KILLARNEY OUTLET CENTRE

Killarney, Co Kerry

FOR SALE BY PRIVATE TREATY TENANTS NOT AFFECTED

EXECUTIVE SUMMARY

Potential to increase

rent roll through asset management and letting the

vacant space

€

8,407 sq. m (90,497 sq. ft.) of retail

accommodation

€

2.08 hectare (5.14 acre site)

€

230 surface

car spaces

€

Highly Accessible Prominently positioned in

the centre of Killarney Town, immediately adjoining Killarney

Train and Bus Stations

€

Producing a gross

rental income of

€991,262 per annum

Strong tenant mix Nike, Costa Coffee, DV8, The

Works, Tiger and Pavers

€

€

IRISH RETAIL SALES

80

85

90

95

100

105

110

115

120

125

2007M08

2008M02

2008M08

2009M02

2009M08

2010M02

2010M08

2011M02

2011M08

2012M02

2012M08

2013M02

2013M08

2014M02

2014M08

2015M02

2015M08

2016M02

2016M08

Inde

x Ba

se 2

005

= 10

0

All retail businesses All retail businesses, excluding motor trades

SOURCE: CSO

WHY RETAIL?

THE IRISH ECONOMY

Conditions in the domestic Irish economy remain buoyant with

GDP growth of 4.9% expected to be achieved in 2016, making

it the best performing economy in the Eurozone for the third

year running.

Economic activity is quite broad based and benefiting from a

strong recovery in the services sector and domestic retail sales

in particular. Indeed, retail sales volumes look set to record

an enormous 7% expansion in 2016 as consumer confidence

improves. Meanwhile, household debt levels continue on a

downward trajectory.

NATIONAL QUARTERLY EARNINGS AND LABOUR

1,350,000

1,400,000

1,450,000

1,500,000

1,550,000

1,600,000

1,650,000

1,700,000

1,750,000

1,800,000

650

660

670

680

690

700

710

720

730

€

Employment (Number) Average Weekly Earnings (Euro)

2008 Q1

2008 Q3

2009 Q1

2009 Q3

2010 Q1

2010 Q3

2011 Q1

2011 Q3

2012 Q1

2012 Q3

2013 Q1

2013 Q3

2014 Q1

2014 Q3

2015 Q1

2015 Q3

2016 Q1

SOURCE: CSO

EMPLOYMENT

Employment in the Irish economy grew by 2.9% in the year

to Q2 2016 with the unemployment rate falling to 7.9% in

September – its lowest level in more than 8 years. Average

weekly earnings rose 1.5% y/y to €713.41 in Q1 2016, which

is the sixth quarter of consecutive wage growth and likely

reflects the tighter labour market conditions in Ireland.

DEMOGRAPHICS

Ireland has one of the most youthful populations in

Europe which is particularly attractive for retailers,

especially as we have one of the highest proportions of

25-39 year olds in the continent. The most recent Census

of Population 2016 shows population growth of 3.7%

since 2011 nationally and by 1.4% in Kerry specifically.

IRELAND’S POPULATION BY AGE GROUP

10.0% 8.0% 6.0% 4.0% 2.0% 0% 2.0% 4.0% 6.0% 8.0% 10.0%

0 - 4 years

5 - 9 years

10 - 14 years

15 - 19 years

20 - 24 years

25 - 29 years

30 - 34 years

35 - 39 years

40 - 44 years

45 - 49 years

50 - 54 years

55 - 59 years

60 - 64 years

65 - 69 years

70 - 74 years

75 - 79 years

80 - 84 years

85 years and over

Ireland Europe

By A

ge G

roup

SOURCE: CSO and Eurostat 2014

RETAIL AVAILABILITY

CBRE’s vacancy audit of prime regional retail high streets, which is

carried out bi-annually, shows that Killarney has consistently held

one of the lowest levels of ground floor vacancy in the country,

standing at 2.0% in Q1 2016, in comparison to other strong retail

towns such as Galway which stood at 2.8% in the same period and

Cork at 9.5%.

