Eircom Superannuation Fund is to avail of the buoyant investment market to sell two prime office blocks in Dublin and Cork and a retail investment at 1 Henry Street in Dublin.
A number of institutions and private investors are likely to pitch for the three properties, which are let on long leases to strong tenants. Agents Druker Fanning & Partners, advisers to the Eircom Superannuation Fund, are not providing guide prices for the investments which are to be sold by tender on October 20th in either one, two or three lots.
However, it is thought likely that Canada Life House, a modern office building in Blackrock, Co Dublin, will make in excess of £9 million. Such a price would produce a yield of around 6 per cent on the block, which is rented at £553,113 per annum. The Eircom Building, at Lapp's Quay in Cork, rented at £175,000 a year, is expected to make over £2.5 million (equating to an initial yield of 7 per cent) while 1 Henry Street in Dublin, recently let to jewellers H Samuel at an annual rent of £170,000, should fetch over £3 million. That price would provide a yield of 5 per cent.
The three properties are among the most interesting to have come on to the market since last October when the same agents, Druker Fanning, sold five investment properties, including two at the bottom of Grafton Street, for Royal Liver Assurance Company.
The immense shortage of prime investment properties over the past few years has forced most institutions to switch their attention to office and retail developments, mainly in the Dublin suburbs, where they have had to compete to pre-fund these ventures.
The Eircom fund is one of the most active investors in Ireland with managed funds of over £1.7 billion, of which £620 million is invested in Irish companies, Irish Government stocks and the local property market. The fund is acknowledged as one of the most astute players in the commercial property sector, frequently moving fast to prefund developments. Last year, it pre-funded the retail warehousing at Liffey Valley Shopping Centre in west Dublin and the Pavilions Shopping Centre in Swords. Both projects involved a combined investment of around £130 million.
The decision to sell the two office blocks and the Henry Street store forms part of a rebalancing of the portfolio.
The five-storey over lower ground floor Canada Life House occupies a high profile location in Blackrock and dates from 1984. It has a floor area of 26,925 sq ft and 55 car-parking spaces on the lower ground floor. Canada Life Assurance Company occupies the block on a 30-year full repairing and insuring lease from 1995. The rent was recently reviewed.
The Eircom building in Cork is located in the heart of the central business district close to the South Mall and directly opposite the City Hall. The six-storey over ground floor office block has a floor area of 25,668 sq ft and dates from 1980. Eircom plc holds a 35-year lease from 1981 subject to five-yearly upwardsonly rent reviews. The ground floor showroom is used as a telesales centre. The current rent of £175,000 works out at £6.80 per sq ft and will inevitably show a significant increase when the next review takes place in May, 2001.
Number 1 Henry Street is located along one of the best trading pitches on the street, directly opposite Roches Stores and the Ilac Centre. The three-storey over basement building at the junction of Henry Street and Upper Liffey Street has retail use at basement, ground and first floor levels and offices and stores on the top floor. The 3,146 sq ft building was let from last June to Signet Group plc for its H Samuels trading division. The 25-year lease provides for five-yearly upwards-only rent reviews.
