Great to get back to MIPIM 2022 (15-18th March) for Neil Bannon and Roderick Nowlan.
Please feel free to get in touch if you would like to arrange a meeting.
Best of luck to the Square management team, security, facilities and all the store staff with the “Cycle for Ukraine” fundraiser. The fundraiser will run today and tomorrow in the Centre Mall, from 11.00am – 6.00pm.
All funds raised will go to the Irish Red Cross to help those affected get food, medicine, shelter and water. Donations will also help those displaced by the conflict.
Cash donations are welcome, however if you cannot make it in person, you can donate online here or by scanning the QR Code in the image attached.
Happy International Women’s Day.
To mark the day and The Square’s Club Together initiative, please watch the video below that celebrates amazing “Strong Women” in the local community.
Tallaght is blessed to have so many influential role models in the community. Their amazing achievements inspire the younger generations and help create a thriving society where equality duly prevails.
We are very fortunate to work with some amazing women in Bannon and across our wider portfolio. Thank you for all your help and support.
Urban Transportation Hubs. A snazzy name for a car park or a way of rethinking how we move about our cities and towns?
There is an opportunity to reimagine the role of car parks. Giving over space within the facilities to accommodate secure bike parking, charging stations for electric bikes and scooters, dedicated spaces for car share schemes and a range of EV charging options for those that need rapid charging, to the owner who just needs a slow charge overnight can turn these buildings into true transport hubs.
They can form a central part of a transport interchange where customers pivot from one form of transport to another pre-booking their required option on a dedicated app. Arrive on your bike, park it securely for the day and take out pre-booked EV charge appropriately to make a trip to Galway. Arrive on a shared scooter and rent out an electric bike.
Reusing and refocussing existing infrastructure intelligently is ultimately the key to sustainability, why not start with car parks?
Blog post written by Cillian O’Reilly, our Sustainability Manager. You can contact Cillian by email on coreilly@bannon.ie
The strength of the Irish Consumer was further emphasised this week with the CSO reporting a 2.0% annual increase in weekly earnings to €864.51 for Q4 2021. When compared to pre-pandemic levels this increase jumps to 9.9%.
The CSO Labour Force Survey also reported a year-on-year increase in the Labour Force (8.9%) along with a decrease in unemployment to 5.3% which resulted in record employment of 2.5 million people.
The result of these two factors can only be positive for the Irish retail market.
Author: Cillian O’Reilly, Surveyor, Sustainability Manager, Bannon
Date: 2nd March 2022
It is fascinating how the Irish media can find the negative in any piece of data. Today’s Irish Times has a headline proclaiming that retail sales are down 1.5%, a downbeat message that seems at odd with the economy at large and our own data. The comparison is between retail sales in January and December. In reality there are very few years when retail sales in January reach 98.5% of those achieved in December given when Christmas falls!
Not worthy of inclusion in the article is that retail sales excl. cars in January were 7% higher than in in pre COVID January 2020! They are 17% higher than January last year but the comparison with COVID impact periods would be as misleading as the IT article. It shows the benefits for investors of real data and expert analysis and the negative narrative does create opportunities for the well informed astute investor. For more information contact Consultancy@bannon.ie
Author: Neil Bannon, Executive Chairman, Bannon
Date: 2nd March 2022
Bannon are delighted to bring you our February Retail Pulse. As we look towards a complete removal of COVID restrictions on Monday next what does our latest report tell us about how the market is likely to perform over the coming months?
To view the full report, please click here.
Thank you to everyone who has supported us in our 100 Miles in a Month fundraiser for The Mater Foundation. It’s been a tough challenge but even storm Eunice couldn’t stop our team and with only one week left to go, we can all agree that it has been an incredible experience so far.
There is still time to donate, which would be hugely appreciated.
To support us, click here.
Bannon is seeking a Senior Property Manager/ Associate Director – Property Management Department, Associate Director – Investment Department and Agency Surveyor – Retail Department based in Dublin’s City Centre.
Check out all the positions here.
The strength and resilience of the Irish consumer has shone through once again in the Central Bank of Ireland’s Quarterly Financial Accounts. The accounts show household net worth rose by 9% in the year to Q3 2021 and now equates to €188,457 per capita. In the same period household debt dropped by 2%. As a result, Ireland’s household debt has fallen to 99.7% of disposable income, down from 106% one year ago and below 100% for the first time since the series began in 2002. Ireland’s household debt to disposable income ratio is now the seventh highest across the euro area.
There is a word in the Irish language which describes a storyteller. It is “seanchaí”. The author, Frank Rose, has explored storytelling and its effect on human behaviour and decision making in his recently released book “The Sea We Swim In” published by Random House. One of the themes of his book is the role of storytelling in the marketing of products. Telling the story of a product’s journey rather than simply including it in a catalogue, results in increased sales.