Following a period of extensive development between 2005

and 2009 when the amount of retail park and shopping centre

accommodation in Ireland effectively doubled, there has been

virtually no development in the sector since. This is during a period

when the national population has increased by 3.7% between 2011

and 2016. The total stock of shopping centre accommodation (over

5,000 square metres in size) in Ireland is approximately 1.78 million

square metres (19 million square feet).

IRISH RETAIL STOCK 1996-2016

0

0.5

1.0

1.5

2.0

2.5

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

2016

Mill

ion

Sq M

Shopping Centres Retail Parks

SOURCE: CBRE

LOCATION

Killarney is located in the South West of Ireland in County Kerry,

approximately 308 km from Dublin, 111 km from Limerick City and

85 km from Cork City.

Killarney Outlet Centre is situated in the heart of Killarney Town,

on the main vehicular route (R876 regional – Limerick Road).

Killarney Outlet Centre occupies a prominent corner profile onto

Fairhill, where it benefits from being highly visible from one of the

main thoroughfares into the town. Killarney Bus Station adjoins

Killarney Outlet Centre and Killarney Train Station is located

immediately adjacent to the scheme.

Killarney is the second largest town in County Kerry with a

population of 14,219 (census 2011). Killarney is a thriving tourist

destination, forming part of the famous scenic route The Ring of

Kerry, and well known for its attractions such as Killarney National

Park, Muckross Abbey, Ross Castle, MacGillycuddy’s Reeks and Torc

Waterfall. Killarney attracts thousands of tourists each year and

currently has the highest concentration of hotel bedrooms outside

of Dublin. The Malton Hotel, Killarney Park Hotel and Scotts Hotel

are all within a few minutes’ walk of Killarney Outlet Centre.

Killarney Town is serviced by public transport in the form of bus

and rail services. Bus Eireann provide frequent bus services to

Dublin and other regional counties from Killarney Bus Station.

There are also several private bus operators servicing Killarney

Town and supporting its tourist industry. Killarney Train Station

adjoins the site, providing a steady flow of pedestrian traffic

throughout the day. Killarney Station provide trains to Tralee,

Dublin and Cork.

Tourism has grown steadily nationally each quarter to stand at 2.6 million

overseas visits by non-residents in Q2 2016 alone. Kerry and in particular

Killarney welcomes a strong proportion of these visitor numbers due to

its natural beauty, activity offerings, good rail connectivity and welcoming

environment. Indeed according to the most recent regional tourism numbers

produced by Failte Ireland in October 2016, Kerry welcomed over 1.02

million overseas visitors to its towns in 2015, creating additional revenue of

over €234 million for the county, while an additional 779,000 Irish residents

also chose the county as their main destination over 2015 spending over

€202 million during their stay.

Larne

LoughNeagh

Bantry

Killybegs

Coleraine

Portrush

Dundalk

ValentiaIsland

Listowel

Lahinch

Carlingford

Armagh

Clifden

Adare

Blarney

Enniskerry

Kenmare

Youghal

Donegal

Sligo

Ennis

KILLARNEYTralee

Westport

Enniscorthy

LetterkennyDerry

Arklow

Knock

Wexford

Galway

Waterford

Belfast

Shannon

Kildare

Cong

CORK

LIMERICK

DUBLIN

1

2

3

4

5

6

7

9

810

11

12

1 Killarney Community College

2 St. Mary’s Cathedral

3 Killarney Town

4 Killarney Plaza

5 High Street

6 Scott’s Hotel

7 Killarney Royal Hotel

8 Killarney Park Hotel

9 Malton Hotel

10 Killarney Train Station

11 Killarney Bus Station

12 R876 Limerick Road

DESCRIPTION

Killarney Outlet Centre was constructed in 1998. The centre

comprises approximately 8,407 sq. m. (90,497 sq. ft.) of retail

accommodation on a site of 2.08 hectares (5.14 acres). Killarney

Outlet Centre is a two storey development comprising 39 retail

units over ground and first floor levels. The retail units are laid out

in a linear format alongside a central mall, which provides excellent

circulation space and plentiful natural light. There are two entrance

points to the centre, providing access from both Killarney Town and

the Limerick Road (R876).

