Irish investor buys Navan shopping centre for €4.1m

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The off-beat Beechmount shopping centre in Navan has been sold to an Irish investor for €4.1 million in a deal that will show an immediate income yield of 10%.

The sale included a 3.9 acre development site which was originally the location of Beechmount ballroom and handball alley.

David Carroll of Bannon handled the sale of the complex which includes Birds SuperValu supermarket, eight retail units and two office suites which are producing a rental income of €420,000 per annum.

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Bannon raise €22,500 for St.Luke’s

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Following 2015’s inaugural charity event, Bannon successfully completed their 2016 Charity Event in aid of the Friends of St. Luke’s Cancer Care on Saturday 21st May.

The event saw the team cover a combined total of 2,016km by cycling from their offices to Glenmalure together with a hike up Lugnaquilla, Leinsters highest mountain.

Bannon are delighted to have raised €22,500 for St. Luke’s. This brings the total raised over the last 2 years to €40,000.00.

Charity Event Details

Sandyford Hall centre for €3.7m

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The Centra-anchored neighbourhood centre at Sandyford Hall, Dublin 18, is quoting €3.7m through agent Bannon. This price level would reflect an initial yield of 8.1%.

Fully let, Sandyford Hall is producing a rent roll of €321,000 with a weighted average unexpired lease term of 10 years. Many of the tenants at the centre have been in occupation for more than a decade. Centra, whose store has recently been upgraded, occupies a 325 sq.m (3,500 sq.ft) unit with more than 18 years left on its lease.

Other occupiers include Costa Coffee, McCabes Pharmacy and Romayos Diner. There is also a crèche, dry cleaners and dentist.

Located in an affluent and mature south Dublin residential suburb, Sandyford Hall is spread over two levels with six retail units on the ground floor and a further five commercial and offices units on the first floor. According to the agent, 82% of the rent roll comes from the ground floor retail units.

The entire neighbourhood centre extends to 1,423 sq.m (15,313 sq.ft) and benefits from more than 50 surface car-parking spaces.

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Article in the Irish Times

Unemployment hits new post-crash low of 7.8%

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Unemployment has fallen to a new post-crash low of 7.8% as conditions in the jobs market continue to improve. The latest official figures show the number of workers classified as unemployed fell by 1,500 to 169,700 in May. This equated to an annual decrease of 38,300 or 1.8%.

The State’s headline rate of unemployment now stands at an eight-year low of 7.8%, down from 7.9% the previous month and 9.6% a year ago. The last time the State’s jobless rate hit this level was in October, 2008.

The figures also show that youth unemployment, which stood at 20.8% just 12 months ago, has now fallen to 15%.

Having had one of the highest jobless rates in Europe only a few years ago, Ireland’s unemployment rate is now well below the euro zone average of 10.2%.

The CSO’s unemployment estimates are based on the Quarterly National Household Survey but take into account changes to the Live Register.

The figures show the number of males categorised as unemployed in May was 109,200, down 1,600 on the previous month, while the number of females unemployed was unchanged at 60,400.

CSO reports

Irish Times

Redevelopment Opportunity at Moate, Co. Westmeath

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A former Carmelite Priory and School building in Moate, Co. Westmeath with potential for an infill residential site to the rear is being offered to the market by joint agents Bannon and Power & Associates.

The property is located close to Main Street in the Midlands town which is 15 minutes from Athlone and just over 1 hour’s drive from Dublin.  It immediately adjoins the new Carmelite Priory and Church and is bound to the rear by Moate Retirement Village and Nursing Home.  The existing buildings are in need of refurbishment and/or redevelopment and extend to approximately 1,430 sq.m (15,395 sq.ft) in addition to various outbuildings.  The rear portion of the 1.5 acre site is zoned to permit residential uses within the current County Development Plan and benefits from separate access onto a shared access road which links with the old Dublin Road.

The guide price is €150,000, further information is available through the joint agents.

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Shops at Tallaght’s The Square for €1.35m

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Two external retail outlets rented by Mao and Dominos at The Square town centre in Tallaght, Dublin 24, are to be offered for sale through the Bannon agency for €1,350,000.

The highly rated investment will show an immediate return of 7.22% after standard acquisition costs are deducted.

Alex Patterson of Bannon advises that after a rent review due in 2017 on the Moa outlet the yield on the investment will rise to 9%.

The two units are located next to the level 1 entrance and benefit from very considerable pedestrian traffic between The Square and Tallaght village.

Occupiers

Fast food giant Dominos occupies unit 135 which extends to 81.7 sq.m (879 sq.ft) on a 25-year lease from 1999 at a passing rent of €74,880.

There are eight years remaining on the upwards-only lease.

The outlet is believed to be one of the busiest in the country operated by Dominos.

Unit 137/a, extending to 136sq m (1,464sq ft), is occupied by Mao at Home on a new 15-year lease from 2012 at a low passing rent set in 2012 of €25,000. The agent expects this rent to double when it is reviewed next year.

Both units have shares in the centre management company.

Article in the Irish Times

Key Drogheda business park site for €900,000

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A key development site with mixed-use zoning on the edge of Drogheda town is to be offered for sale on behalf of CRH, the international building materials group.

Cian McMorrow of development land consultants Bannon is quoting €900,000 for the 45.56 acres close to Junction 10 off the M1 motorway and about 1.5km northwest of Drogheda town centre.

The site is zoned for a business park or new economy business under the Drogheda Council Development Plan 2011-2017, and is likely to be of interest to a range of developers. It is also expected to attract the attention of Davidson Kempner, a US hedge fund which bought the M1 Retail Park close by as part of the Projects Parks portfolio.