This theory is based on the belief that consumers make a purchasing choice based on available product information. When invested in the product’s origin story and journey, they are persuaded to purchase in greater quantities and at a higher price point. Through our retail clients, we see increasing consumer queries regarding the provenance of the goods they are buying and the story of the journey the products have taken to arrive on our shelves.
In recent LinkedIn articles we have provided updates on the great number of retail occupiers who are refurbishing and redesigning the space that they occupy within our centres. In these refurbishments there has been a shift towards lifestyle designs. This allows the retail space to enable and promote the story of the products. Consumers can handle and explore in-store before a potential purchase or online order.
Post lockdown, we have worked with over 20 retailers who have invested in store refits across our portfolio of 50 shopping centres and retail parks. In our recent Retail Pulse Jan 22 / Q4 2021, sales in shopping centres for December 2021 was 6% above the same period in 2019. This shows that there is an increased amount of business available to support this investment in stores.
Consumer behaviour regarding the story, provenance and origin of retail products is also matched by investors’ Environmental Social and Governance (ESG) requirements regarding their property portfolio. In future updates we will highlight case studies on how our current retail stock is being refurbished and redesigned to include sustainability and environmental factors. This may in turn be an opportunity to evolve and harness the consumer movement towards a more immersive retail story telling retail journey.
For now, we at Bannon will continue to be the seanchaí for the Retail Sector in Ireland!
Author: Peter Nicklin, Property Management Surveyor, Bannon
Date: 14th February 2022
LEGO is to open its first ever store in Ireland with the new store set to open in Dublin’s Grafton Street this summer.
The new Dublin LEGO store will feature the “Retailtainment” concept which blends physical and digital experiences that allow shoppers to immerse themselves in the LEGO brick, as well as create personalised products.
About 10 to 15 jobs will be created when the new store opens.
Simone Sweeney, Vice President of Global LEGO Retail Development, said the company had been looking for the perfect site in Dublin, so it was very excited when the opportunity came about to open on Grafton Street.
“The new LEGO Store will be amongst some of the biggest and best brands in Dublin, in a shopping district loved by many local families and visitors alike,” Ms Sweeney said.
She said that Dublin has been part of LEGO Retail’s expansion strategy for many years given the existing huge number of LEGO Fans in Ireland and the international customers typically found in the city.
“The new LEGO Store in Dublin will allow builders of all ages to be inspired by endless play possibilities and for new builders to welcome them into a new exciting journey of discovery into the LEGO universe,” she added.
The new LEGO store will be housed at number 41 Grafton Street – the former Topman store – in a building which is owned by Irish Life Investment Managers.
The deal was negotiated on behalf of Irish Life Investment Managers by Savills Ireland and Bannon.
The LEGO Group was founded in Denmark in 1932 by Ole Kirk Kristiansen and its name derived from the two Danish words LEg GOdt, which mean “Play Well”.
Today, the LEGO Group remains a family-owned company headquartered in Billund in Denmark and its products are now sold in more than 140 countries worldwide.
The planning system in Ireland is currently undergoing a raft of proposed changes with more changes likely to come in the coming years as the Government seeks to implement its ‘Housing for All’ strategy. While these changes will seek to address the constraints being experienced by the planning system, and which in turn impacts on housing output, new Development Plans being put forward by some Local Authorities are likely to have a detrimental impact on housing delivery.
The recently published Draft Dublin City Development Plan 2022-2028 proposes significant changes to lands which are zoned ‘Z15 – Institutional and Community’. Lands with this use designation typically relate to properties such as colleges, residential institutions, and healthcare facilities such as hospitals. Within the previous Development Plan, residential uses were open for consideration on Z15 lands subject to certain criteria such as the provision of 25% public open space and the preparation of an overall masterplan.
However residential uses will no longer be open for consideration under the new Draft Plan and will only be considered in “highly exceptional circumstances”. It is estimated that there are some 1,833 acres within the Dublin City Council administrative area with a Z15 land use zoning. While a large proportion comprise schools and educational facilities there is a significant portion occupied by religious institutions and bodies. With the decline in vocations over the past number of decades and the ageing profile of the members of most religious orders, a number of them have taken the decision to rationalise their property footprints and release their lands for residential development. This trend is likely to continue over the coming years. High profile examples of residential developments on Z15 lands include Marinella in Rathgar, Ardilaun Court in Raheny, Hampton and Grace Park Wood both in Drumcondra.
If Local Authorities are serious about delivering on the Government’s ‘Housing for All’ plan then all potential options for the delivery of housing should be maintained, including on Z15 lands, particularly when this zoning has successfully delivered quality housing projects in the past.
Submissions on the Draft Development Plan are being invited on or before next Monday, 14th February 2022.