The ground floor comprises 20 retail units which range in size from

93 sq. m. (1,000 sq. ft.) to 678 sq. m. (7,300 sq. ft.). The retail units

benefit from between 6 metres and 26 metres of frontage onto

the central mall. There is an ATM located at ground floor level in

addition to several kiosk units. There are two escalators, a

passenger lift and several staircases which provide access to the

first floor. There are 18 retail units at first floor level in addition to

staff and customer WC facilities, management offices and storage

rooms. The centre is surrounded by a perimeter service corridor,

which provides loading access for deliveries. There is a goods lift

within the service area for deliveries to the first floor.

Killarney Outlet Centre has generous car parking for 230 car spaces

and 3 coach spaces. The car park is accessed off Fairhill and is paid

parking operated by Euro Car Parks. Killarney Bus Station forms

part of the overall scheme, situated at the eastern elevation of the

centre. The bus station has its own entrance from the car park in

addition to a connecting access point into Killarney Outlet Centre.

BUS STATION

STAIRS

6m 6m 6.2m 7.6m 6m 6m 6m 6m 9.2m 6m 6m 6m 7.6m 6.2m 6m

27

6m6m6m6.2m7.6m

6m 6m6m9.2m6m6m6m6m14m6m 6m

PAVERS OUTLETTRES

SPA

SS

11 12 15 16 17 18 19

36 31 30 29 28

20 21 22 23 24

3233343738394041

26

13 14

35

KILLARNEY RAILWAY STATION

PACO

BRANDSFORLESS

RELOAD(BEST

SELLERGROUP)

NIKETIGER MANGOCRAFTS

25

LEADING LABELSCOSTACOFFEE THE WORKS EUROGIANT DV8

HOLLAND& BARRETT CLAIRE’S

KERRYGAA

STORE

BAGS ETC

SONA7271

LIFT

ESCALATORESCALATOR

TRADING VACANT RESERVED

TRADING VACANT OFFICES TOILETS

STAIRS

42 43 44 45 46 47 48 49 50 51 52 53 54 55

56

57585960616263646566676869

LIFT

ESCALATORESCALATOR

ARMY SURPLUS WAREHOUSE HOME DEPOT

O’BRIEN’SMANAGEMENT

OFFICES

OFFICES

NIKESTOCK ROOM

UNBOUND

GROUND FLOOR

FIRST FLOOR

TENANCY• Contracted income of €991,262 per annum

• 18 high quality tenants including renowned national

and international brands such as Nike, Costa Coffee,

Claires Accessories, Tiger and Pavers

• There have been a number of new lettings and

existing retailers are extending lease terms, showing

commitment to the centre.

• Opportunity to increase the rental income through

asset management and letting vacant space

TOP 5 TENANTS

Nike

Leading Labels

Pavers Shoes

Creeslough Retail Ltd. t/a DV8

The Works Stores Ltd. t/a The Works

27%

20%21%

15%

17%

SOURCE: CBRE

TOP 5 TENANTS (BY INCOME)

UNIT TENANT AREA SQM CONTRACTEDRENT*

STARTDATE

TERM YEARS

EXPIRY/ BREAK OPTION

22-24 Nike BV Ltd. t/a Nike 7,386 €109,256 26/07/2014 5 26/07/2019

39-41 Leading Labels 6,382 €80,000 01/06/2015 5 01/07/2020

17-18 Pavers Shoes 3,140 €87,629 01/07/2014 5 01/07/2019

31-33 DV8 4,078 €60,000 01/07/2014 5 01/07/2017 (BRK)

34 The Works 2,269 €70,825 01/07/2014 5 01/07/2019

7,985 €407,710

*Rent calculated on base rent plus turnover top ups (2015) where applicable.

Top Five Tenants €407,710 per annum

NIKE – Nike is an American multinational sportswear brand that

specialises in footwear, clothing, equipment and accessories. Nike is the

world’s largest supplier of sports footwear, employing 62,000 people

worldwide and having a net income of over $3 billion in 2015. Nike

anchor Killarney Outlet Centre with a large outlet store, stocking a wide

range of men’s, women’s and children’s clothing and footwear.

