Ge­or­gians in the as­cen­dant as de­mand for city space surges

Irish Independent - Business Week - - APPOINTMENTS - Donal Buck­ley

The ris­ing tide of the prop­erty mar­ket has lifted the boats of the south Dublin city Ge­or­gian sec­tor. Re­cent ac­tiv­ity has seen not only in­di­vid­ual Ge­or­gian prop­er­ties but also Ge­or­gian port­fo­lios sell­ing for above their ask­ing prices.

In­creased de­mand for both hous­ing and city cen­tre of­fice space, as well as ris­ing rents, have boosted in­vestor de­mand. In the last two years cap­i­tal val­ues for south city Ge­or­gian build­ings in good con­di­tion or near Mer­rion and Fitzwilliam Squares are es­ti­mated to have risen by about 20pc to around €600 per sq ft ac­cord­ing to David Ben­nett of Cush­man & Wake­field.

Last week saw a port­fo­lio of 30 re­de­vel­oped Ge­or­gian houses in Dublin 4, 6 and 8 sell for more than its €60m guide price to a Dutch prop­erty in­vest­ment com­pany Orange Cap­i­tal Part­ners. Branded by agent CBRE as the Bel­grave Col­lec­tion, it in­cluded 146 stu­dio apart­ments, 85 onebed apart­ments, 29 two-bed apart­ments and five three-bed­room homes. But un­like the old bed­sits with shared bath­rooms, all these units are self-con­tained and de­signed for pro­fes­sion­als or IT work­ers who wish to live near the city cen­tre.

The port­fo­lio was as­sem­bled and re­fur­bished by a team lead by Ir­ish firm Lu­gus Cap­i­tal and backed by Broad­haven Cap­i­tal Part­ners, a unit of US pri­vate eq­uity fund, Bain Cap­i­tal. They be­gan buy­ing this port­fo­lio at a time when many Ge­or­gian own­ers were be­ing pur­sued by ei­ther the banks, which wanted their loans re­paid, or lo­cal au­thor­i­ties, which sought to dis­cour­age multi-unit houses.

How­ever, ris­ing de­mand for flats forced the city coun­cil to be­come more amenable to multi-lets and this change of heart ap­pears to be gen­er­at­ing in­ter­est from more in­vestors, both Ir­ish and in­ter­na­tional.

Re­cently Col­liers agreed two deals for two mixed-use Ge­or­gians in the south city core with two pri­vate Ir­ish in­vestors at above their ask­ing prices.

One of these, the four-storey, over-base­ment, 14 Lower Pem­broke Street, with pe­riod fea­tures, sold for €1,825,000 or 7.4pc over its €1.7m ask­ing price. Ex­tend­ing to 4,480 sq ft, this equates to more than €407 per sq ft. How­ever its seven old fash­ioned bed­sits need re­fur­bish­ment.

Pat & Karl Henry Fit­ness Cen­tre oc­cu­pies the base­ment and part ground floor and to­gether with two of­fice ten­ants they pro­vide to­tal an­nual com­mer­cial in­come of €63,600.

Mandy Daly of Col­liers has also gone sale agreed on 14 Ade­laide Road, a well pre­sented three-storey, over-gar­den level Ge­or­gian with one car space, for well over its €1.1m guide price. Ex­tend­ing to 3,470 sq ft, it has a one-bed­room apart­ment on each of three floors while Kidd Care Montes­sori oc­cu­pies its gar­den level. A high spec 300 sq ft log cabin with WC is also lo­cated in the gar­den.

Prior to those deals Col­liers sold 33 Fitzwilliam Place, 36 Fitzwilliam Place and 44 Lower Leeson Street for sub­stan­tially in ex­cess of their guide prices.

Ms Daly says that most in­ter­na­tional pur­chasers pre­fer well-fin­ished prop­er­ties with good in­come while Ir­ish in­vestors are more will­ing to take prop­er­ties which re­quire work.

