Airport Hotel Investment for Sale by Private Treaty

The Premier Inn in Swords, Co Dublin is being brought to the market by CBRE at a guide price of €9.6 million

October 2014 – The Premier Inn in Swords, Co Dublin is being brought to the market by CBRE at a guide price of €9.6 million.

The property comprises a modern three star hotel which extends to 1,006 sq. m. in total. The hotel is purpose built and accommodation includes 155 ensuite air conditioned Bedrooms, bar and lounge, restaurant, conferencing facilities to seat 75, on-site parking and ‘park and fly’ facilities. The hotel has 236 car spaces including 2 coach spaces, situated on a site of 1.7 acres.

The hotel was refurbished in the last 5 years and is in excellent condition throughout. The ground floor of the hotel provides the main reception area, restaurant, bar, meeting rooms, staff facilities, a small games room and 5 guest bedrooms. The reminder of the guest rooms, which are a mixture of double and family rooms, are on the 5 upper floors, 30 rooms per floor. There is a planning permission for an extension providing a further 55 bedrooms which may provide an opportunity for the hotels expansion. This planning permission will lapse in October 2015.

The hotel is located at the entrance to the Airside Retail Park strategically situated just 2.5 km from Dublin Airport. The Premier Inn occupies a pivotal trading location. The hotels popularity is also strengthened by the wide range of services made available in the retail park including restaurants and shopping opportunities.

The Hotel is let to P.I. Hotels Limited with a parent company guarantee from Whitbread Group plc. under a full repairing and insuring lease. The term is 25 years from October 2005 incorporating upward only reviews every five years at a current annual rent of €650,000 so there are over 16 years remaining on the lease. Premier Inn Dublin Airport is the only Premier Inn branded hotel in the Republic of Ireland. The hotel chain however operates 650 hotels throughout the UK. There is an additional income of €24,750 generated from the lettin​g of two telephone communications masts bringing the total income to €674,750 per annum.

The Hotel market has witnessed a significant improvement in trading over the last three years with all key performance indicators registering growth. In addition passenger numbers at Dublin Airport exceeded 20m in 2013 and has continued the trend of increasing tourism and business travel over the past two years. With increasing connectivity this growth of passengers at the airport is expected to continue in the years ahead. The airport provides links to UK, mainland Europe, North America and the Middle East with approximately 170 routes served by 55 airlines.

At a €9.6 million this opportunity would provide an investor with an initial return of 6.75%. While yields in the Republic have strengthened the yield proposed by the agents looks attractive when compared to a Premier Inn that sold in Belfast for over £9 million last October where the investor settled for a yield of 6%.

According to selling agents CBRE “This investment is likely to generate considerable interest from both Irish and international investors as the long unexpired term and very strong tenant are hard to find in the market. In addition the income is protected by upward only rent reviews and the current rent equates to €4,200 per room which offers excellent prospects for rental growth over the remaining term of the lease.”​