Goldman Sachs, NAMA and Hines are selling their combined ownership of Spencer Dock’s Block R in the North Docklands with a guide price of €90m, amid a raft of live Irish direct property sales this summer.
Goldman Sachs acquired a €52m tranche of the Spencer Dock debt, which reflects about 60% of the total, through its IBRC Project Stone NPL acquisition at an undisclosed discount in April 2014.
The balance of the ownership of Block R is owned by NAMA and Hines, with the developer acquiring an interest as part of a wider interest acquired in Spencer Dock’s 50-acre former railway yard late last year, previously owned by Treasury Holdings.
CBRE and Savills have jointly been mandated by KPMG and Mazards, on bealf of the owner consortium, to sell the 127,000 sq ft prime office block for above €90m would reflect a 5.18% net initial yield and a capital value of €708 per sq ft.
Goldman its expected to be made whole on its discounted purchase of the €52m debt trance acquisition from IBRC.
Since Goldman’s acquisition of the majority stake in Spencer Dock’s Block R, the value of the building has risen through improving the occupancy from around 50% to its current almost fully let status, after securing The Commissioners of Public Works in Ireland on a 20-year lease with a break option in year 12.
The remaining tenants include The Central Bank and Nationwide Building Society, with the office block generating a combined rental income of €4.8m per annum.
Block R’s WAULT is 9.93 years, with the asset offering strong reversionary potential as more than 40% of the office accommodation is currently passing at a rent of €30 per sq ft. The ground floor three retail units are currently vacant.
The almost fully stabilised prime office block is expected to draw interest from Irish and German institutional investors, potentially including Irish Life, I-PUT, Union Investments, GLL Real Estate Partners and Deka Immobilien Investment.
First round bids due late July.
In a statement, Savills’ Fergus O’Farrell said: “Given the high profile location, security of long term income from state bodies in conjunction with continued investor appetite for Grade A office buildings we anticipate a strong level of interest in the property”.
CBRE’s Colm Luddy added: “The quality of the development will mean that Block R will appeal to both international and Irish institutional investors and this opportunity is well positioned to benefit from rental growth in the office market.”
Five-strong shortlist emerges on Ulster Bank and Rabobank’s Project Trinity
Five bidders have progressed through to the second round of Project Trinity, which is the sale of the company which owns the Ballsbridge Hotel and Clyde Court Hotel which are part of a 6.8 acres freehold site, which was acquired by developer Sean Dunne for €380m back in 2005.
Ulster Bank and Rabobank, which own the company, have narrowed the second round shortlist to Joe O’Reilly’s Chartered Land, Cairn Homes, London