€6m Lee Clinic a healthy investment after HSE suite leases bring campus to 100% occupancy

Initially developed at a cost put at €20m, the 12 year old quality Cork medical scheme is finally fully occupied, with a rent roll of €400,000. The investment is offered by Cushman & Wakefield at €6m or a 6% return

Lee Clinic Cork has a €400,000 pa income, and wil give investors a 6% return at the €6m guide

BROUGHT to robust and full investment health over the past year, and now with a €6m price tag,  is a Cork city medical campus, now finally fully occupied after 12 years on the equivalent of a waiting list.

Line up at the Lee Clinic, now at 100% occupancy

Just being put to the investment market is the Lee Clinic,  after the HSE moved hospital consultancy services in alongside some Bon Secours Private Hospital consultancy suites.

The deals with the HSE bring the annual rent roll to just over €400,000 at the western suburban Lee Road's  Lee Clinic, developed at a then-quoted €20 million back in 2009 on its launch.

Set on the Lee Road, a walk from Victoria Cross, the Lee Clinic is in two blocks, with 145 car parking spaces 

Behind the development at the time were five Cork-based medical consultants, and developer John Bowen, whose Bowen Construction/Bowen Mullally HQ had occupied this site, on the city end of the Lee Road.

Prior to this 2021 investment sale - which is likely to surpass the modest €6m guide at a c 6% return quoted by agents Peter O'Flynn and Siobhan Young of Cushman & Wakefield - there'd been extensive further investment in fit-out by newly arrived tenants the HSE within the past year.

Healthy reception

It will now accommodate HSE consultants from three public hospitals, the Mercy, Cork University Hospital and the Cork University Maternity Hospital, taking 17 suites out of 22 (the other five are tenanted of owner-occupied)  and some   14,500 sq ft in a 22,000 sq ft three-storey building.

The HSE has taken 14,500 sq ft in 17 suites for hospital  consultants from the Mercy, CUH and CUMH

It adjoins a 6,000 sq ft block occupied by consultants from the Bons, and has a bridge link to a 106 space multi-storey car park with 39 more parking spaces at ground.

Cushman & Wakefield director Peter O'Flynn has been involved with the  Lee Clinic since its first launch in 2009 and comments that after a checkered history "the entire facility is now fully occupied for the first time and is now a serious Medical Campus in line with what the original partners had in mind for this building."

The Lee Clinic was launched in 2009 by a consortium of consultants, with developers Bowens, with a value of €20m applied to it at the time.

With 100% occupancy and rents of over €400,00 from four HSE leases and fresh fit-out and spec, "based on the prices being paid within the medical sector at present we believe the investment will comfortably make more than €6m,  and could go a deal better," says Mr O'Flynn.

The C&W head of capital markets added that the investment market had diversified in recent years and said "Covid has certainly been an influence on the property market,  in more ways than one:  another consequence has seen the HSE becoming much more active, expanding in different directions."

Pitching the investment at both private and institutional investors, C&W says the "state of the art interior fit-out including specific medical facilities has resulted in a high-quality medical grade campus with a bright future."

Newly completed suites leased to the HSE will include oncology and out-patient services at ground and  CUMH fertility services at first and second floor level.

In terms of 'blue chip' investment security, the HSE now occupies 14,554 sq ft in Block 2 with a WAULT of 10.2 years to lease expiry, and 9.4 years to tenant break.

"The Lee Clinic Medical Centre has been transformed over the last 12 months in a managed structure by all parties involved. In addition to the original consultant clinics it now provides a wide range of clinical services backed by all the major hospitals in Cork City. The new lease structure has resulted in an investment of high quality and with sustained occupancy and should be attractive to many investors looking at the medical sector.”

Initially behind the Lee Clinic venture were five Cork medical consultants, Conor O’Shea, Brian Whooley, William Stack, Charles Shinkwin, and  William O’Connor. Design of the Lee Clinic, pitched in '09 to mirror the likes of Waterford’s Whitfield Clinic, or the Beacon in Dublin, was  by Deady Gahan architects, and suites were offered for lease, or sale, at then-prices of €580,000 to €775,000.

Details: Cushman & Wakefield 021-4275454.