Aldi Sandyford store at €10.75m promises ‘pandemic-proof’ 5.1% return – The Irish Times, May 19 2021

South Dublin supermarket let to German retailer until 2036 producing €603,376 rent
Ronald Quinlan

The prospect of eight years of secure investment income from the pandemic-proof supermarket sector is expected to see strong interest in the sale of German retailer Aldi’s store in Sandyford, Dublin 18.

At a time when the Bank of Ireland has signalled its intention to apply negative interest rate on accounts holding more than €1 million, the investment may well prove attractive to private Irish investors looking to preserve and enhance their existing wealth. The long leasehold interest in the property is being offered to the market by Patricia Ward and Ryan Tyrell of agent TWM at a guide price of €10.75 million, subject to the Aldi lease. This provides a return of 5.1 per cent after standard costs of 9.96 per cent have been deducted.

The Aldi store is located immediately opposite the Stillorgan Luas green line stop and is part of the Rockbrook development of apartments and retail units. Aldi is located beside Rationel Windows and Doors and EZ Living. The ground-floor purpose-built supermarket extends to 1,879sq m (20,226sq ft) with 100 basement car-parking spaces with travelator and lift access.

I-Res Reit has been granted planning permission by An Bord Pleanála to build 428 new units at Rockbrook, immediately adjacent to Aldi. The permission was granted through the Government’s fast-track strategic housing development planning process following extensive engagement with Dún Laoghaire-Rathdown County Council.

Aldi has traded from the Sandyford unit since 2011 and its lease expires in 2036. There is a tenant break option in October 2029.

The current passing rent is €603,376 per annum and the next rent review is October 2021. Rents are reviewed in line with the consumer price index, are compounded annually, and are subject to a yearly maximum increase of 4 per cent.

Aldi Stores (Ireland) Limited is a wholly-owned subsidiary of the UK parent company. Aldi entered the Irish market in 1999 and currently operates more than 140 stores across Ireland with plans to open many more. According to research conducted by Kantar Worldpanel (December 2020), Aldi saw its sales increase by 14 per cent annually to achieve a 12 per cent market share in Ireland.