Two landmark investments in Galway city are fresh to the market this week with DTZ Sherry FitzGerald quoting a combined €32 million.
The so-called Corrib Collection, which is for sale in one or more lots, includes the mixed- use Geata na Cathracha, Fairgreen, and nearly all of the Dockgate office block on Dock Road.
Geata na Cathracha, Fairgreen, includes a mix of retail, office and residential units over 11,706sq m (126,000sq ft). There are 11 two-bedroom apartments, a restaurant of about 464sq m (5,000sq ft), a language school of about 2,787sq m (30,000sq ft) and the OPW occupies nearly 4,645sq m (50,000sq ft).
The fully let asset is currently producing a rent roll of €1.636,040 million. Tenants, which are unaffected by the sale, include the OPW, Ulster Bank, Atlantic Language School and Loam restaurant.
The OPW has more than nine years left on its lease, Ulster Bank’s runs out in 2017, while the rest of tenants have typically signed recent 10-year leases with break options after five years. The agent is guiding €23 million for Geata na Cathracha, Fairgreen, which would represent a new initial yield of 6.47 per cent.
Some 4,459sq m (48,000sq ft) of office space at the five- storey Dockgate office block overlooking Galway harbour is guiding €9 million. Should it sell at this price, the purchaser would secure an initial yield of 5.6 per cent.
Units 2, 4, 8, 10 and 12 at Dockgate, which make up about 1,394sq m (15,000sq ft), are owned by third parties and do not form part of the sale.
Dockgate is currently producing a rent roll of €526,934 but, as some 1,394sq m (15,000sq ft) of the space is vacant, there is obvious potential to increase this amount. Modern office space of this quality in Galway city would be expected to secure around €193.75 a sq m (€18 a sq ft).
International interest
There should be plenty of domestic and international interest in these assets as agents are reporting a noticeable increase in demand for property outside Dublin since the start of the year.
For example, last week BNP Paribas Real Estate reported that investor spend in the Irish commercial property investment market in the second quarter of 2015 was split almost 50/50 between Dublin and the provinces.
Patricia Staunton, director of DTZ Sherry FitzGerald, says the Corrib Collection offers investors "a huge opportunity" to acquire a strong foothold in the Galway city office market where the vacancy rate declined to 5.8 per cent at the end of the first quarter this year. Expressions of interest in the Corrib Collection are being sought by noon on August 21st.
