Green REIT Plc the Irish property investment company, confirms that it has entered into a conditional contract for the acquisition of One Albert Quay, a grade A office building under construction in Cork city centre, with pre-lets agreed for over half of the building.
One Albert Quay is being developed by JCD Group, led by CEO John Cleary, a local developer with a strong track record in attracting Foreign Direct Investment (‘FDI’) tenancies to the Cork market.
Summary details of the transaction are as follows:
• Single office block, under construction, with practical completion and initial payment expected in Q1 2016.
• Lettable area of 166,000 square feet (15,400 square meters) over 7 floors, subject to final measurement.
• Pre-letting agreements recently signed with 2 tenants totalling 89,000 square feet (8,300 square meters). Tyco, a market leader in the global fire protection and security solutions industries, has agreed to lease 75,000 square feet (7,000 square meters) for its global headquarters, on a 20 year lease with a tenant break in year 12, while PricewaterhouseCoopers have agreed to lease 14,000 square feet (1,300 square meters) on a 15 year lease with no breaks. The total annual rent from these two pre-lettings is €2.1 million per annum.
• Estimated total rent per annum from the building of €3.6 to €4.1 million, subject to achieving full occupancy.
• Price range of €55 million to €58 million, depending on letting position at the final payment date, with phased payments to be made on lease commencement dates and the final payment 12 months after the initial payment, expected to be in Q1 2017.
• Capitalisation yield of 6.75 per cent on let areas and 7.00 per cent on unlet areas
• Acquisition to be funded through the Company’s revolving credit facility with Barclays Bank Ireland plc Savills acted as agent on the transaction.
Pat Gunne, Chief Executive, Green Property REIT Ventures Limited, the Investment Manager, commented: “We are delighted to announce the acquisition of what will be Cork’s best office building and the first major city centre office development in Cork for over a decade. The yield premium over Dublin is attractive, particularly with the Cork office rental market at an earlier stage in the recovery cycle. We look forward to working with JCD Group in the period ahead to secure further high quality tenants for the remaining space in One Albert Quay.”