Author: Niall Brereton, Director of Professional Services, Bannon
Date: 8th February 2022
Ireland’s largest, domestically owned commercial property consultancy firm Bannon, has been appointed by Davy Real Estate to manage Stephens Green Shopping Centre. Located in the most prestigious and cultural area of Dublin city centre, the shopping centre comprises over 320,000 sq. ft. of lettable retail floor area.
Bannon manages over 50 retail shopping centres and retail parks across the country, covering six million sq. ft. of commercial real estate worth c. €2 billion. As market leaders, Bannon has advised and managed the country’s most notable retail spaces in the last thirty years such as Dundrum Town Centre, Blanchardstown S.C., Swords Pavilions. and The Square. Commenting on the appointment, Director of the Bannon Property Management team, Ray Geraghty said “We are extremely proud to be working with Davy Real Estate on Ireland’s most iconic retail destination and the first premium shopping centre built in the country. The appointment is further validation of the team’s unrivalled experience managing assets in the retail sector.”
Since the start of 2022, Bannon are responsible for the management of the shopping centre which includes over 100 retail outlets. As the retail sector emerges from the effects of COVID-19 lockdowns, Bannon’s management role will involve the smooth day-to-day running of the busy centre and ensuring rent and service charge collection is maximised for Davy Real Estate.
Ray Geraghty continued “Our experience is supported by a strong cross departmental approach in Bannon. The Property Management team work seamlessly with the Consultancy, Agency and Professional Services arms of the business. This results in a consistent line of communication to our clients. We are excited to get to know the occupiers of Stephens Green Shopping Centre, and working closer with them, centre management and the investors to make the centre stronger, more profitable and more sustainable.”
Achieving progress in the move to greater sustainability in any organisation requires fundamental changes in how we manage and direct our businesses. This requires the buy in of all the stakeholders, the internal team, our clients and our suppliers. Our experience with change management is that it is only truly successful if you change culture.
That’s why, when Bannon started on its sustainability journey a number of years ago, we stopped using plastic bottled water and switched to chilled tap water, provided keep cups for the team’s caffeine obsession and started using electric scooters, thankfully now legal, and Dublin City Council bikes to get to local meetings.
Simple changes like this accompanied the more significant changes such as moving our entire Property Management portfolio to renewable energy sources. Making the big moves required for a sustainable future is easier to achieve when the simple changes are clear and evident.
Blog post written by Cillian O’Reilly, our Sustainability Manager. You can contact Cillian by email on coreilly@bannon.ie
In our latest Dublin Office Market Review and outlook, we examine activity in the sector over the last 12 months and look at some key predictions for 2022.
To read the full report, click here.
Snap Fitness has opened its doors in Waterford Retail Park today and, similar to all Snap Fitness gyms around the world, the new Waterford gym will open 24/7 around the clock and will have a list of comprehensive cardio and strength-training equipment that are the highest in industry standards.
Snap Fitness has a global network with more than 1,000 centres worldwide in over 20 countries, including Ireland, United Kingdom, the United States, Australia, Canada and Hong Kong. Founded in 2003, Snap Fitness allows people to work out at a time and in a way that works best for them whether it is doing cardio, lifting weights, personal training or group fitness. They also use the latest fitness technology to elevate the experience, from the equipment in the gym to tracking via Myzone and the new Snap App.
Paddy O’Connor from Sigma Retail Partners, the asset manager for Waterford Retail Park, said “Snap Fitness is especially exciting for us as it is a unique offering to Waterford Retail Park and we are very happy that they are joining our strong tenant line-up. As part of our long-term strategy, we identified health and fitness as a category that would be very beneficial for the retail park. We are very pleased with the arrival of Snap Fitness and I am sure they will do very well.”
Waterford Retail Park is easily accessed from Waterford City and is less than 10 minutes’ drive away. The retail park is located along one of the main access routes to Waterford City from the M8 and N25 (Cork Road) and benefits from free customer parking. It is also located close to the Waterford Greenway and the new Costa Coffee store will be a great pit-stop for visitors heading to and from the Greenway.
We are delighted to launch our new look Retail Pulse.
2021 had a challenging start for the majority of occupiers and investors as uncertainty on the back of Covid continued to take a hold on the sector. As the year progressed however retail sales improved across most of the sub-sectors which contributed to occupancy rates remaining high. We remain very confident for 2022.
Keep an eye out for our monthly bullets as we track movement and give our insight into the retail sector.
To view the full report, please click here.
We at Bannon are delighted to be taking part in The Mater Foundation 100-mile challenge. The aim is to walk/run/jog 100 miles in the month of February and help raise money for the Mater Public Hospital which provides national, specialist care for cancer, heart disease, transplants, spinal injuries, major physical trauma and infectious diseases.
It would be greatly appreciated if you could support our efforts by making a contribution, big or small, to help change patients lives for the better.
To donate, click here.
