McDonald’s on Winthrop Street returns to investment market

Hoping for a quick flip in the fast food sector is an investor who aims to off-load a Cork city McDonald’s restaurant that he bought last year for over €4 million.

This week, the long-established McDonald’s on Winthrop Street next to Brown Thomas on Patrick Street, Cork has come back to the investment market, guiding €5.2 million, and with a rental income of €372,000 pa from McDonald’s Restaurants of Ireland Ltd.

The 10,000 sq ft investment property at Nos 4 and 5 Winthrop Streetwas put to the open market in February 2014 with Maurice Cohalan of Cohalan Downing, then guiding €3.5 million for Dublin-based owners.

It attracted 15 tenders, and was bought by an overseas buyer, with Cork roots, for more than €4m.

Now, it appears, that investor has bigger fish to fry and is chasing a larger investment, and has decided to sell on his Golden Arches investment.

When he bought, he obtained a return of c 8.5%, and now there’s a bit of compression on yield. Guiding at €5.2m and a yield of 7.15%, agents Rob Coughlan and Brian Olden of Cohalan Downing say it’s a prime investment and an exceptional, profile building.

It is let on a 35-year FRI lease from 1985, incorporating five yearly, upwards only rent review provisions, and so has less than five years left to run before the lease will have to be renegotiated.

There’s a service access on Winthrop Avenue by Ginos and Scoozis restaurants, and other adjacent traders include Brown Thomas, Peter Mark, Hallmark, Debenhams, Penneys, Vodafone, Dunnes Stores. The GPO is at the street’s other end, on award-winning Oliver Plunkett Street.

The McDonald’s property is laid out as a fast food restaurant/take away over ground and first floor, with ancillary stores, changing rooms and office accommodation overhead.

It has 3,500 sq ft at ground level, some 35’ street frontage to Winthrop Street and when offered last year by tender caused a bit of a bun-fight among would-be investors. Now, it remains to be seen how many still have an appetite for a lot of this size, at a higher price level.

“McDonald’s is one of the best covenants in the world,” say Cohalan Downing, and this outlet is one of two in the city centre, while two more drive-thrus opened in Cork in the past year, in Ballincollig and at Turner’s Cross.

Details: Cohalan Downing, 021-4277717