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Deka and ING finance Dublin’s One Spencer Dock

The Dublin docklands office building is DekaBank’s second large financing in Dublin.

Two European banks have financed the purchase of the largest prime office building in Dublin, Real Estate Capital can reveal.

DekaBank led the €144 million financing for Middle Eastern buyer AGC Equity Partners’ €242 million acquisition of One Spencer Dock.

ING Real Estate Finance was the second lending bank. In the joint underwrite, Deka lent €88 million and ING, €56 million.

The Dublin docklands office building is DekaBank’s second large financing in Dublin since the German bank resumed looking for lending opportunities in Ireland about two years ago. In early 2015 Deka lent €55.2 million to US investor Hines for its acquisition of largely government-let Bishop’s Square in the city.

One Spencer Dock was a NAMA-backed sale by joint EY receivers and Irish investor Davy Real Estate. AGC Equity Partners, based in London, acts on behalf of Middle Eastern capital.

The 21,054 square metre (226,624 square foot) block at North Quay Wall, is let on three co-terminus leases to PwC until 2032, giving 16 years income. The total rent is almost €11.8 million per annum.

PwC, the largest professional services and accountancy firm in Ireland, employs 1,800 people there. Some of the space is sublet.

The building went on the market last October through Savills and CBRE and had been under offer to Hines.

After Hines withdrew, AGC stepped in and the sale was announced in August, going through at the original circa €240 million asking price. AGC is said to have legally contracted to go ahead on the day of the UK EU referendum on 23 June according to the Irish Times.

The paper said the sale will boost the Dublin office market amid speculation in Ireland that its capital city may benefit from some UK-based companies opting to relocate, or site expansion, in Dublin, after the Brexit vote.

Savills’ Fergus O’Farrell said the sale was a “milestone” for the Irish investment market which reflected strong investor confidence..

Joint EY receiver, Luke Charleton, said there had been interest from domestic and international investors: “This is a successful outcome which reaffirms the international interest in Dublin.”

DekaBank lends in North America, selectively in Asia, France, Italy and Germany as well as the UK & Ireland and said it is targeting €4 billion of new lending in those markets this year.

Speaking about the financing, ING’s head of REF Western Europe, UK, USA, and structured products, Mike Shields said: “The One Spencer Dock transaction in Dublin is a great property with excellent sponsorship – our two main boxes we need to check for any deal.”