Despite month on month reductions, recently released CSO Retail Sales Index figures for December 2021 report a 3.6% increase in sales values and 2.2% reduction in sales volumes when compared to 12 months prior however these figures do not paint the full picture. When motor trades and bars are excluded, these figures rise to increases of 5.4% and 0.4% respectively. The true strength of the retail sector shows through when the data is compared to pre-pandemic levels which shows a 10.2% increase in sales values and 11.4% increase in sales values compared to December 2019.
Taking a deeper dive into the data it is evident the traditional festive rush was more subdued in December 2021 with a stronger November trade showing evidence of consumers forward planning.
Top performing sectors for December 2021 were bars following their recent reopening (value increase 39.8%, volume increase 36.5%) and pharmaceutical, medical and cosmetic articles (value increase 11.1%, volume increase 9.9%).
Bannon were delighted to act on behalf of client, Belgard Estates Ltd (a subsidiary of CRH plc), in the sale of their lands at Slane Road. It is a substantial landholding on the outskirts of Drogheda which extends to a gross area of approximately 18.6 ha (45.6 acres).
The entire site is zoned ‘Mixed Use’ in the Louth County Development Plan 2021-2027 and presents an excellent opportunity to advance a mixed-use scheme with residential and commercial uses, subject to planning permission. M1 Retail Park, which is occupied by Woodies, Smyths, Sports Direct and Dealz is situated less than 500 metres to the north-west. Drogheda is earmarked to further expand on its status as the largest town in Ireland with a target population of 50,000 by 2031. The town has been designated a self-sustaining employment centre on the Dublin-Belfast (M1) Economic Corridor.
The property garnered significant interest from a range of parties. Following a tender process, a local property speculator secured the property. The guide price was €3.75m.
Every rent review has its own peculiarities. It is essential to take account of such items as the hypothetical term, break clauses, headline rent versus net effective rent and the specification of the premises to be reviewed. It is also important to ascertain if any occupier improvements have been carried out and whether these are to be disregarded for rent review purposes.
Des Byrne, Director at Bannon, has over 30 years’ experience in rent reviews on all types of commercial property and is an experienced Arbitrator. Des answers some key questions about rent reviews.
1. What types of rent review exist?
2. Is the rent to be calculated by reference to the Consumer Price Index where the CPI is tracked?-
3. How would my Rent Review be instigated?
Leases may provide that the rent review may be agreed between the parties at any time, it may require that it be triggered by a rent review notice which may be issued by the owner or by either party.
4. How is my rent calculated?
The rent will be calculated by reference to the provisions of the rent review clause, taking into consideration certain assumptions and disregards.
5. Can I agree my rent by negotiation?
Yes, this is the normal practice and in the event of negotiations proving inconclusive. However if negotiation fails to result in agreement, there would normally be provision that the matter may be referred to an Arbitrator or to an Independent Expert.
6. What is involved in Third Party Adjudication (Arbitration / Independent Expert)? How is an Arbitrator or independent expert appointed?
The lease would normally advise as to how the third-party valuer may be appointed. There may be provision where the Arbitrator/Independent Expert can be agreed between the parties.
Failing agreement, there may be provision that the matter can be referred to an appointing body such as the Society of Chartered Surveyors Ireland or the Law Society for such an appointment. Once an appointment is made, the Arbitrator or Independent Expert will write to both sides indicating how the matter may proceed. It may proceed either by way of an Oral Hearing or by written documents i.e., the forwarding of Submissions and Counter-Submissions.
Each side will have to prove their case at Arbitration and offer their true opinion of rental value and they will attempt to prove this rental value by a reference to comparative transactions.
The parties themselves may agree in advance of the Arbitration as to how the costs can be split (perhaps each side agreeing to pay their own costs and half of the Arbitrators costs). When this is not possible the Arbitrator has power under the Arbitration Act to determine costs.
A party who wishes to limit their exposure to costs may decide to serve a Calderbank Offer on the other side which may have the effect of limiting their exposure to costs. A Calderbank Offer is an offer to settle the rent review at a particular figure without prejudice save as to costs.
7. Is it possible to Regear my Lease?
Sometimes this is possible particularly where occupiers have the benefit of break clauses or when a lease is due to expire within a short period of time.
In such circumstances, it may be possible to agree a lower rent in recognition of an occupier agreeing to forfeit their break option or agreeing to extend the lease by a particular period.
8. Other Considerations?
Particularly in relation to office rent reviews, it is important to determine the category of office with which one is dealing i.e., is it Grade A space or of a different quality. The specification of the building is also important particularly in relation to fitting out, mechanical systems and floor to ceiling heights.
In the current economic climate, comparisons may be viewed upon as pre-pandemic, during pandemic and post pandemic if we reach that point.
Retail rent reviews are tending to become contentious with the occupiers seeking lower rents in city centre locations affected by the pandemic. On the other hand owners are seeking higher rents in suburban shopping centres which are beginning to be rediscovered by employees who are now working on an agile basis.
