Dunnes Stores to give up an anchor Ilac Centre unit: ThePost.ie


TCH Archives > Sunday Business Post > 2005/12/11 > Dunnes Stores to give up an anchor Ilac Centre unit

Dunnes Stores to give up an anchor Ilac Centre unit
Sunday, December 11, 2005 - By Neil Callanan
Dunnes Stores is to surrender the lease to one of its anchor stores in the Ilac Centre in Dublin city centre, and the unit will be redeveloped into three to five shops.

The 6,500-square metre unit is at the Moore Street end of the complex, where the owners of the Ilac Centre expected footfall to increase following the construction of the Carlton cinema site scheme, which is across the road from the centre. However, the decision by the city council to list buildings on Moore Street may complicate those plans.

Joint agents Bannon Commercial and HWBC are also planning to market the Parnell Street mall area of the Ilac, where McDonalds and Burger King are both currently based, as a food destination area.

“The Ilac Centre is a work in progress.” said Rod Nowlan of Bannon Commercial. “Renovations on two of the malls have been completed and €60 million is being spent on upgrading. It's an opportunity as a tenant-mix exercise in a prime Dublin city centre location. Rents in the shopping centre are dramatically undervalued when compared to Henry Street,” said Nowlan.

Zone A rents of €2,583 per square metre are being achieved on units in the Ilac Centre, but most of the retailers are currently paying €1,507 per square metre Zone A.

“We would hope to set €2,960 per square metre Zone A level for any new units,” Nowlan said.

By contrast, although there's little rental evidence on Henry Street, Zone A rents of around €6,000 per square metre would not surprise the market.

Neil Bannon said that the former Dunnes Stores supermarket and drapery store that fronted on to Henry Street and Moore Street will link into the centre after it is rebuilt as a 13,470-square metre flagship store selling drapery and convenience type groceries similar to those on offer at the retailer's South Great George's Street store.

Dunnes will retain its other unit at the Mary Street end of the Ilac Centre.

“The Ilac Centre is unique in that it's a 5.6-acre site in Dublin city centre with more anchors pro rata than any other scheme,” Bannon said.

“Value will be adding by enhancing the tenant mix. At present, it's an unplanned, market-led tenant mix. A controlled tenant mix will add value to any property - the key is the Parnell Mall and that's the start of the process.”

The height of the centre will rise by 3.2 metres and two bulkheads in the central part of the mall will be removed.

The plan is to create the feel of a full-length street parallel to Henry Street with double height shops all along the passageway.

As Bannon put it, at present the prime part of the centre is the Mary Street mall, where H&M recently opened. The intention, however, is to change that to make the central part of the mall the focus for retailers and shoppers.

For tenants looking for units around Henry Street, the Ilac Centre will be able to provide units of a suitable size before anybody else, Bannon said.

The renovations will be completed by July 2006 and traders in the new shops in the former Dunnes Stores could expect to be trading by Christmas 2007.

Arnotts, expected to submit a planning application for a redevelopment before Christmas, will probably be in planning for three years before it can offer retailers new space.

Developer Joe O'Reilly bought half the Ilac Centre in a personal capacity from British Land in June. British Land had been approached by O'Reilly on a couple of occasions in the year prior to the purchase and the actual negotiations on the sale took two to three months.