The land also adjoins St Oliver Plunkett’s GAA club, and is within view of a number of housing developments on the opposite side of the Slane Road. McMorrow said the zoning was quite broad allowing for uses such as offices, warehousing, a garden centre, petrol station and hotel development. There was also an opportunity for a purchaser to create a master plan and identify the appropriate uses for different end-users.

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Article in the Irish Times

Irish retail sales see a steady growth in 2016

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bannon_retail_sales_update_april_2016

The first quarter of 2016 saw a continuation of the impressive performance seen in the past two years with most key economic indicators registering steady growth. Most importantly, personal consumption is now seeing sustained growth, up 3.5% year-on-year for 2015 demonstrating a consumer economy that is now firmly in recovery.

The KBC/ESRI consumer sentiment index hit a fifteen year high of 108.6 in January 2016. By March, however, Irish consumer sentiment had weakened significantly with the index falling to a six-month low of 100.6. This drop has been linked to prolonged political uncertainty following February’s inconclusive general election, as well as the imminent Brexit vote in the UK. Nevertheless, the three-month moving average remained strong at 105.0 in March 2016, representing an annual increase of 6.8%.

Irish retail sales are seeing steady growth in 2016 with the latest CSO figures showing sales volumes to have increased by 5.2% in the year to March 2016. When motor trades are excluded, sales volumes are up 6.4% annually to reach a level not seen since 2007. Sales volumes do not tell the full story however, and price discounting has meant that the total value of retail sales has seen slightly slower growth, up 3.1% annually during this period, or 4.0% excluding motor trades. The strongest performing sectors in the year to March 2016 (in volume terms) were furniture & lighting (+12.5%); clothing, footwear and textiles (+10.3%) and books, newspapers and stationery (+8.9%).

The Visa Europe Consumer Spending Index shows that there has been no slowdown in household expenditure in the first quarter of 2016, registering a year-on-year increase of 5.6% across all payments in March. This compares with slower growth in the UK, where spending is up 2.3% for the same period. Irish high street retailers are seeing an increased willingness among consumers to spend on discretionary items, leading to a 3.8% annual rise in face-to-face expenditure, while online spending continued to see a sharper expansion, up 9.5% year-on-year.

Annual growth rates in both the value and volume of sales for key retail sectors are outlined above.

Offices Fall Behind Retail and Industrial Sectors in Q1

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Investment returns from Irish commercial property cooled off in the first quarter of 2016, according to new data from the IPD/SCSI Ireland Quarterly Property Index. Total returns from Irish investment property closed at 2.9% in Q1 2016, down from the 6% recorded in the final quarter of 2015. The twelve-month return for Irish commercial property of 23.5% to the end of March 2016 remains significantly higher than that of the UK which reached 11.7% according to the IPD UK Monthly Property Index.

Industrial property has now emerged as the strongest performing asset class with total returns of 5.6% and capital value growth of 3.6%, reflecting robust levels of rental growth in the sector. Industrial property in South West Dublin performed particularly well in Q1, with returns up 6.5%.

Retail property is now seeing sustained growth, with returns up 3.3% in Q1 driven by rental growth of 2.1%. Performance on Dublin’s two main high streets remains strong, with quarterly returns of 4.3% and 4.2% recorded for Grafton and Henry Street respectively as rental values continue to increase in line with a steadily improving consumer economy. Moreover, the data suggest that the recovery is now spreading beyond Dublin, with total returns from retail property in provincial locations also closing at 3.3% in Q1.

Following stellar growth over the past two years associated with a strongly improving economy and shortage of office space in prime locations, offices are now the weakest performing asset sector registering a return of 2.6% in Q1, down from 5.7% in the previous quarter. Office capital value growth moderated to 1.6% while rental value growth was 2% in Q1.

Muted returns in the first quarter could be a sign of uncertainties among Irish and overseas investors alike following an inconclusive general election result and the impending Brexit vote, the consequences of which on the Irish economy are unclear as yet. Stability will be crucial to maintaining confidence in the sector and ensuring the recovery continues to spread nationally.

Irish Life acquires Limerick’s top performing retail park

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The Limerick-based woman who won the Euromillions jackpot has failed in her attempt to buy Limerick’s top performing retail park. Ms Dolores McNamara was outbid for Childers Road Retail Park near Limerick University by Irish Life, the country’s largest commercial property owner with assets of over €2.5 billion.

Ms McNamara was a surprise bidder last week, making an offer above the €44 million guide price set by managers Harcourt Life.

Irish Life and a UK fund Savills Investment Managers also bid above the guide price.

In the second and final round Irish Life led the field with an offer of just under €46 million.

Ms McNamara, who scooped € 115 million in the 2005 Lotto jackpot, had not previously been known to have an interest in the commercial property market.

Had she acquired Childers Road, it would have earned her an annual rent of €3.22 million with the prospects of rent increases every five years from a range of traders including Boots, Next, Life Style Sports, Argos and fashion stores including Burton, Wallis, Evans and Dorothy Perkins.

Childers Road is by far the best performing park in Limerick: two other retail parks in the city are selling for less.

One close by known as Parkway is for sale at over €27.5 million and has a rent roll of €2.02 million.

On the opposite side of the city, a buyer is being sought for Ennis Road Retail Park which produces a rent of €1,476,000 and is on the market at €15 million.

Martin O’Reilly, head of property fund management at Irish Life Investment Managers, said their acquisition of Childers Road added a unique retail asset to their portfolio given the open use nature of the park and the general absence of this arrangement in the Irish market.

The acquisition came at a time when it is seeing consistent growth in consumer spending and continually improving economic indicators across the retail sector.

The tenant lineup of strong international brands illustrated the park’s regional dominance.

Rod Nowlan of the Bannon advised Irish Life.

Report by the Irish Times

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