For further information, contact Des Byrne, Director in the Professional Services and Valuation Team at Bannon (Email: dbyrne@bannon.ie).
Pan European investor and asset manager M7 Real Estate has paid just under €15 million for two office blocks in south Dublin.
Developed in the late 1980s as part of the wider Merrion Shopping Centre scheme, the Nutley and AIG buildings comprise an overall floor area of 4,016sq m (43,235sq ft) along with 83 undercroft car parking spaces. The subject property is currently generating total rental income of €1,439,932 a year.
The Nutley Building is let to a number of occupiers including Bonkers Money, the Japanese Embassy, the Austrian Embassy and Global Standards while the AIG Building is let to a single tenant with a number of sub leases in place.
While The Irish Times reported that the deal for the two offices was close to being finalised in October 2020, it is understood the proposed transaction was completed only in recent weeks. Commercial real estate consultants Bannon handled the sale.
Following its latest purchase, M7’s Irish portfolio now comprises 18 assets extending to just under 1,100,000sq ft, primarily in industrial and logistics space.
In October 2020, the company paid about €13.5 million for the long leasehold interest of five fully let units at the Sandyford Business Centre in south Dublin.
The purchase of the portfolio gave it control of five of the scheme’s 10 units along with an associated provision of 200 car parking spaces. The portfolio’s office accommodation covers a combined area of 4,532sq m (48,786sq ft) and is producing annual rental income of €1,192,578 with a weighted average unexpired lease term of 5.8 years, with breaks at 4.6 years.
In August 2020, the company paid €6.25 million for the former Kildare headquarter office and distribution facility of convenience store operator ADM Londis, while in January 2020 it acquired the Primeside Park industrial estate in Dublin for €6.75 million.
The group also controls the Century Business Park in Finglas, which it acquired for €4.47 million in September 2019, and the Westlink industrial estate in Dublin 10, which it bought for €13,870,000 in 2018.
Its first investment here came in 2017 when it bought Fumbally Lane, a combined office and residential development in Dublin 8 which was on the market for €24 million. M7 sold Fumbally Lane to BCP Asset Management in 2018 for €33.5 million, following the completion of a comprehensive asset management programme which enabled the property’s vacancy rate to plummet from 17 per cent to 2 per cent through the addition of 19 new tenants, and its annual rental income grow by €1.14 million.
M7 operates across 14 countries. It manages a portfolio of about 835 retail, office and industrial assets with a value of about €5.1 billion.
Take up for 2021 exceeded 1,700,000 sq.ft. There was a notable increase in market activity from H2, with Q4 attributing over 1,000,000 sq.ft. to the final years take up figure. This was largely boosted by 2 transactions in excess of 200,000 sq.ft. (representing 29% of total take up).
We are off to a strong start for 2022 with over 800,000 sq.ft. of accommodation currently reserved.
The Bannon snapshot shows an exceptional year for PRS with almost 42% of turnover (despite a weak Q4) and the wider market as a whole showing the second-highest annual turnover on record. 2022 likely to see the resurgence of retail and consolidation of sheds!
From all of us here at Bannon, we would like to wish you and your families a very happy and healthy Christmas with every success for 2022.
Since the retail sector emerged from lockdown in May 2021 we have worked with 20 retailers who have invested in store refits cross our portfolio of 31 shopping centres and 19 retail parks. Shop local this Christmas!
Revised street categorisation reflects retail shift to focus on shopper experience.
The recently published Draft Dublin City Development Plan 2022-2028 proposes changes to Dublin City Council’s approach to retail in the City Retail Core (Henry and Grafton Street environs). The revised categorisation of some streets aims to support a more diverse retail experience while preserving the role of Grafton and Henry Street at the top of the retail hierarchy.
Street categorisation involves recognising key shopping streets within the Core as suitable for specific use, protecting them as shopping destinations. The changes were informed in part by the ‘Role and Function of Retail in the Dublin City Centre’ retail study carried out by Bannon for Dublin City Council in early 2021.
Street Category Changes
Category 1 designation focuses on a predominately higher order retail user mix at street level, aiming to promote premium retail within the city centre. Under Category 1 low-order retail services are not permitted and non-retail services may be provided for, on merit, providing they do not undermine the primary retail function. The revised plan has allocated the Category 1 designation to Henry/Mary Street (O’Connell to Jervis Street) and Grafton Street only. O’Connell Street, Middle Abbey Street, Liffey Street Lower, Wicklow Street, South Anne Street, Duke Street and South King Street have all been moved from Category 1 to Category 2 streets.
Category 2 applies to streets where there is an existing mix of operators, such as retail, food and beverage, cultural and entertainment, or where there is the opportunity for increased diversity of retail character on the street. The objective is to allow for a retail mix that is complimentary to the Category 1 street while enhancing the vibrancy of the shopping experience within the City Centre.
