Forfás pays out €4.7m to rent empty premises

A State agency has paid almost €5m in rent on vacant space in the past five years on a building that it is unable to sub-let to others.

Forfás is tied to a 65-year lease on Carrisbrook House in Dublin 4, and the Minister for Jobs, Enterprise, and Innovation, Richard Bruton, has confirmed that the agency has paid out €4.7m in rent for the Ballsbridge premises since 2008.

In a written response to Sinn Féin’s Peadar Tóibín, Mr Bruton confirmed that Forfás paid €990,000 last year on the vacant space, also stating that there is no provision for lease breaks on the property, which is subject to upward-only, or equal, rent reviews.

The €990,000 represented 15% of the agency’s staff costs of €6.7m that year.

Between now and when the lease ends in 2034, Forfás — which acts as Ireland’s advisory board for enterprise, trade, science, technology, and innovation — faces paying out over €20m.

The agency has been endeavouring since 2008 — when previous tenants vacated the building — to sublet the vacant space, but to no avail.

Currently, only one floor of the eight-storey building is let, and that is to the Israeli embassy.

Developer Bernard McNamara, through Mazarone Ltd, acquired the building for €46m and it was put on the market last September for the receiver to Mazarone at a guide price of €15.5m.

The attractiveness of the no-break, upward-only rent review lease, with the guaranteed rent roll, meant the property was only on the property market for three months before it was snapped up in December.

A spokeswoman for DTZ Sherry Fitzgerald declined yesterday to say who bought the building, or for how much, only to confirm that the price exceeded the guide price of €15.5m.

On the reorganisation of the State’s industrial agencies, Forfás acquired responsibility for the leasehold in 1994.

A spokeswoman for Forfás said yesterday: “Every effort has been made to seek replacement tenants or to dispose of the leasehold interest.

“Working with professional estate agents, a number of marketing initiatives have been undertaken since 2008 and are ongoing.”

The agency confirmed that, during 2011 and 2012, there were a total of 12 viewings of Carrisbrook House.

Mr Tóibín said last night: “This Government had promised to deal with this issue of upward-only rent clauses. We now find that a government enterprise agency is caught up in one of these leases and is paying well over the odds for renting vacant premises.

“There is a need for the Government to end these excesses payments to landlords and save the taxpayers’ money.”

© Irish Examiner Ltd. All rights reserved

More in this Section

Cavan murder-suicide: Bishop says Castlerahan community will unite in face of family horror

50 soldiers sue over malaria medicine

State inquiry into ‘Grace’ case moves a step closer

Apple tax issue may end the coalition romance


Breaking Stories

Government to decide on appeal of €13bn Apple tax ruling at emergency cabinet meeting

Lifestyle

James Nesbitt and Hermione Norris on why the time is right for the return of Cold Feet

Get a Fair Deal with costs of care homes for elderly

Pablo Escobar’s life on the line in Narcos season two

How to buy the perfect laptop for college

More From The Irish Examiner