Prime Retail Park Investment Opportunity For Sale by Private Treaty

R E T A I L P A R K , L I M E R I C K

The AssetModern fully let retail park extending to 16,607.8 sq m (178,764 sq ft)

Comprising 7 retail warehouse units

Situated on the Ballysimon Road 4km from Limerick City Centre and 1km from the M7 Motorway, a major arterial route linking Limerick to Dublin

Excellent tenant mix including B&Q, Harvey Norman, Halfords, Home Store + More and EZ Living

Current rent roll of more than €2.3 million per annum

Attractive WAULT of circa 9.4 years

Additional income potential through the form of turnover top-ups and future development opportunities on site with the benefit of P.P

For the avoidance of doubt please note this is a property investment sale and the Tenants are unaffected

Modern retail park extending to 16,607.8 sq m (178,764 sq ft)

P R I M E R E TA I L PA R K I N V E S T M E N T O P P O R T U N I T YC I T Y E A S T R E TA I L PA R K

East Point Retail Park

Northern Trust

Delta Retail ParkBMWAUDI

M7

M7

DUBLIN

LIMERICK CITY

N18

N18

M7

M7

M20

R445

R445R445

R527

R511

R511R526

R512

R445 R463

R463R464

R464

LimerickLimerick

Garryowen

Ballynanty

Ballysheedy

Groody Park

Castletroy

Galvone

Dooradoyle

LocationCityEast Retail Park is located approximately 4kms south east of Limerick City, benefiting from extensive frontage onto the Ballysimon Road. The park is positioned just off Junction 29 of the M7 motorway, one of Irelands busiest arterial routes.

Limerick City is the regional capital of the south west of Ireland and the third largest city overall. The city has a population of 94,192 as per the 2016 census. Limerick is located approximately 202km south west of Dublin (M7), 102km north of Cork (N20) and 107km south of Galway (M18).

Limerick is one of three cities which makes up the Cork-Limerick-Galway corridor along the west of Ireland and has a population of over 1 million people. The city lies on the River Shannon and is a popular tourist destination, it also acts as a gateway to County Kerry, Irelands main tourist destination outside of Dublin.

Limerick is well connected and easily accessible by all modes of transport. It benefits from an extensive road / motorway network with drive times to Dublin in 2hrs 25mins, Cork 1hr 40mins and Galway in 1hr 20mins. There are local city bus services operating as well as expressway routes direct to other towns and cities. There are numerous rail connections from Limerick (Colbert) Station connecting Dublin (Heuston) in 2hrs, Cork (Kent) in 1hr 25mins and Galway (Ceannt) in 1hr 55mins. Shannon International Airport is located 33km to the northwest of the subject property providing various domestic and international connections.

CityEast Retail Park is located within an established commercial location, in the immediate area around the park there is also Garryglass Industrial Estate, Delta Retail Park, Eastway Business Park, East Point Retail Park, Monaclinoe Industrial Estate and Crossagalla Industrial Estate, all located on the Ballysimon Road. City East Plaza, a modern office development is located directly opposite the retail park where Northern Trust are the main tenant.

 

P R I M E R E TA I L PA R K I N V E S T M E N T O P P O R T U N I T YC I T Y E A S T R E TA I L PA R K

Catchment AnalysisPopulation Growth 2006 - 2016 Household Expenditure

Permanent Households total 80,184

of catchment area is within the A, B, C1 Socio-Economic Group.

51%

Workforce

Population by Age

< 15 years

15 - 24 years

25 - 44 years

45 - 64 years

65+ years

Average Weekly Spend €790

Limerick

Clarina

Ahane

Craglea

Ballymoylan

Ahane

O’Briensbridge

Nenagh

Dunkerrin

Barrisnoe

Cooleen

Ballagh

Cashel

Tipperary

Tipperary

Kilmallock

Rockhill

Upperchurch

Murroe

Cliggin

Dromkeen

Fedamore

MeanusCarrickettle

CarrigoreillySt Patrickswell

Croom

Milltown(Asceaton)

Rathkeale

Newcastle

Kilmeedy

Curra More

Foynes

Carrickerry

Ballynacally

Ennis

Ballyslattery

Broadford

Shannon

M7

M7

M20

N20

N21

N24

N24

Limerick is well connected and easily accessible by all modes of transport. It benefits from an extensive road / motorway network with drive times to Dublin in 2hrs 25mins, Cork 1hr 40mins and Galway in 1hr 20mins.

