Landmark Developments and Quinlan Private have agreed to buy Bank of Ireland's headquarters on Baggot Street for slightly over €200 million, writes Jack Fagan.
Property developer Paddy Shovlin and two of his partners who made a fortune from the redevelopment of part of the Sandyford industrial estate, are to have a 50 per cent stake in the Bank of Ireland headquarters on Baggot Street, Dublin 2, when it is sold shortly for slightly over €200 million.
Shovlin's company, Landmark Developments, and financier Derek Quinlan of Quinlan Private, have emerged as the preferred bidders for the building which is owned by the bank's pension fund Salix. The partners in Quinlan Private originally planned to retain their half share in the investment but there were indications yesterday that part of it might also be syndicated among wealthy investors.
The underbidders are understood to have included Bank of Ireland Private, Green Property, Bernard McNamara, Shelbourne Developments and Treasury Holdings. Jones Lang LaSalle advised Salix on the sale and CBRE acted for the successful bidders.
Shovlin, along with brothers Pat and Tony Fitzpatrick, have produced some of Dublin's finest commercial and residential buildings at Beacon Court in Sandyford. The developments have included hundreds of apartments, office blocks, a hospital, a hotel and covered walkways featuring cafés and shops.
Shovlin said yesterday that they looked on the acquisition as "a long term investment deal not a development play" - comments that suggest they will not be rushing in to get planning approval to enlarge the complex.
However, he indicated that in due course they would be upgrading what is one of the most notable modern office developments in the city.
In the meantime, Landmark and Quinlan will have to settle for a net yield of 2.8 per cent on the 30-year-old block which has a floor area of 20,493sq m (220,593 sq ft).
Bank of Ireland will continue to lease the building while it looks for a new headquarters campus in the Dublin area.
The bank has agreed fairly drastic changes in its 99-year lease in return for a slightly higher rent and break options in years five, six and seven, as well as after 25 years. The rent roll of €6.4 million reflects a rent for the first five years of €290 per sq m (€27 per sq ft) and €3,000 for each of the 220 car-parking spaces - well below the going rate for this quality of accommodation in the city.
