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Service stations which were closed down and sold to property developers
are now reopening to sell petrol. Other closed service station which
had planning permission for apartment blocks and other developments -
are now operating as car washes.
Examples in Dublin include the former well known Shell service
station on Merrion Road, a major commuter route, which was sold for €16
million in 2006 for redevelopment but has now reopened as a
service station but not as a Shell brand. Another major commuter
route close by is the Stillorgan Road where a former Texaco service
station fetched €12 million for redevelopment. It to is now
reopening to sell fuel. Other sites in Dublin include one in Kimmage
Road Lower, turned down for apartments, a Texaco garage in Drimnagh
Road, bought for development but refused permission, and a Texaco
service station in Ringsend Road, which closed for more than a year and
has now reopened under new ownership.
Several service station sites were sold by Topaz, which had bought
Shell’s retail and commercial fuels business in 2005 for about €180
million, and paid a reported €280 million for the Statoil business the
following year. Topaz, which is majority owned by Irish private
equity firm Ion Equity, recouped at least €80 million by selling
service stations for property development. It now operates 108
company-owned stations and sells to 210 dealers and is one of the
leading petrol retail brands in Ireland.
Frank Bergin, COO, Topaz, commented to local media ‘‘People saw
alternative-use value and made offers, but what they offered for the
sites was certainly speculative. When we bought Shell, we sold
nine stations in the greater Dublin area for development, but a number
have now come back into use. Of the nine, we vacated six and stayed in
occupation of three because the developer wasn’t ready to proceed. We
had caretaker agreements while the developers sought planning, and we
remain retailing on those sites.
‘‘Some of the other six have closed and some have come back onto the
market. One in Parnell Road is now a car wash, another in Greystones is
a shop. One out beyond St Vincent’s hospital is now run by Texaco.
Ashurst on the Stillorgan Road, which was sold in 2006, will
re-open shortly as a petrol station."
Great Gas, which was formed in 2005 as an alternative supplier to the
independent petrol retail sector, is also looking at reopening a number
of closed service stations. The company supplies 60 garages and has 36
independently-owned stations with its brand, and controls four.
Managing director Ray O’Sullivan said: ‘‘We leased the petrol station
in Santry close to Dublin Airport in June - the first unmanned service
station in Ireland - and we are looking at two in Limerick and Cork
City. They had all been closed for development, and one had permission
for a mixed-use development.
Sullivan said that, despite the closure of so many businesses, a good
service station could still be profitable. ‘‘The profit margin on fuel
is 5-7 per cent and, on a shop, 20-28 per cent. A good site could turn
over €100,000-€120,000 a week on fuel and up to €100,0 00 a week on the
shop in an extremely busy location. That’s €5 million ayear - or maybe
quarter of that in a rural setting."
However, there are costs associated with reopening some stations. Many
buyers had either removed the station’s underground fuel tanks or
filled them with sand or foam. O’Sullivan said Great Gas was
considering reopening one station which had its tanks filled with
foam. ‘‘It’s very expensive to take the foam out, as it has to be
dissolved," he said. ‘‘When people foamed these tanks, they never
thought it was coming out again."
Petrogas, which was founded in 1992 by Bob Etchingham and Joe Barrett,
launched the Applegreen brand in 2005,and the company now has 52
sites. Its latest acquisition is a former petrol station opposite
the Ballintyre development in Ballinteer in Dublin which closed more
than a year ago and was earmarked for development.
Some stations have reopened as car washes, though not everyone is happy
about that. The Irish Petrol Retail Association (IPRA) has written to
the enforcement sections of planning departments in councils across
Ireland in a campaign against what it claims are unlicensed businesses.
The IPRA said many members were losing business to unregulated
operators that set up without planning permission. ‘‘Our
membership operates car washes under suitable and appropriate grants of
planning permission and licence, while others operate without concern
for local planning laws or waste water disposal," said the letter.
IPRA spokesman David Blevings recognised that, with property prices
plummeting, other developments earmarked for the sites of closed petrol
stations were unlikely to continue. ‘‘Fuel retailing is not a
licence to print money, and the fact remains that fuel margins are
becoming ever tighter. In an industry with high costs and low returns,
this poses a distinct challenge to retailers across the island," he
said.
PetrolWorld 210909
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