The sale of a 16,000 sq ft office, at nos 5 and 6 Lapps Quay, let to Deloitte, concluded at the end of September to a low-key investor, an Australian living in Hong Kong who has other Irish investments.
The Lapps Quay property was developed by O’Flynn Construction and has two floors leased to international accountancy firm, Deloitte, who are paying an annual rent of €422,000, on a 20-year lease from 2005.
The acquisition ticked all the boxes for the buyer, said IWI managing partner, Richard Coffey, a Bantry native and former Irish Army officer — he said the approach was down to teamwork, with Davy, as investment managers, Northern Trust, and Maples and Calder for legals.
IWI has been active in acquiring and managing blue-chip assets for international and Irish investors, said Mr Coffey, and he was delighted to bring investors to locations out of Dublin.
“Hopefully, it will be a sign of things to come. Obviously, Dublin has the profile, but this is an endorsement and vote of confidence for Cork,” Mr Coffey said, noting this deal had a blue-chip tenant, on a long lease, in a quality building and city location.
He said the yield was more than 10%, and his company saw openings in blended Irish investments, mixing Dublin investments with circa 7% yields, with higher yields on buys outside of the capital, for an overall 8-9% return.
Margaret Kelleher, of Lisney, and Niall Guerin, of Savills, were the joint selling agents for the Lapps Quay property, which had received a higher offer from another investor, but that transaction wasn’t completed, leaving the door open for IWI’s client, in March. Ms Kelleher said the sale “proved to be an attractive investment property to the market, with a quality tenant and long-term lease in place.
“Interest in the investment was wide-ranging, from local investors to overseas investors with Cork connections.”
She said the sale price indicated an initial yield of 10.1% and an equivalent yield of circa 7.75%. Mr Guerin said the Dublin investment market was very hot, with lots of competitive bidding, and that opened opportunities for better-value investments in places like Cork.
Location is opposite Cork City Hall and neighbouring occupiers on the quay include Bord Gais, Sherry FitzGerald, DTZ, Fitzgerald Solicitors and The Waterfront Business Centre.
“Foreign investors and international funds are now looking to Cork, as the city has a number of strategic advantages that continue to be translated into further opportunities for growth and development. The city has a thriving commercial, social, and cultural sector that has a well-balanced economy that has attracted many major companies to the area,” said Mr Coffey, who is partners in the fledgling IWS, with former Bank of Scotland senior manager in commercial property, Richard Killeen.
Established about eight months ago, and also active in advising in non-resident QIFs (qualifying investment funds), IWI has so far made about €15m in investments in Dublin, and now Cork, and has a formula and team to do multiples of that sort of sum, they say, adding “we are considering other locations, where we envisage capital-value recovery in the short- to medium-term.”
Details: www.irelandi.com; Lisney, 021-4275079; Savills, 021-4271371 ]