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News Release

Dublin

HARP PORTFOLIO

Long term Government income office portfolio


Dublin, 28th May - Joint agents JLL and CBRE will be bringing Harp Portfolio to the market next week.  The portfolio is made up of 4 city centre office buildings providing long term government income.  

The buildings are located within Dublin 1 and 7 and include 48-49 North Brunswick Street, 31-35 Bow Street, 89-94 Capel Street and 21-24 Green Street.  

The portfolio, which has an overall weighted unexpired lease term of approximately 8.5 years, is currently producing a rent of €2.37 million per annum.  Approximately 98% of the income is generated from government tenants or government backed tenants providing secure long term income for investors.

The portfolio is very stable with 3 of the 4 office buildings let on single, full repairing and insuring leases to the OPW.  The Irish Human Rights and Equality Commission have just let 3 of the 6 floors within 21-24 Green Street on a 20 year lease with a tenant break option in year 10.  In addition, the penthouse of this building is the only vacant floor within the entire portfolio and the vendors are confident that this may be let in advance of a sale being completed. 

The agents will be quoting a guide price in excess of €28.5 million for the portfolio.  Pricing at this level will provide an initial unleveraged return of approximately 8% per annum and a capital value per sq.ft of €327 based off a total floor area of approximately 87,110 sq.ft. 

With long term Irish government bonds currently trading at less than 1.3% per annum, Harp Portfolio offers investors a significantly higher return potential.  It is likely that investors would be able to secure attractive debt terms on the portfolio, which will enhance the returns and could provide investors with immediate double digit return depending on the loan to value ratio they choose to apply. 

Dublin 1 / 7 Office Market
The assets form part of the Dublin 1 & 7 submarkets.  These locations fulfil an important role in the Dublin office market by providing good value and affordable modern office space, particularly attractive to government or legal occupiers, which is not available in the core Dublin 2 market. 

Rent levels are approximately 50% less than those in the core and have started to grow in response to the improving market conditions.  As scarcity endures, we anticipate that further rental growth will occur due to the limited choice for occupiers in the central Dublin office market. 


Demand in the location continues to strengthen, demonstrated by the recent letting of the Kings Building (85,000 sq.ft) to Workday, a US IT company. The excellent public transport provided in the area, which includes the Luas Red line and numerous Dublin bus routes, adds to the locations appeal. Accessibility and connectivity will be further enhanced on completion of the Luas cross city line in 2017.  In addition, the completion of the DIT Grangegorman Campus, situated within close proximity to the 4 properties, will further improve the attractiveness of the area and overall appeal.  Once fully completed, this new campus will accommodate over 20,000 staff and students. 

Ulysses Asset Management
Since the purchase of the Ulysses Portfolio, Tetrarch has undertaken an active asset management program which has focused on upgrading the underlying properties via an extensive capex spend, minimising vacant space and re-gearing of existing tenants.

On the leasing front, Tetrarch has successfully completed 12 recent lettings at Gross Rental Income of c. €730k, with the most notable achievements being the realisation of full occupancy at Jervis House with Version 1, the first time since the building’s construction, and the 20 year lease to UTV Ireland Limited in Macken House.

Contact
For more information on Harp Portfolio please contact Joint Agents JLL or CBRE:

John Moran
JLL
Managing Director
+353 (0) 1 673 1600
john.moran@eu.jll.com

Sean O’Brien
CBRE
Executive Director
+353 (0) 1 618 5724
sean.obrien@cbre.com