16 May 2014
Hibernia enters agreement to acquire two Grade A Dublin offices
Hibernia REIT plc ("Hibernia") announces that it has exchanged contracts to acquire Montague House and Hardwicke House in Dublin 2 from Hardwicke Group in a partially deferred transaction valuing the buildings at €60m or €692 per sq. ft.
The transaction is initially being structured as a loan acquisition, with Hibernia paying a sum of €18.25m and gaining immediate operational control of the buildings. Under the terms of the contract, Hibernia will have the right to take full ownership of the buildings at any time up to mid-2016 for an incremental sum of €41.75m and under current Irish REIT rules is likely to do so in December 2015. Upon taking full ownership, the net initial yield (after costs) will be 4.4% based off average passing rents of €30 per sq. ft., with all the income subject to rent reviews by the end of 2018. The net initial yield on the €18.25m loan amounts to 7.7%.
The properties are located in the core of Dublin’s traditional CBD on two contiguous back-to-back sites which front onto Hatch Street Upper (Hardwicke House) and Adelaide Road (Montague House). The location benefits from strong transport links and proximity to excellent amenities.