Iput tests prime retail market with Henry Street sale

A portfolio of Henry Street properties will test the strength of demand for prime retail assets at a time when traditional retailing faces a growing online challenge.

The properties – 16, 17 and 45 Henry Street – are on the market through Savills at more than €26 million and are being sold by property fund Iput. There are fully let, generate a rent roll of €1.115 million and, based on the guide price, a deal would reflect a net initial yield of 3.95 per cent.

Combined, the mid-terrace properties extend to 1,241sq m (13,360sq ft) – with ground floor retail space of 446sq m (4,802sq ft) – while their street frontage extends to almost 25m. They are located close to Arnotts department store.

Video game and consumer electronic retailer GameStop rents No 16 at €450,000 per year. The chain has 7,117 stores worldwide and had group revenues of €9.225 billion in 2017.

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Health food chain Holland & Barrett, which has a large presence in Ireland, rents No 17 at €280,000. It operates more than 1,300 outlets in 16 countries and reported group revenue of £640 million in its latest financial year.

Clothing retailer Fat Face pays € 385,000 for the ground, basement and part first floor of No 45 (the remaining upper floors do not form part of this sale). It has 260 stores throughout the UK, US and Ireland, and posted revenue of £226 million for the financial year ending June 2017.

Recent tenants

Recent lettings on Henry Street include JD Sports taking a 3,251sq m (35,000sq ft) flagship unit in the Jervis Centre at a rent of €2.15 million and Next letting 3,300sq m (35,521sq ft) at Nos 7-9 at about €1.8 million per annum.

Iput bought 16 Henry Street in 2015 as part of a deal to acquire three prime retail assets from the Construction Workers’ Pension Scheme for an all-cash consideration of €21.3 million. Iput had acquired No 17 in 2014 for about €3.5 million.

Retail property has recovered somewhat since the crash but not to the same extent (in value terms) as offices and residential. Prime Henry Street retail rents stand at about €4,683 per sq m – more than 33 per cent off their 2008 peak – while those on Grafton Street have settled at about €6,500 per sq m (38 per cent below their previous peak).

Property investment company Green Reit announced last year that it had sold out of retail in favour of logistics – its retail holdings once accounted for about 20 per cent of its portfolio.

However, footfall on Henry Street is on the rise – up 4 per cent in the first eight months of 2018 – following the introduction of the Luas extension. About 600,000 pedestrians per week use the street, which works out at annual total of more than €24 million.