A dead year with some room for irony on the commercial market

THE house market might have been on the floor in 2010 — but, if it was, the commercial end of the business was in the basement by comparison and, unlike the stamp duty break given to the residential market in Budget 2011, it still has a high tax rate on transactions.

There was hardly a deal worth a mention, in Munster at least, to stir the pulses.

The years before the Big Bust saw bank branches and investments dangled like carrots, and the main banks sold bundles of their own bank/HQ properties for hundreds of millions — guess who saw the writing on the wall? Them, clearly, in hindsight, along with a miniscule coterie of economists and a certain small west Cork farmer who’s entitled to say “I told you so...” That’s another story, though.

However, a single bank branch purchase on Cork’s city’s St Patrick Street was probably the biggest investment deal in Munster in 2010. The Quintas Group bought the AIB branch next to Penneys for pension clients, for €9.36m.

Quintas’ Kenny Kane said it equates to about 40% of its peak value in 2006, and will give a c 7% return which will cover both interest on the loan, and capital reductions. It was bought via investor equity and bank finance, and AIB will remain on a 20-year lease.

This was also the year when First Active plc disposed of most of its 49 bank branch premises, but the total was in the realm of tens of millions — peanuts, almost.

In Dublin, the top bar/hotel sale was Chief O’Neill’s in Smithfield, selling for €8.5m, probably the first decent hotel sale in two years. It stayed on its own, though, and by later on in 2010 some Irish hotels in secondary locations were being offered for sub-€1m sums — remember when the country didn’t bat an eyelid at suburban houses making that and more?

In Waterford city, the bar and nightclub complex Ruby’s and Muldoons was sold for over €4m — also showing a slide in value by about 60%, as it previously changed hands in 2005, for €9.25m.

In Cork city’s suburbs, the Ardmanning bar changed hands in the sub-€4m category, picked up via a company acquisition by owner of the neighbouring SuperValu Liam Ryan, who plans a €10m investment on the site.

In the rest of Cork city, there was hardly a bar sold due to a dearth of bank funding and lack of general business confidence — but pub leasing became more common. Lease deals were done on the Woodford and at Clancys. A new bar/restartaurant did, however, open in a c €3.3m investment: ironically, or otherwise, in a former bank premises, the old ACC building on South Mall, now trading well as Electric.

Its success contrasts with the changed fortunes of the Bank Restaurant and Bar in Limerick, which went up for sale via a receiver in September complete with a section called Rogue Traders after Nick Leeson, whose sins with Barings bank (he cost them €1 billion, give or take) look like small change by comparison with our own clever bankers.

Ironies lie thick on the ground (especially around the South Mall) after several years of sluggish market trading. As auctioneers feel the pinch, one long-established estate agency premises is now reopening as national housing association Helm’s Munster offices. Helm oversees the letting of more than 5,000 affordable houses to rent.

One of the very few commercial/industrial property deals of the year past was the €1.25m sale of the 12,000sq ft former Modern Plant premises, on an acre in Togher. It was bought by the Cork Muslim Society, and will be turned into a mosque, community centre and classrooms.

The 1970s food plant Swissco in Little Island found a buyer after it closed this year. It was bought off market for around €3m by next-door concentrate manufacturing plant neighbours Pepsico, via Lisney.

Office deals were thin on the ground. The main movers were Siemens, relocating to Mahon, and Eli Lilly moving into the old McAfee building in Little Island.

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