International real estate advisor, Savills, has launched the ‘Grafton Collection’ to the market for sale by private treaty with a guide price of €40m.

This multi-let investment block, which enjoys a pivotal location on Grafton Street – one of Ireland’s busiest retail thoroughfares – is expected to attract interest from both domestic and international investors. The sale represents one of the most significant high-street retail investment sales to occur in Ireland in recent years.

The Grafton Collection is being offered with a guide price of €40 million – which equates to a net initial yield of 4.62% – and is being offered for sale in its entirety, or as two spate lots.

The Grafton Collection comprises:

• 21-23 Grafton Street and 24 Duke Street (Lot One)
• Creation Arcade (Lot Two) which fronts onto Duke Street, Lemon Street and Duke Lane. 
• The combined rental income is approximately €1.95 million per annum.

Lot One, which includes four adjoining buildings located on 21-23 Grafton Street and 24 Duke Street, is guiding €28 million reflecting an initial yield of 4.46%. Tenants include Claire’s, Fields, Hickey’s Pharmacy and Kelly Services. The current rent roll is approximately €1,326,000 per annum.

21-22 Grafton Street is a four storey over basement building extending to approximately 710 sq.m (7,638 sq.ft.) with retail use at ground and basement levels, and office use on the upper levels. Retail tenants include the Irish owned Hickey’s Pharmacy group and the award winning Fields Jewellers.

The three upper floors of office accommodation are fully let and benefit from own door access onto Duke Street. With a pivotal corner profile mid-way along Grafton Street, the building benefits from significant profile onto Grafton and Duke Street. The adjoining building, 23 Grafton Street is a four storey over basement building which extends to approximately 300 sq.m. (3,224 sq.ft.) and is let entirely to Claire’s, the leading accessories and jewellery retailer.

24 Duke Street, also included within Lot One, is a retail building which extends to approximately 154 sq. m. (1,652 sq.ft.) and has the benefit of vacant possession. The building, which was previously occupied by Feraud menswear, has a prominent pitch on Duke Street, adjoining Nespresso and Hickey’s pharmacy, and located only 25 metres from Grafton Street. Given the effective zero percent vacancy rate on Grafton Street, the property will provide an incoming purchaser the opportunity to capitalise on excellent letting prospects in the retail sector.

Lot Two comprises Creation Arcade, a three storey multi-let building extending to approximately 1,199 sq.m. (12,906 sq.ft.) with frontage onto Duke Street, Lemon Street and Duke Lane. The property is let to Nepresso, Ireland’s first standalone store together with the new state of the art “Hyde” bar and restaurant, which is currently being fitted out.

The Hyde will be operated by a familiar consortium, who have extensive experience in the food and beverage industry. Mike Ormond and Ian Redmond have operated two food and beverage outlets in Dublin Airport since 2009, while another partner in the venture, John McCafferty, previously operated the Pembroke Bar and Restaurant in Dublin 2. The current rent roll is approximately €625,000 per annum. Lot 2 is guiding €12 million reflecting an initial yield of 4.99%.

The Grafton Collection is located in the centre of Grafton Street and Duke Street, occupying a prominent position. Neighbouring occupiers include Brown Thomas, M&S, Aldo, Tommy Hilfiger, amongst others. The Collection will also be adjacent to new retailers soon to be on the street, ‘& other stories’ are currently fitting out while BT2 is soon to become Victoria Secrets, both of whom will be opening their first Irish stores on Grafton Street.

This Collection offers income diversity across a broad tenant mix and use types, while stepped rents, upcoming renewals and letting of the vacant space provides potential to increase overall income in the short term. The two lots provide an investor with a significant foothold on Grafton Street and surrounding side streets. The proposition is further enhanced with a planning permission secured until 2021 which provides the possibility of amalgamating the three Grafton Street properties giving an investor asset management and value-add prospects into the medium and longer term.

Domhnaill O'Sullivan, Director of Investments at Savills Ireland commented:

“Savills expect strong interest from institutional investors who continue to pursue prime high street retail assets. The Collection offers high profile assets on Ireland’s premier retail street, with an evolving retail sector and an increase in occupier demand, Grafton Street is witnessing strong rental growth making it a number one choice for investors.”