One of Ireland's biggest distribution hubs has been put up for sale with a €165 million price tag by its Korean owner. The distribution centre, developed and let to Tesco in Donabate, north Dublin, extends to 788,069 sq ft (73,214 sq m) and is among the largest logistics buildings in Ireland.

Tesco is a British supermarket group listed on the London Stock Exchange under the ticker TSCO, headquartered in Welwyn Garden City, England. The company reported group sales of £61.5 billion and adjusted operating profit of £2,829 million for the year to February 2024.

The facility is owned by KTB Investments & Securities and KTB Asset Management, South Korean financial institutions, which acquired it through DTZ Investors in an off-market deal for €160 million in 2019.

The sale comes amid strong demand for logistics and industrial properties in Ireland, boosted by e-commerce activity, and follows the record €500 million sale of Horizon Logistics Park near Dublin Airport to GIC and Valor earlier this year.

The structural driver is the scarcity of large-scale, long-let logistics assets in the Irish market, with investors drawn to secure, inflation-linked income streams backed by blue-chip covenants.

The property occupies a 48-acre site with access to the M1 motorway, linking it to the M50, Dublin Airport, Dublin Port and Dublin city centre, and is equipped with 80 dock levellers, loading bays, 50-metre deep service yards and an on-site wind turbine. Its lease runs until December 2040, with annual inflation-linked rent reviews capped at 3.5 percent a year.

Kevin Donohue, head of capital markets at Cushman & Wakefield, said, "The Tesco distribution centre in Dublin is an exceptional asset offering investors the opportunity to acquire an important logistics facility underpinned by a long-term lease to Tesco, annual CPI-linked rental growth and the security of a blue-chip covenant. Opportunities of this scale, quality and income durability are exceptionally rare in the Irish market."

Ireland's industrial and logistics sector has accelerated in recent times, with rents growing 4.89 percent over the 12 months to the end of June and investor returns rising 8.32 percent, according to the MSCI Index. Take-up of space reached 618,900 sq ft in the second quarter, a 12.6 percent increase year-on-year.

For the sector, the listing underscores continued investor confidence in Irish logistics assets despite a broader slowdown in European commercial property transactions.

Source: Independent.ie / Cushman & Wakefield