LEADING LABELS – Leading Labels is a UK clothing retailer which was

established in 1988. The company stocks well-known brands of both

menswear and womenswear including Ben Sherman, Wrangler, Jack and

Jones, Elle and Pringle. The company operates 19 stores across the UK and

the Republic of Ireland.

THE WORKS – is a British retailer selling discount Art and Craft items, toys,

books and stationery. The Works operates 350 stores throughout the UK

and have three stores in the Republic of Ireland, two in Dublin and one in

Killarney Outlet Centre.

DV8 – DV8 is a fashion and footwear retailer stocking branded and own

branded clothing for men and women. DV8 originates in the UK and

currently opearates over 40 stores in the UK and the Republic of Ireland.

PAVERS SHOES – Pavers Shoes is a family owned footwear business

operating in the UK and Ireland. Pavers stock a wide range of well-known

brands such as Skechers and Padders. The company currently operates

115 stores throughout the UK and Ireland and have recently launched an

online store through their website.

ASSET MANAGEMENT POTENTIAL• There is opportunity to increase the occupancy rate through letting the upper floor space. Current tenants on the first floor currently trade well

with footfall being created through O’Brien’s Sandwich Bar. The addition of further service tenants and food and beverage operators would be highly

beneficial to the first floor space.

• There is opportunity to re-gear leases and implement longer lease terms, thereby increasing the WAULT. Killarney Outlet Centre has traditionally

been let on 5 year lease terms. We believe there is demand from both new and existing tenants to take longer terms in the centre.

• The introduction of new complimentary retailers would further enhance the offering of the scheme. Killarney High Street has the lowest vacancy

rate of any regional town in the country. Killarney Outlet Centre provides an opportunity for occupiers to locate within the town centre and alongside

key retailers who drive footfall in the scheme.

• There is potential to increase the food and beverage offering in the scheme (subject to planning permission). This would allow the centre to cater

for its tourism and family orientated customer base.

COVENANTS

DISCLAIMER: These particulars are issued by CBRE Ireland on the understanding that any negotiations relating to the property are conducted through them. While every care has been taken in preparing them, CBRE Ireland for themselves and for the vendor/lessor whose agents they are, give notice that:- (i) The particulars are set out as a general outline for guiding potential purchasers/tenants and do not constitute any part of an offer or contract. (ii) Any representation including descriptions, dimensions, references to condition, permissions or licenses for uses or occupation, access and any other details are given in good faith and are believed to be correct, but any intending purchaser or tenant should not rely on them as statements or representations of fact but must satisfy themselves (at their own expense) as to their correctness. (iii) Neither CBRE Ireland, nor any of their employees have any authority to make any or give any representation or warranty in relation to the property. CBRE Ireland PSRA Licence No: 001528

TITLEThe property is held under a long leasehold interest

(250 years) with CIE from 1st July 1999.

TOWN PLANNINGKillarney Outlet Centre is located in an area zoned

‘Town Centre’ in the Killarney Town Development Plan

2009 - 2015.

BER RATINGBER Rating: C1

BER Numbers: 800516080

Energy Indicator: 183.71 kWh/m²/yr 1.07

SOLICITORSArthur Cox Earlsfort Centre, Earslfort Terrace, Dublin 2

CONTACT John Walsh Tel: 00353 1 6180000Email: john.walsh@arthurcox.com

CONTACT

Viewings by Appointment with the

Sole Selling Agent.

JOHNNY HORGAN Executive Director/Head of Investment Properties Tel: 00353 (1) 6185797Email: johhny.horgan@cbre.com

FIONA KENNEDYSenior Surveyor, Investment Properties Tel: 00353 (1) 6185742Email: fiona.kennedy@cbre.com

NIAMH SHEAHANAssociate Director, Retail Agency Tel: 00353 (1) 6185576Email: niamh.sheahan@cbre.com