This plan underscores Henry and Grafton Street as the City’s premier retail destinations whilst the re-categorisation shall be supportive of a more diverse and vibrant retail offer within the broader retail core. The changes will allow the City Centre to better reflect what is happening in the global retail market with a shift to Omni Channel Retailing and a greater focus on the experience that retail destinations offer rather than just the products they sell. This approach strengthens the City Retail Core’s ability to attract spend from the workers, students and tourists that have been so sorely missed.
South Anne Street (pictured) has changed from a Category 1 to a Category 2 Street. This will be supportive of the burgeoning F&B activity in the area.
George Colyer is a member of Bannon’s Consultancy Team. It provides strategic solutions for stake holders in the Property Market.
Despite the uncertainty of COVID, it is great to see such optimism across our property management portfolio with over 40 new openings since we emerged from lockdown in May 2021. Shop Local this Christmas!
We are delighted to announce the winners of the Bannon “ESG Signage” Art competition run in conjunction with Loreto Junior School Stephens Green.
Congratulations to Amy He (Power Down), Sorcha Murray (Pause before you print) & Grace Yu (Recycle) for their fantastic artwork.
A big thank you to everyone who got involved! Amazing talent from such a young group!
Our chairman and head of Consultancy Neil Bannon was invited to present to Dublin City Council this morning on how to tackle retail vacancy in Dublin City Centre, really positive session with great sharing of ideas & initiatives.
Bannon is pleased to have assisted Penneys in sourcing a 15.3 hectare (38 acre) site at Great Connell, Newbridge, Co. Kildare to facilitate the development of a state of the art logistics hub/distribution centre for the retailing giant.
Kildare County Council granted planning permission for the 55,277 sq m (595,000 sq ft) facility which will be accessed off the Newbridge South Orbital Relief Road. When constructed the building will serve all 36 Penneys stores across Ireland. The warehouse will feature 20 metres clear eaves height, 34 HGV dock leveller loading doors and an extensive automated goods handling system.
The area is home to several other high profile companies including Pfizer, Lidl (Regional Distribution Centre), Murphy Group and KDP Ireland (Keurig Dr. Pepper). It is also situated close to Junction 10 (Newhall) on the M7 motorway.
The site was sourced on an off-market basis following an extensive selection process. Niall Brereton who handled the transaction commented “We are delighted to have been able to acquire such an extensive and highly accessible site for Penneys. It will play a huge role to ensure the company’s continued growth as Ireland’s most popular retailer”.
CGI of Proposed Scheme (Model Works)
The winner of the Bannon “ESG Signage” Art competition run in conjunction with Loreto Junior School Stephens Green being adjudicated by today.. Keep an eye out on our page as we will be announcing the winners over the next few days!
We’re delighted to see the new Regatta Great Outdoors store open in Nutgrove Shopping Centre, Dublin 14.
This was our first acquisition on behalf of our new client Regatta Ltd.
The super smart looking store, which will also incorporate Craghoppers and Dare 2b products, will serve the catchment well and the strong customer base who are embracing the outdoors even more since the arrival of Covid.
It was a great team effort to get the store open and ready for Black Friday and the run into Christmas, working with Brian Fox and the Regatta Team and Andrew Johnston.
We are continuing to look for more opportunities countrywide.
Covid-19 has flipped the performance of retail assets on their head. The previously-held view was that the prime to tertiary hierarchy was – city high street, major town centre, retail park, grocery retail and local necessity centres. However, in terms of demand and performance from the occupiers on the ground, this traditional hierarchy has now been reversed and is resulting in differentiation within a sector previously considered by many investors as a homogeneous entity.
Footfall is a very effective barometer to highlight this shift. High street has undoubtedly been the most negatively impacted retail market sector with Covid-19 decimating footfall and in-shop spend. Bannon estimates that there are almost 40 shops either vacant or available on Grafton Street and Henry/Mary Street out of a total of 162. Similarly the hospitality sector, including food and beverage, like non-essential retail, has been severely impacted during Covid-19. Despite a strong recovery city centre footfall counts for Q3 2021 were still 30 per cent below 2019 levels. According to the IPD Index year-on-year total returns within the sector are showing minus 12.5 per cent.
In stark contrast the necessity retail sector (being grocery, medical and service-related offers) as well the retail parks have proved to be exceptionally resilient through Covid and continue to perform very strongly. Car counts in many retail parks for Q2 and Q3 2021 exceeded 2019 levels with retailers reporting considerable turnover growth. Provincially convenience-focused shopping centres have remained resilient with limited vacancy as shoppers choose convenience and to shop locally. We are seeing footfall levels return by up to 90 per cent of their 2019 equivalents.