2011 216,701

2006 205,362

2016 221,581

+2%+6%

12,927

31,99226,695

4,6321,448

2,490 (not stated)

Per household

0

1

2

34

Total Expenditure

€63,327,489

Housing

€13mGoods & Services

€11m

Food

€9mTransport

€9m

Recreation & Culture

€6mFuel

€3m

Clothing

€2mAlcohol

€2m

52,421

Catchment 221,581 Ireland 4,761,865

46,227

30,001

63,304

29,628

21%

13%

29%

24%

13%

1,006,552

576,452

1,406,291

1,135, 003

637,567

21%

12%

30%

24%

13%

The PropertyCityEast Retail Park was constructed in 2006 and comprises 7 retail warehouse units extending to 16,607.8 sq m (178,764 sq ft) GIA. The scheme is laid out in two detached blocks, the anchor unit occupied by B&Q is a large rectangular shaped building with the other remaining units laid out in an “L” shaped configuration. The retail park sits on a site area of approximately 6.64hectares (16.41 acres) and provides for 525 surface car parking spaces which is free for customers.

Units range in size from approximately

704.00 sq m (7,578 sq ft) to 5,546.2 sq m (59,699 sq ft).

The units are of steel portal frame construction with block work walls and cast in-situ concrete floors with coated metal deck roofs. The current use within the park is restricted to bulky goods. 

P R I M E R E TA I L PA R K I N V E S T M E N T O P P O R T U N I T YC I T Y E A S T R E TA I L PA R K

Site Plan

Future Development

Unit 1a- Planning granted under ref (13/631) for an additional unit extending to approximately 1,427 sq m (15,360 sq ft).

Unit 10A- Planning granted under ref (17/733) for a coffee pod extending to approximately 244 sq m (2,626 sq ft).

Tenancy OverviewCityEast Retail Park is let to seven tenants including B&Q, Harvey Norman, Halfords, Home Store + More and EZ Living.

Top 3 tenants by income

Over 75% of the current income is secured against multinational covenants.

The above areas which are calculated on a Gross Internal Area basis were provided by Murphy Surveys. An assignable measurement survey and detailed tenancy schedule is provided in the dataroom.

Unit Trading As Demise Floor Area Sq m

Floor Area Sq ft Lease Term Start End Rent Review Break Contracted Rent Rent Receivable Comment

1 B&QGround 5,378.5 57,894

20 yrs & 1 day 25/07/2005 25/07/2025 25/07/2020 €590,000 €590,000

Abated rent from €1,208,592 per annum to minimum rent of €590,000 per annum plus 5% of Gross T/O in excess of annual Rental Threshold of €11.8m from 1st April 2013 to 24th July 2020. The next rent review on 25th July 2020 will be the higher of €590,000 per annum or the open market yearly rent. Mezzanine 167.7 1,805

2 EZ LivingGround 833.0 8,966

10 yrs 17/06/2013 16/06/2023 17/06/2018 16/06/2020 €130,000 €130,000Mezzanine 549.6 5,916

3 HalfordsGround 669.2 7,203

20 yrs & 1 day 28/10/2005 28/10/2025 28/10/2020 €183,090 €183,090Mezzanine 438.4 4,719

4 Maxi ZooGround 680.1 7,321

25 yrs & 1 day 24/03/2008 24/03/2033 24/03/2018 €186,354 €186,354Mezzanine 23.9 257

5,6,7 Harvey Norman Ground 4,256.4 45,815

25 yrs & 1 day 09/01/2006 09/01/2031 10/01/2021 09/01/2026 €638,520 €638,520 Break Option clause subject to 12 months notice and 12 months penalty. Mezzanine 78.5 845

8,9 Home Store + MoreGround 1,891.5 20,360

25 yrs & 1 day 07/08/2007 07/07/2032 07/08/2017 €473,525 €473,525Mezzanine 694.3 7,473

10 Home Savers Ground 946.7 10,190 20 yrs 17/05/2018 16/05/2038 17/05/2023 €101,270 €101,270

Rent Deposit Deed- €93,421.58 to act as security and for the future performance of the Tenant. 1/3 will be refunded to the Tenant 21 days after the last day of the second year of the term, 1/3 after the last day of the third year of the term and 1/3 after the last day of the fourth year of the term.

Total 16,607.8 178,764 €2,302,759 €2,302,759

P R I M E R E TA I L PA R K I N V E S T M E N T O P P O R T U N I T YC I T Y E A S T R E TA I L PA R K

Covenant Strength by Income

Income Profile to Expiry Income Profile to Break

Multinational

€1,727,964National

€574,795

25%75%

€0€130,000

€773,090

€1,399,669

€0€200,000€400,000€600,000€800,000

€1,000,000€1,200,000€1,400,000€1,600,000

0 years - 2 years 2 years to 5years

5 years to 10years

10 years +

€0

€1,411,610

€130,000

€761,149

€0€200,000€400,000€600,000€800,000

€1,000,000€1,200,000€1,400,000€1,600,000

0 years - 2 years 2 years to 5years

5 years to 10years

10 years +

BALLYSIMON RD

SERVICE RD

OLD TIPPERARY RD (N24)

