Hibernia REIT has exchanged contracts to acquire Guild House and Commerzbank House for EUR90.75m in cash from a syndicate of private investors in an off-market transaction.
The price reflects a capital value of EUR629 per sq ft and a net initial yield of 6.6 per cent.
Guild House and Commerzbank House are two adjoined Grade A office buildings located in the IFSC, Dublin 1, one of the principal locations for the financial services industry in Ireland. The buildings were completed in 2000 and have similar floor layouts and a combined 144,250 sq. ft. of space arranged over five floors. They have a shared basement with parking spaces for 148 cars and separate entrances onto Guild Street.
The offices are fully let off average rents of EUR39 per sq. ft. on leases running to 2025 with a weighted average unexpired term to break of three years. The principal tenants are FBD Holdings Ltd, Commerz Management Services and BNY Mellon.
Following the completion of this transaction Hibernia will have concluded nine acquisitions since listing, deploying EUR337m, 91 per cent of the net proceeds raised in December 2013, with a further EUR63m committed.
Kevin Nowlan, chief executive officer, WK Nowlan REIT Management Limited, the investment manager, says: “We are delighted to have agreed this acquisition which gives us ownership of two Grade A offices located in the heart of Dublin’s financial district at attractive capital values. These buildings have good running yield and their layout, size and interconnectivity offer significant near term and longer term asset management opportunities.
“We are continuing to see a very high level of transaction volumes in the Dublin office market: within this we are finding attractive opportunities that meet our selective acquisition criteria, particularly in the off-market and loan spaces.”