commercial property falls 87% in ireland

http://www.kerryman.ie/news/government-office-cost-euro-162m-now-its-valued-at-euro-2m-2949748.html

Government office cost € 16.2m, now it's valued at € 2m

By KEVIN HUGHES

DECENTRALISED government offices in Killarney, bought for €4.5million in 2005 and developed with a further €12 million, would be hard pushed to make over €2 million on today's market according to property experts.

The Department of Tourism, Culture and Sport headquarters were to be one of the Fianna Fáil government's showcase sites when the decentralisation project was announced in 2003. The building was expected to house 140 employees from the former Department of Arts, Sports and Tourism and over 30 Irish Sports Council employees but less than 80 jobs have been based there.

The final nail in the project came last week following confirmation that The Irish Sports Council will not relocate to the town after almost 40 decentralisation projects nationally were axed.

The one-acre plus site was the second most expensive under the decentralisation scheme with the OPW paying €4.5million for the former Jimmy the Master's Garage and €11.7million was spent building new offices. Rent for temporary offices to house staff before the offices opened came to €140,000.

Estate agents in the town this week told The Kerryman that the building would make a maximum of €3million at current property values, but would probably make closer to €2million if owner-occupied. The huge drop is down to the fact that there is a significant amount of office based premises available in Killarney.

"The Jimmy The Master's site also wouldn't make €500,000 in today's market," one estate agent added.

The Office of Public Works (OPW) says it will now "review space utilisation" within the Killarney facility following last week's news.

Killarney Mayor Seán Counihan, meanwhile, says that the building should now be used as a one-stop shop to include a number of services.

Cllr Counihan said the building is massively under-used and could be developed to include town council offices, as well as national and local employment services, social welfare offices and even MABS.

Killarney Town Council currently rents premises for administration purposes adjacent to the town hall for €130,000 per annum.