In the latter half of 2021 the ‘money’ began to follow the data into retail parks as is evidenced by the position taken by AM Alpha in Nutgove Retail Park (€66.3 million) and M&G Investments through the acquisition of the Parks Collection Portfolio (€74.5 million) and the agreed acquisition of Manor West (€56 million). We estimate retail parks transactions will represent more than two thirds of all retail transactions in 2021 and will be the only retail sector within the IPD showing positive total returns for 2021 (currently running at plus 6.3 per cent).
Supported largely by the threat of inflation, the resurgence in the retail grocery sector had already commenced pre-Covid in the UK and Europe, with long-let standalone grocery often trading at yield levels of between 4 and 5 per cent. This demand is beginning to emerge in the Irish market, with a shrinking gap between what the sector is trading at in the UK and the perceived value in Ireland. More recently we have seen a number of transactions which are at materially stronger yield levels than market expectation and these are due to sign before the end of the year.
Due to the structural limitations in scalability in the “grocery market” sector in Ireland (where most anchor stores are owner occupied) and the large delta which is developing between “pure grocery retail” and “necessity retail” (being service, health, medical and food-related occupiers) this sub-sector may come into more mainstream investment focus in 2022. The disconnect between the emerging grocery yields (5 per cent to 5.5 per cent) and those in the supporting “necessity retail” (9 to 10 per cent plus) seem irrationally high, especially as the necessity retail operator’s turnover is derived from the same customer base as their high-value grocery anchor neighbours. These centres along with retail parks serve to highlight opportunity within the sector where the negative narrative in the overall retail sector is keeping yields high despite resilient trading.
Rod Nowlan is an executive director at Bannon
It’s beginning to look a lot like Christmas here in Bannon!
Background
The Property Management team at Bannon currently manage over 70 commercial sites across Ireland. The portfolio is made up of Shopping Centres, Retail Parks, Business Parks and Office Parks.
In recent years there has been an unquestionable shift in weather patterns, and this is particularly noticeable in the colder winter months. One such example was the severe weather experienced in February 2018 when Storm Emma hit Ireland. During the course of the storm, we saw significant accumulations of snow across our sites and temperatures as low as –11.0°C.
In any given year we see c.100 million visits to Bannon managed sites across the country and maintaining safe access to these sites is a crucial part of our role as Property Managers. We manage this risk by appointing contractors to carry out gritting services during periods of cold weather and snow clearance when required.
A number of years ago we recognised the obvious synergies associated with managing our winter maintenance services on a portfolio basis. For that reason, we have split our portfolio into three distinct zones (see below) and we tender the contract every 3 years.
Zone 1 – Greater Dublin Area
Zone 2 – South & South East
Zone 3 – Midlands, West & North West
Tender
A sub-team of Property Managers were appointed to oversee the tendering of the Winter Maintenance contract for the portfolio. The following tender process occurred;
Phase 1 – Review of portfolio geography and creation of 3 distinct zones
Phase 2 – Preparation of Request for Tender (RFT) document
Phase 3 – Shortlisting of suitable contractors including a visit to contractors’ facilities
Phase 4 – Issue RFT to shortlisted parties
Phase 5 – Review & analysis of tenders
Phase 6 – Selection & contract award to winning tenderers
In total the RFT was issued to 10 contractors and we received 6 complete tender submissions. The submissions were assessed and ranked based on pre-set criteria. All but one tenderer submitted a proposal for all three zones. The sub-team assessed the proposals and made a recommendation to the directors of the department to appoint three separate contractors (one per zone). This recommendation was followed and the contracts were awarded to the following parties;
Zone 1 – Greater Dublin Area – SAP Landscapes
Zone 2 – South & South East – O’Brien Facilities
Zone 3 – Midlands, West & North West – Ken Fitzsimons Landscaping
Benefits
The benefits of carrying out a procurement process of this nature are far reaching, to include;
Overall, we have seen significant benefits in procuring our Winter Maintenance services on a portfolio wide basis. Our retail clients can enjoy consistency of service across all sites. With a proactive and data driven approach, we ensure that footfall does not drop and visitor health and safety is managed.
With works now complete, we are pleased to welcome Greenlight Reinsurance as the first occupier of #50CityQuay, the latest company to join the #WindmillQTR. With two further floors currently reserved, we have one ‘own door’ office floor available to lease (1,313sq.ft). Please contact Lucy Connolly or Ros Tierney for further information on 01 647 7900.
Bannon recently welcomed a number of new colleagues to the team. Our Managing Director Paul Doyle commented, ‘We are delighted to be expanding our team across the business, to provide a greater depth of expertise to our wide client base. We wish our new colleagues every success and enjoyment in Bannon’.
No post-pandemic separation anxiety for Lily. Her Bannon colleagues are happy to have her socially distance with them in the office.
