Friends First has purchased two more property investments in Dublin and Galway, further adding to its fund, which is already valued at more than €500 million.
The company has paid about €25 million for a warehouse and distribution facility built in two sections on an enclosed site of 9.4 acres at Merrywell Industrial Estate in Ballymount, Dublin 12. The fund availed of a sale and leaseback opportunity with a 35-year lease at an overall equivalent yield of 6.2 per cent.
The tenant is a subsidiary of Valeo Foods, which produces branded food products such as Rowse Honey, Odlums, Batchelors, Jacobs, Roma and Chef brands. William Harvey advised the vendor while Quinn Agnew acted for Friends First.
The Galway acquisition involved a modern office building rented by the multinational Cisco Corporation at Oranmore Business Park. The fund bought the nine-year-old investment for €8.1 million – €400,000 below the guide – which will provide a net initial return of 9 per cent.
Rent reviews
The building extends to 4,613sq m (49,694sq ft) and produces a rental income of €773,850. Cisco has occupied the building on a 25-year lease from 2007. The lease incorporates five-yearly upwards-only rent reviews, with the next break option occurring at the end of 2022. A basement car park accommodates 99 cars and there are an additional 42 surface spaces available on the grounds.
Cisco is a multinational corporation that designs and sells communication technology and services and is headquartered in San Jose in California.
CBRE represented Cisco while JLL advised Friends First.
Claire Solon, head of property at Friends First, said the fund continues to target strategic acquisitions to grow its rental income. The two new assets were accretive to the overall yield.
