The Audi Centre and McConnell House, formerly owned by developers Bernard McNamara and Gerry O'Reilly, are being offered for sale, writes JACK FAGAN
TWO Dublin office blocks bought during the property boom by developers Bernard McNamara and Gerry O’Reilly are to be offered for sale at a discount of between 50 and 60 per cent on the instructions of receiver Declan McDonald of PwC who is acting for Ulster Bank.
James Meagher of agent HT Meagher O’Reilly is seeking €5 million for the Audi Centre opposite the former Jury’s Hotel in Ballsbridge, Dublin 4 and €3.25 million for McConnell House, overlooking the Grand Canal at Charlemont Place, Dublin 2.
In 2003, McNamara and O’Reilly paid €10 million for the Ballsbridge building, then known as Texaco House, and €8 million for McConnell House which is separated by the Luas line from O’Reilly’s Hilton Hotel.
A range of other distressed properties acquired by both developers and recently transferred to Nama are expected to come on the market in the coming months.
The Ballsbridge block should be the easiest to shift at this stage given that it is let as an office and car showrooms to the Audi Centre at a rent of €376,000 per annum.
The building was extensively remodelled and fitted out by Audi before it took a 10-year lease from October, 2009.
It also has the use of 28 car parking spaces on site.
The Audi centre forms part of a larger site assembled by McNamara on Pembroke Road running from Pembroke Lane to the American Embassy.
McConnell House, a five-storey block with 20 car parking spaces on the ground floor and 1,650sq m (17,760sq ft) of office space overhead, will have to be completely refurbished at an estimated cost of €1.25 million, according to the selling agent.
However, Meagher says the building is unique in that it has open-plan, column-free office suites with floor areas from 160 sq m, a layout that is often difficult to find in Dublin 2.
Two years ago, Grattenlane, a company controlled by McNamara and O’Reilly, got planning approval from An Bord Pleanála for a substantial development of offices, cafe, hotel extension and conference facility involving the Hilton Hotel and McConnell House.
The plan included the demolition of McConnell House and its replacement by an eight-storey building with 6,719sq m (72,323sq ft) of offices and a cafe on the ground floor over a double basement.
The changes approved for the hotel included the provision of an additional floor to accommodate 18 further bedrooms.
The board also approved a seven-storey over basement extension to the rear of the hotel to include conference and meeting rooms and 34 bedrooms with health club and executive lounge.
The €18 million selling price accepted by the Irish Pension Unit Trust in 2003 for the Audi Centre and McConnell House was used by the fund in part payment of €45 million for a 50 per cent stake in Bishop’s Square, a 12,541sq m (135,000sq ft) office block on Kevin Street which was developed by McNamara.
The high quality building is currently producing a rent roll of €7 million primarily from State tenancies which have another 10 years to run.
The initial rental yield of 6 per cent has since grown by over one-third following the 2008 rent review.
