Property firm to spend €47m on city centre site of U2's former studios
Irish property investment company Hibernia Reit has arranged a new €46.7m debt facility with Deutsche Bank to develop the iconic Windmill Lane site, once home to a recording studio used by U2.
The company has formed a joint venture with an affiliate of American investment firm Starwood Capital to develop the project.
They aim to develop more than 120,000 sq ft of offices, around 7,000 sq ft of retail, and 15 residential units at the Dublin site, which is due to be completed in late 2017.
The €46.7m facility has a term of three years and an option to extend for a further year. It is secured on the Windmill Lane property. Hibernia said the facility will be used to fund the development of the one-acre site.
The site held U2's studios at Windmill Lane but it was taken over by the Dublin Docklands Development Authority a decade ago.
As part of that deal, U2 was to get a studio in the planned 'U2 Tower' on Britain Quay. However that has not been built.
The Windmill Lane studios, located in Dublin's south inner city, was the iconic site for a host of top international music acts who recorded tracks going back to the 1970s, when they were opened by Brian Masterson.
However, it was Bono and U2, who recorded parts of The Joshua Tree album at the site, who were best associated with Windmill Lane. The actual studios were moved out of Windmill Lane and relocated to Ringsend some time ago.
The Windmill Lane studio has now been demolished, but Hibernia has retained a 20-metre stretch of the graffiti wall on the front of the studio and is working with two museums who are interested in using the wall in their displays.
Hibernia Reit, which only began trading before Christmas, agreed terms to buy the site on Windmill Lane from Starwood in June 2014 for €7.5m and the loans held against an adjacent office block for an additional €20.16m.
As part of the deal, Starwood was granted an option to buy back in as a 50/50 joint venture partner at purchase price plus a return of 7pc, plus costs incurred by Hibernia.
Starwood said it will pay €4.9m for its share in the joint venture, to be known as Windmill Lane Partnership, to which ownership of the site will transfer. Future income and expenditure will be shared equally.
Hibernia chief financial officer Tom Edwards-Moss said the facility gives the Windmill Lane Partnership flexible development funding to deliver "best in class" office space.