Client: St. Finian’s Diocesan Trust
The Brief: The Parish of Dunboyne identified lands adjoining St. Peter and Paul’s Church as being surplus to their requirements and as a potential means of raising funds for the Parish, particularly in the face of the financial challenges posed by Covid-19. Bannon, as joint agent, were approached to provide advice on the optimum method of disposal and how to maximise the potential of the lands, given our previous experience and expertise with the disposal of lands owned by religious institutions. The surplus land, extending to 3.54 acres, included a surface car park which was used by parishioners and church goers and needed to be replaced/relocated.
Our Solution: An alternative car park location was identified in conjunction with the design team on the lands to be retained by the Trust. Potential purchasers were provided with the specification of the proposed car park and were requested to incorporate the provision of the new car park on behalf of the Trust as part of their bid proposals.
The outcome: Following a competitive bidding process the property was transacted at a price substantially higher than the guide of €2.5m. Furthermore, the purchaser has contractually undertaken to complete the proposed new car park, subject to planning permission, on behalf of the vendor to the required specification. This means that the responsibility, and more importantly the substantial costs of project managing and overseeing a substantial works programme, has been removed from the Trust.
Testimonial: “St. Finian’s Diocesan Trust engaged Bannon as a joint selling agent in respect of the lands at main Street, Dunboyne, Co. Meath. We found Bannon to be thoroughly professional in their approach, and their market knowledge in this sector contributed greatly to achieving a successful sale.”
Fr. Patrick O’Connor.
Yesterday the CSO released a version of Ireland’s national accounts. It shows that Irish Households now have more savings than ever before (€139bn up €50bn since 2016) & the debt to income ratio has fallen by half in the last decade. We have gone from being the most personally indebted consumers in Europe to being in line with the EU average, despite a younger population and a higher propensity to own our own homes. In real money that’s €70bn less debt. Added together that’s a €120bn (€24k per capita) turnaround in the nett position before you factor any impact from the increase in the value of housing.
The current strength in spending we are witnessing in our retail management portfolio is therefore not surprising but it’s hard to find much coverage of this benign backdrop in press commentary which is drawing comparisons with 2006. Irish consumers couldn’t be in a more different place than in 2006.
The Bannon office team are pleased to present a number of high quality Georgian floorplates. Located in prestigious locations in Dublin’s Central Business District, we can cater for leasing requirements from 590 sq.ft. to 2,135 sq.ft. Contact Ros Tierney or Lucy Connolly today for further information.
A 27-villa holiday resort in Donegal has been sold for in excess of the asking price of €3.8 million.
The Donegal Boardwalk Resort, situated on the Wild Atlantic Way, has been purchased by Melcorpo, a property group.
Overlooking Sheephaven Bay, the resort was brought to the market in June by Bartra, and comprises 27 holiday villas, a fully licensed seafront bar, restaurant and function room. The property includes 45 acres, much of which is still undeveloped.
The resort adjoins the spectacular 1km-long boardwalk which links it to Tramore Beach. The renowned four-star Rosapenna Hotel & Golf Resort is a neighbouring property.
With so many people holidaying at home in 2021, Donegal Boardwalk had “an exceptionally busy summer” with full occupancy in July and August and is expecting a very strong shoulder season ahead.
The bar, restaurant and function room building is leased. The bar and eatery trades as “Hooked” and is a sister operation to the nearby Old Glen Bar and Restaurant where Ciaran Sweeney, former head chef at Dublin restaurant Forest & Marcy, is now heading up the kitchen.
A spokesperson from Melcorpo said: “We are delighted to be involved with such a great holiday facility in a beautifully stunning part of the country. We are looking forward to working in partnership with the local team leader George Scott and Cormac Walsh of Hooked to develop the resort further to its full potential as a premier holiday destination on the island of Ireland”.
Donegal Boardwalk is located within a short distance of the popular north Donegal tourist villages of Carrigart and Downings and sits just 30km from Letterkenny.
It is within a three-hour drive from both Dublin Airport and Galway and a two-hour drive from Belfast.
Bartra, who purchased the resort in 2017, when it was guiding €2.6 million, upgraded all 27 holiday villas, which are in turn-key condition, fully fitted and presented to a very high standard. Each villa benefits from a private deck.
Paul Doyle of selling agent Bannon said there was “strong interest” in the property, demonstrating the demand for quality tourist assets in Donegal.
Niamh Walsh of TDL Horizons, who advised on the sale said: “The level of interest shown from investors and operators gives us great confidence in the tourism sector.
Following one of the most uncertain 18 months for the tourism sector this successful transaction highlights the level of demand for well located hospitality assets that can easily pivot to the staycation market”.
Bannon are delighted to announce the opening of Costa Coffee at The Retail Park Liffey Valley in their new bespoke coffee pod.
Some of the Bannon team inspecting Fitzwilliam 28 this week which is nearing PC. The new ESB Headquarters raises the bar for sustainable office development in Ireland. Proud to have been part of the team to bring this exciting development to fruition since 2011.
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