Clive Roche of Cush­man & Wake­field says that with most of the in­di­vid­ual build­ings sell­ing in the €1m to €3m range, the Ge­or­gians of­fer lot sizes to suit pri­vate in­vestors.

“Mar­ket fun­da­men­tals re­main pos­i­tive, un­der­pinned by steady oc­cu­pier de­mand,” he adds.

With their smaller floor plates, Ge­or­gians can also suit smaller of­fice firms which need a cen­tral lo­ca­tion, and he has also no­ticed in­creased de­mand from ser­vice of­fice providers.

“Rental val­ues typ­i­cally range from €35 to €40 per sq ft,” he adds. In 2013 they were around €15 per sq ft.

“Cap­i­tal val­ues typ­i­cally range from €400 to €500 per sq ft, how­ever for ex­cep­tional prop­er­ties, par­tic­u­larly those lo­cated on the main Ge­or­gian squares, we have seen trans­ac­tions in ex­cess of €600 per sq ft,” he adds.

Two tranches of Ge­or­gians re­cently brought to the mar­ket will present in­ter­est­ing tests of de­mand from wealth­ier in­vestors both Ir­ish and overseas. Bally­bunion Cap­i­tal Ltd, a qual­i­fy­ing al­ter­na­tive in­vest­ment fund (QIAIF) is sell­ing Bag­got Build­ings, com­pris­ing four Ge­or­gians at 19-22 Lower Bag­got Street near the cor­ner with Pem­broke Street.

Ad­vised by Alan Con­way of Al­way Con­sult­ing Ltd, Bally­bunion bought the four in 2016 for €4.5m and un­der­took a ma­jor re­fur­bish­ment and up­graded them as ser­viced of­fices. Now David Ben­nett of Cush­man & Wake­field is guid­ing in ex­cess of €8.5m for them.

The work in­cluded restora­tion of pe­riod fea­tures in­clud­ing stained-glass win­dows and fire­places. The four houses have an over­all floor area of 12,723 sq ft and come with four base­ment car park­ing spa­ces. Num­bers 20 and 21 are in­ter­con­nected at all lev­els while num­bers 19 and 22 are con­nected at base­ment level. No 22 can also be used as a self-con­tained build­ing.

An­other port­fo­lio to come to the mar­ket re­cently is the Vis­count col­lec­tion, a group of five fully-oc­cu­pied Ge­or­gians,

Prime pe­riod:

The Bag­got Build­ings, com­prise four Ge­or­gians at 19-22 Lower Bag­got Street, is ex­pected to at­tract a range of in­vestors two of which count a night club among the ten­ants. They are be­ing sold by a pri­vate Lon­don-based in­vestor in one or more lots.

The more valu­able of the lots is 38-39 Lower Leeson Street for which joint agents Mur­phy Mul­hall and Cush­man & Wake­field are guid­ing over €5.15m. These com­prise two multi-ten­anted in­ter­con­nect­ing Ge­or­gians and two mews apart­ments to their rear. These Ge­or­gians ex­tend to 15,080 sq ft over five floors in­clud­ing base­ments. The in­ter­con­nect­ing base­ment of both build­ings is oc­cu­pied by An­gels night­club. Each of the top floors ac­com­mo­dates a two-bed­room apart­ment while the other floors are de­voted to of­fices. With a pass­ing an­nual rent of €358,300, this sug­gests a net ini­tial yield of 6.41pc.

The mews apart­ments and nine park­ing spa­ces to the rear are ac­cessed from Leeson Place.

The other Vis­count lot at 17-19 Fitzwilliam Street, com­prises three in­ter­con­nect­ing four-storey, over-base­ment Ge­or­gians which ex­tend to 9,374 sq ft. These are fully oc­cu­pied with com­mer­cial oc­cu­piers on ground, first and base­ment lev­els with the up­per floors com­pris­ing six apart­ments. In good con­di­tion they gen­er­ates an­nual rent of €227,500 and the guide price of €4.3m sug­gests a net ini­tial yield of 4.87pc.

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