Eight shops on Grafton Street are about to change hands just as big rent increases are being implemented on the street. Jack Fagan reports.

Eight shops along Dublin's Grafton Street are about to change hands as a new round of rent increases is implemented by the owners of the buildings, most of them financial institutions.

It is the biggest changeover of tenants at one time over the past two decades and comes after an international study found that Grafton Street rents are now the fifth highest in the world.

Most of the shops which have come on the market in recent weeks are to be taken over by large multiple fashion traders who, according to retail agents, are in a better position to pay the higher rents than independent traders.

Apart from the high profile Bewleys Restaurant, the other shops about to get new tenants are Sock Shop, Club Tricot, Bally, Gymboree, Carl Scarpa, The Game Shop and Suits You.

Agents report an increasing tendency by landlords to buy in leases when they become available and then relet the premises on new leases at the new benchmark level of €800 per sq ft (€8,611 per sq m) for Zone A.

It is generally expected that owners Treasury Holdings will also buy in the lease of Bewleys before looking for planning permission for a change of use to retail - a condition that needs to be met because the building is listed for preservation. There is bound to be immense interest in the store among international fashion chains, including H & M and Zara because of the amount of space available - 1,486 sq m (16,000 sq ft) including a ground floor area of 300 sq m (4,300 sq ft), a basement of 455 sq m (4,900 sq ft) and a first floor of 250 sq m (2,700 sq ft).

If it buys in the lease, Treasury can expect a significant increase in the current rent of €768,200.

River Island set a record for the street this time last year when it paid a Zone A level of €13,751 per sq m (€1,275 per sq ft) for the large Arnotts-owned store near the bottom of Grafton Street. The rent was at that time more than double the going rate on the street, though many other rents have since begun to move up.

Retail specialist Eoin Feeney of agent Palmer McCormack says that the River Island letting may have signalled the emergence of a two tier letting market on Grafton Street.

Should the Bewleys building go on the open market he believes that, because of its size, it is likely to be let at an even higher Zone A level than River Island. He said shopping centres, like Blanchardstown and Dundrum, were fuelling the demand for larger shop units and were attracting the big international tenants.