Block, stock, and barrels blazing as €1.9m Model Farm Road Cork office investment follows €5m Midleton deal 

Tommy Barker says after the €5m sale of Watersedge  Midleton investment to BlackBee, this  Cork Business Technology Park property is one of the first investment opportunities of 2021, in a very quiet market of limited stock and opportunities

Block A, Cork Business and Technology Park, Model Farm Road on the market with Lisney and BidX1 for a guide price of €1.9m.

COMING on the back of a just-concluded circa €5 million investment property sale at Watersedge, Midleton, to the very active alternative investment fund BlackBee, agents Lisney bring a Cork suburban office investment to market, guiding €1.9 million.

Just listed for sale via private treaty with Lisney and joint agents BidX1, is Building A, at long-established western suburban Cork Business & Technology Park, on the Model Farm Road, and it offers a net initial yield (NYI) return of 5.85%, with reversionary scope too.

It’s one of the first investment opportunities of 2021, in a very quiet market of limited stock and opportunities. It comes as Lisney Cork confirm the sale of a mixed-use investment in Midleton, with a McDonalds restaurant among the tenant line-up.

The sale for circa €5m of Watersedge, Midleton, anchored by a McDonalds has just been concluded.

The Watersedge deal spanned four modern, c 2000s-built buildings, with McDonalds paying €79,994 pa for their restaurant, along with 36 apartments, offices and retail space, on c 15 acres within the town. Income is €336,312 pa, and if several show apartments are let this could rise (subject to RPZ restrictions) to €411,083 pa, while the McDonalds rent (on a 35-year lease with no break option) brings the total current rental income at Watersedge to €416,306 pa.

Current NYI is 7.5% “with significant reversionary potential when the vacant commercial units are let and residential rents are brought in line with RPZ” say David McCarthy and Margaret Kelleher of Lisney who declined to confirm the exact selling price to Cork-based Blackbee, thought to be close to €5m: it had gone to market in September 2020 with a €5.5m guide.

There was “significant interest from a range of funds and private investors who recognised the potential opportunity to add value to the property through astute asset management,” they add.

Purchasers BlackBee are headquartered at City Quarter, Cork, and invest across five target sectors, including commercial property, hospitality, healthcare/nursing homes, social housing, and renewable energy.

Launching meanwhile this week with Lisney  (jointly with BidX1) is a further multi-million euro investment in Cork’s western suburbs.

Block A, Cork Business and Technology Park, Model Farm Road on the market with Lisney and BidX1 for a guide price of €1.9m.

Building A’s main tenant is S3 ASIC Semiconductors (a subsidiary of Dialog Semiconductor, which employs 2,300 in 37 locations globally) in Cork for 20 years and now with 7,262 sq ft at the ground floor, and there’s a new, ten-year lease from 2020 with a rent of €116,480 pa exclusive, with a break option in year six.

It offers significant potential to boost rental return as the first floor also of 7,262 sq ft, was recently vacated “and there is a potential to increase the total income from the property to €232,480 pa once a tenant is secured for this floor” say the joint agents.

The sale price equates to €118 psf, well below replacement value a net initial yield of 5.58% with a potential reversionary yield of 11.1% (after allowing for standard acquisition costs).

The building’s main tenant is S3 ASIC Semiconductors (a subsidiary of Dialog Semiconductor) in Cork for 20 years and now with 7,262 sq ft at the ground floor, and there’s a new, 10-year lease from 2020 with a rent of €116,480 pa exclusive, with a break option in year six.

A detached third generation office building (air-con, lift access, suspended ceilings etc) Building A adjoins the architectural award-winning Pilz Ireland building on the 79-acre park, set between UCC and CIT third level campuses, near the Rubicon Centre, County Hall, CUH and just 2.5kms west of the city centre.

Other tenants at the park include Boston Scientific, Stryker, Alcon and Abtran. It’s got 16,070 sq ft (GIA) on grounds of just over an acre with 55 surface car parking spaces.

Meanwhile, also confirmed in Cork’s office market is a lease of 8,200 sq ft at The Cube, Monahan Road to new arrivals Microchip as a development centre, set for 60 jobs initially and rising to a projected 300. 

The deal to the Arizona-based company for R&D uses, at c €20 psf, was via joint agent Savills and Lisney in a 100,000 sq ft south docklands five-storey office building (previously Phoenix House) where other occupiers include Regus and Dassault Systemes.

Details Lisney 021-4275079, Savills 021-4271371, BidX1 01-667 3388.