Value beyond the pale

A second multi-million euro Waterford sale — the AIB bank branch in the heart of the city for close to €2.25 million to a private investor - is imminent. It comes on the back of the just-concluded sale of the Fitzwilton Hotel, to an Austria-based investor, for €3.2m.

Value beyond the pale

The Waterford AIB bank sale follows on the successful sale of a Tralee Bank of Ireland branch at auction last week, for just over €3m, equivalent to a 9.2% return (see separate story over).

Both Waterford deals indicate returns to investors of over 8%, showing an appetite for purchases outside the capital, based on better value and healthier returns.

Selling in Waterford’s 1100th anniversary year, the city’s four-star Fitzwilton hotel made €3.2m, after widespread international and national interest, including Irish chains and multi-hotel operators. Built in 2006 by Galway-based Noel Burke, the Fitzwilton was very profitable in the last three or four years, and was sold for receivers BDO via Kirsty Rothwell of DTZ, with Sherry FitzGerald John Rohan in Waterford.

It had an initial guide of €2m when offered back in February, and that was eventually surpassed by over 50%, representing a c 8.5% return for its buyers.

It has been bought by Strategic Capital Investment, run by Davy in Ireland for Austria-based investor Thomas Roeggia. Mr Roeggia also previously bought the Aghadoe Heights Hotel in Killarney, during summer 2014 in an off-market deal via DTZ’s Ms Rothwell, for c €6.5m.

Davy have also been active on Mr Roeggia’s behalf in a number of other multi-million euro deals, including Limerick city, Dublin, Cavan, and others are being actively pursued.

The Fitzwilton Hotel sale went to two rounds of best bids, with very broad interest, noted Mr Rohan and Ms Rothwell Close to the rail station and the quays at Bridge Street/Mary Street, the Fitzwilton Hotel is well-regarded by visitors to the city, and is garlanded by the likes of Tripadvisor and Georgina Campbell.

It has 90 en-suite bedrooms penthouse suite, 10 executive suites, restaurant, bar/café and meeting rooms. Staff at the hotel have transferred employment terms, and further investment there is indicated.

Meanwhile, also expected to conclude a sale before year’s end and the expiry of the seven-year exemption from CGT is the AIB bank branch at 72/74 The Quay: it is AIB’s main branch in Waterford City, near John Roberts Square and Barronstrand Street. It made very close to its €2.25m guide to a private investor, with an annual rent of €204,000, showing a c8.25% return after costs.

The classical 6,200 sq ft bank building with modern extension to Catherine Street, is let to AIB until 2027, with a break option five years before that, on upward-only terms with five-year reviews.

When offered by DTZ, jointly with Des Purcell of Purcell Properties, it was portrayed as a good test of demand for prime investments outside of Dublin, in cities like Waterford - and that demand and appetite has now been proven by both the hotel and Waterford AIB, plus Tralee BoI bank investment sales.

Details: DTZ Sherry FitzGerald, 021-42754545/01-6399300, Sherry FitzGerald John Rohan, 051-84388

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