City Centre InvestmentsTwo brothers who bought an investment on Dublin's Dawson Street less than 10 years ago for under €2 million have just sold it on to an investor for €18 million.

Brothers Terry and John Lynskey initially paid £500,000 (€635,000) for what is now a small art gallery at the junction of Dawson Street and Duke Street, as well as the adjoining coffee shop and overhead accommodation.

In 1999, they spent a further £1 million (€1.27 million) buying the adjoining shop and three overhead floors which for the past 60 years have been rented by Jackson Stops, now trading as Colliers Jackson-Stops, and shortly to relocate to a larger premises in the city.

The entire property is currently producing €300,000 per annum, giving the new owner a net initial yield of just 1.5 per cent - easily the lowest return on the street.

Two other retail and office investments on the street sold by Lisney in the past six months have also shown particularly low yields - 1.65 per cent and 1.6 per cent - largely because of the pent-up demand for commercial investments in the city centre.

The strong price paid for the Colliers block is all the more surprising because the building is let on nine separate leases - "a landlord's nightmare", according to one estate agent.

The accommodation rented by Colliers, for example, is held on three separate leases at an overall rent of €125,000.

The estate agency recently put its lease on the market and should have no difficulty in finding a buyer because it is located along one of the busiest stretches of Dawson Street.

The art gallery pays a rent of €77,500 while the coffee shops pays €26,500.

Investment adviser Ann Hargaden of Lisney, who acquired the Dawson Street buildings for the Lynskey brothers, is also believed to have handled the sale last week. She said she was not in a position to comment at this stage.

Hamilton Osborne King acted for the purchaser.