66-88sq m (714-923sq ft) and even larger basements. Number 19, Itsa Bagel is paying a rent of €45,000, which is due to rise to €60,000 in June 2016.
De Stafford Manufacturing Ltd pays a rent of €61,000 for No 21; Petit Bambino pays a rent of €75,000 for No 25; Boulevard Café pays a rent of €75,000 for No 27, which is due to revert to €92,500 in June 2016.