SERV

ICE

RDDEVELOPMENT LAND

GARDENCENTRE

NEWLINEARPARK

UNIT 1A

UN

IT

10A

PJ T

HW

AITE

S

FUTURE OPPORTUNITIES

For illustration purposes only

Harvey Norman

28%

B&Q

26%

€638,520

€590,000

Home Store + More

21%€473,525

OTHER TENANTS

€2.3m Rent

Receivable

P R I M E R E TA I L PA R K I N V E S T M E N T O P P O R T U N I T YC I T Y E A S T R E TA I L PA R K

Indicator Period % Change Y/Y

Live Register June 2018 -15.1

Real GDP Q1 2018 +9.1

Overseas Trips to Ireland Q2 2018 +6.6

Real Household Disposable Income (4QMA) Q1 2018 +5.2

Core (ex. Motors) Retail Sales Jun 2018 +4.6

Total Employment Q1 2018 +2.9

Real Personal Consumption Expenditure Q1 2018 +2.7

Real VAT Receipts Jun 2018 +2.4

Real Average Gross Earnings Q1 2018 +2.2

Consumer Sentiment (3mma) June 2018 +1.7

Consumer Credit Outstanding Balances May 2018 +1.2

Sources: CSO, CBI, KBC Bank Ireland/ESRI, Dept. of Finance.

Consumer Economy Dashboard

Every dial on the retail economy dashboard is now pointing in a positive direction.

• Ireland’s economy continues to grow faster than any other EU country.

• Growth forecasts for 2018 and 2019 are 4.8% and 3.9% respectively.

• Underpinning Ireland’s strong consumer economy is a robust labour market, with over 62,000 new jobs created in the last twelve months.

Retail Sales Growth by SectorEconomy going from Strength to StrengthIreland’s economy continues to perform especially well. At 9.1%, total output is rising at a faster annual rate than any other country in the EU. Growth in consumer spending continues to contribute positively to this and expectations are that this trend will continue. Underpinning all of this is jobs growth. Ireland is currently creating 62,100 (+2.9%) additional jobs per annum. As a result, unemployment has fallen to 5.1%, leading to a more

competitive labour market and a sustained period of modest but meaningful earnings growth. Greater numbers at work, coupled with increased earnings and modest tax cuts, have led to strong growth of 5.2% in real aggregate disposable incomes in the last twelve months. Adding to this, sustained growth in consumer credit balances is undoubtedly adding to consumers’ spending power.

Why Invest in Irish Retail

Total Employment – National

Jobs growth continues to underpin economic expansion as total employment increased 2.9% in Q1 2018.

Percentage Change in Real Household Disposable Income (4 QMA)

Increased jobs growth has provided the fiscal space for tax reductions in consecutive budgets, helping to boost household disposable incomes.

2,400

2,300

2,200

2,100

2,000

1,900

1,800

1,700

1,600

1,500

8

6

4

2

0

-2

-4

-6

-8

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Q3

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2018

Q1

(000

s)

% C

hang

e Y/

Y

Source: CSO Source: CSO

Retail Forecast

• In conjunction with ESRI Savills Research has developed an econometric model of retail rents in Ireland.

• In summary, with limited additional rental property being constructed, rents are now rising.

• 3.09% YOY rental growth Q1 2018.

• Model forecasts rental growth of 6.1% between Q3 2018 and Q1 2021.

Retail sales in Hardware, Paint & Glass continue to perform strongly which is reflective of the uptick seen in new home building and renovations.

In addition, furniture, electrical and hardware stores – all of which are commonly associated with housing - continue to enjoy very strong growth in volume sales.

This would seem to reflect improved disposable incomes, sharply rising house prices and the Government sponsored Home Renovation Incentive (HRI) – the latter of which have likely encouraged people to invest more in their homes.

Retail Sales Index by Store Type (3 MMA) - June 2018

14121086420

-2

300

250

200

150

100

50

170

160

150

140

130

120

110

100

90

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Source: CSO

Sour

ce: C

SO

Har

dwar

e, P

aint

and

Gla

ss

Mot

ors

Elec

trica

l Goo

ds

Gro

cery

Phar

mac

y

2006

M10

2007

M04

2007

M10

2008

M04

2008

M10

2009

M04

2009

M10

2010

M04

2010

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2011

M04

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2012

M04

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M10

2013

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2016

M04

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M10

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M04

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M10

2018

M04

Dep

artm

ent S

tore

s

Book

s / N

ewsp

aper

s

Furn

iture

& L

ight

ing

Clo

thin

g &

Foot

wea

r

Bars

Mot

or F

uel

Spec

ialis

t Foo

d

% C

hang

e Y/

Y

Inde

x: Q

1 199

6 =

100

Inde

x: 2

005

= 10

0

1996

Q1

1996

Q3

1997

Q1

1997

Q3

1998

Q1

1998

Q3

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2014

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Q1

2015

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Q1

2017

Q3

2018

Q1

2018

Q3(

f)20

19Q

1(f)

