Knight Frank is quoting €7.8 million for two Applegreen forecourts in Dublin which offer secure long-term income from a strong covenant. Should the service stations sell for the quoted price the purchaser would secure a net initial return of 6 per cent.
The forecourts are at Sarsfield Road in Inchicore, which is quoting €3 million, and at Grange Road in Baldoyle, which is available separately at €4.8 million.
The investments, let for terms of 21 and 25 years, produce a current income of €190,000 and €300,000 per annum respectively.
Both properties are let to Petrogas Group Ltd on full repairing and insuring leases which do not have any break options and provide a guaranteed 10 per cent increase in the rent each fifth year.
The leases are guaranteed by parent company Petrogas Global Ltd, which reported a 63 per cent increase in profits for 2013 while revenues climbed by over 10 per cent. Its 2013 turnover totalled €804.5 million while operating profit came in at €10.6 million. At the end of 2014, Petrogas Global's gross assets were valued at €168.3 million and shareholders' funds stood at €44.4 million.
Petrogas operates 75 Applegreen service stations in Ireland and 34 in the UK. In September 2010 Applegreen opened and now operates Ireland’s first six motorway service stations. Another six Applegreen forecourts are due to be developed this year.
The Baldoyle Applegreen is close to the entrance of Baldoyle Industrial Estate while Grange Road is the principal thoroughfare linking Sutton and Baldoyle with Donaghmede and on to the Northern Cross/M50.
Applegreen Inchicore is along a major commuter route in and out of the city opposite Longmedows Park.
Both properties comprise a modern forecourt with four double pump islands, a convenience store/deli and car wash. The Baldoyle station also has a restaurant operated as a Subway.
According to Knight Frank: “With a combination of long-term secure income and guaranteed rental uplifts in line with projected inflation, the investments offer a very attractive cash flow and would be particularly suitable for a private pension fund. The initial return at 6 per cent, rising to 8.5 per cent over the term, is a significant premium on standard annuity or deposit rates.”