2019

Q3(

f)20

20Q

1(f)

2020

Q3(

f)20

21Q

1(f)

Central Forecast 95% Lower 95% Higher

Electrical Goods Furniture & Lighting Hardware, Paint & Glass

Percentage Change in Retail Sales by Sector - June 2018

14121086420

-2

300

250

200

150

100

50

170

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150

140

130

120

110

100

90

80

70

60

50

40

Source: CSO

Sour

ce: C

SO

Har

dwar

e, P

aint

and

Gla

ss

Mot

ors

Elec

trica

l Goo

ds

Gro

cery

Phar

mac

y

2006

M10

2007

M04

2007

M10

2008

M04

2008

M10

2009

M04

2009

M10

2010

M04

2010

M10

2011

M04

2011

M10

2012

M04

2012

M10

2013

M04

2013

M10

2014

M04

2014

M10

2015

M04

2015

M10

2016

M04

2016

M10

2017

M04

2017

M10

2018

M04

Dep

artm

ent S

tore

s

Book

s / N

ewsp

aper

s

Furn

iture

& L

ight

ing

Clo

thin

g &

Foot

wea

r

Bars

Mot

or F

uel

Spec

ialis

t Foo

d

% C

hang

e Y/

Y

Inde

x: Q

1 199

6 =

100

Inde

x: 2

005

= 10

0

1996

Q1

1996

Q3

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1997

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1998

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2010

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Q1

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Q1

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2014

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2015

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2017

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2018

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2018

Q3(

f)20

19Q

1(f)

2019

Q3(

f)20

20Q

1(f)

2020

Q3(

f)20

21Q

1(f)

Central Forecast 95% Lower 95% Higher

Electrical Goods Furniture & Lighting Hardware, Paint & Glass

Overall Retail Rent Index

Overall Rents Forecast Q2 2018 - Q1 2021

300

250

200

150

100

50

Inde

x: Q

1 199

6 =

100

1996

Q1

1996

Q3

1997

Q1

1997

Q3

1998

Q1

1998

Q3

1999

Q1

1999

Q3

2000

Q1

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2001

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2003

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2005

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Q3

2007

Q1

2007

Q3

2008

Q1

2008

Q3

2009

Q1

2009

Q3

2010

Q1

2010

Q3

2011

Q1

2011

Q3

2012

Q1

2012

Q3

2013

Q1

2013

Q3

2014

Q1

2014

Q3

2015

Q1

2015

Q3

2016

Q1

2016

Q3

2017

Q1

2017

Q3

2018

Q1

2018

Q3(

f)20

19Q

1(f)

2019

Q3(

f)20

20Q

1(f)

2020

Q3(

f)20

21Q

1(f)

Central Forecast 95% Lower 95% Higher

+6.1%

ContactSelling Agents

Savills 33 Molesworth St Dublin 2 PSRA 002233

Dessie Kilkenny +353 (0) 1 618 1401 dessie.kilkenny@savills.ie

Brendan Delaney +353 (0) 1 618 1715 brendan.delaney@savills.ie

Peter O’Meara +353 (0) 21 490 6114 peter.omeara@savills.ie

Solicitor

Beauchmaps Riverside Two Sir John Rogerson’s Quay Dublin 2

Maitiú Ó Dónaill +353 (0) 1 418 0657 m.o’donaill@beauchamps.ie

DISCLAIMER: These particulars are issued by Savills Ireland on the understanding that any negotiations relating to the property are conducted through them. While every care has been taken in preparing them, by Savills Ireland for themselves and for the vendor/lessor whose agents they are, give notice that: - (i) The particulars are set out as a general outline for guiding potential purchasers/tenants and do not constitute any part of an offer or contract. (ii) Any representation including descriptions, dimensions, references to condition, permissions or licenses for uses or occupation, access and any other details are given in good faith and are believed to be correct, but any intending purchaser or tenant should not rely on them as statements or representations of fact but must satisfy themselves (at their own expense) as to their correctness. (iii) Neither by Savills Ireland, nor any of their employees have any authority to make any or give any representation or warranty in relation to the property. August 2018. Designed and produced by Creativeworld. 01282 858200

ViewingsAll viewings are strictly by appointment through the sole selling agent.

PricingGuide Price excess €28,000,000 (subject to contract), which represents a net income yield of 7.58% after standard purchaser’s costs of 8.46%.

BER Rating

VATWe understand transfer of business relief should apply to the sale.

TitleWe understand that the property is held Freehold.

Data Site www.cityeastretailpark.com