10th May (Issue 346)
Welcome to the Origin Capital Weekly Irish Property Review. This update is designed to provide you with a full recap of the latest property news from the media over the last seven days.
RETAIL
St Stephens Green, Dublin 2 Oakmount is closing in on the purchase of UK fashion retailer Topshop’s former flagship premises at 6-7 St Stephen’s Green in Dublin city centre. According to market sources, the sale price is understood to be in line with the €17.25m joint agents Savills and BNP Paribas Real Estate had been guiding when they offered the building to the market on behalf of Irish property company Iput in March. 6-7 St Stephen’s Green has lain largely dormant since the departure of Topshop from its ground, lower-ground and first-floor levels, which together account for 22,271 sq. ft. of retail space. The entire building extends to 26,716 sq. ft., with the second, third and fourth floors (4,434 sq. ft.) given over to self-contained offices. According to market sources, McKillen jnr and Ryan’s Oakmount plan to convert the property into a boutique hotel, which will likely be operated as part of their Press Up Hospitality Group. The Irish Times, 5th May
City Square Shopping Centre, Waterford Marathon Asset Management has secured a buyer for City Square Shopping Centre in Waterford. The buyer is an individual private Irish investor. Located in the centre of Waterford city, City Square Shopping Centre is currently producing €1.54m in annual rental income from a strong tenant line-up including River Island, JD Sports, Peter Mark, GameStop, and Holland & Barrett. The development is laid out over two retail floors, including a two-storey 80,000 sq. ft. department store (formerly occupied by Debenhams) and 34 retail units and kiosks. The scheme has a current average weekly footfall of c. 110,000 and has direct access to a 490-space car park via High Street. According to the Irish Times, the new owner is understood to have paid just over €22m for the centre, or 10% less than the €24.5m agent Colliers had been guiding. The Irish Times, 4th May However, according to an article in the Wexford People, the centre was purchased by Wexford based developers William Neville & Sons for c. €18m. Wexford People, 4th May
Charlestown Shopping Centre, Dublin 11 Garristown Venture Holdings, is seeking a buyer for the Charlestown Shopping Centre in Dublin 11, with Cushman & Wakefield guiding €39.5m. The scheme comprises c. 232,070 sq. ft. of retail space and is anchored by Dunnes Stores, Sports Direct and Boots. Odeon Cinemas and Leisureplex also form part of the scheme along with a strong mix of tenants in the food, medical and supports services sectors. The sale consists of the freehold interest in the entire shopping centre, cinema and leisure block and the car park. The current occupancy rate is c. 98%, with just two vacant retail units and a WAULT of eight years to break option and 10 years to expiry. The total passing rent is expected to approach €4m once the new lettings are delivered. The shopping centre’s guide price reflects a gross yield of 10%. The vendors are also open to a sale of the centre’s owner, Balrath Commercial Property Holdings Limited, as a corporate entity. The Irish Times, 6th May
Nassau Street, Dublin 2 A €150m proposed redevelopment of a building owned by Larry Goodman’s family will not go ahead after a settlement was reached with its tenant. The Setanta Centre, an office block and retail space on Nassau Street in Dublin 2, was embroiled in a legal battle with Clydaville Investments Limited, the company behind the Kilkenny shop, which is a tenant in the building. Clydaville brought High Court proceedings against the Setanta Centre in 2019, after the latter secured planning permission from Dublin City Council to redevelop the building and replace it with a €150m office development. While details of the settlement were confidential, it is understood that the Setanta Centre gave an undertaking that it would not proceed with the proposed redevelopment as envisaged. Setanta is also understood to have told Clydaville that it had no intention to sell the building at the moment. A dispute about an upper floor being used as a restaurant, as opposed to a café, was also resolved. The Business Post, 8th May
OFFICE
Fitzwilliam Street, Dublin 2 Having committed in early 2020 to a long-term lease on all 135,617 sq. ft. at the newly developed Fitzwilliam 28 on Fitzwilliam Street at a rent of €7.7m pa, Slack will now relocate its entire operations to Salesforce’s new European headquarters in the city’s north docklands instead after being acquired by the US tech giant last year. According to market sources, Cushman & Wakefield has been engaged to secure an occupier for Slack’s Fitzwilliam Street offices on the basis of a lease assignment. Fitzwilliam 28 is one of two adjoining, but independent blocks developed by the ESB. The sister block to 28, Fitzwilliam 27, is to be owner-occupied by the utilities provider. The Fitzwilliam 28 scheme is owned by Amundi Real Estate, a specialist subsidiary of Europe’s leading asset manager Amundi. Amundi acquired Fitzwilliam 28 for €180m in November 2020. The Irish Times, 4th May
Lapps Quay, Cork An office investment in Cork city centre is being offered for sale with a €4.95m guide price reflecting a NIY of 7.93%. It comprises five office suites laid out around a central service core extending to 16,862 sq. ft. covering the third floor of City Quarter development on Lapps Quay. Selling agents Lisney point out that it is fully occupied under various leases and its existing tenants include Glandore Business Centre, Goodbody Stockbrokers, NIB Travel Insurance, GJ Moloney Solicitors and Cornmarket Group Finance Services Ltd. The investment currently generates an income of €431k pa with WAULT of 4.75 years. A group of private investors are the vendors. There are 280 basement car spaces which are not included in the sale. The Irish Independent, 5th May
Albert Quay, Cork Serviced office space specialists Iconic are set to become the first tenants at Two Navigation Square (NSQ2). The move by Iconic to the O’Callaghan Properties (OCP) flagship development on Albert Quay is the company’s first foray outside of Dublin. The expansion of their business to Cork will see them take a single floor – 14,000 sq. ft. – which they are currently fitting out, in the six-storey NSQ2. OCP has plans for two more office blocks as part of the €90m Navigation Square development, for which start dates are currently under review. Plans to begin the third block last year were put on hold in a globally challenging environment. The Irish Examiner, 5th May
HOSPITALITY
Temple Bar, Dublin 2 Located in the heart of the city’s Temple Bar area, the Wellington Hotel briefly comprises a newly developed 38-bedroom hotel complemented by extensive bar and restaurant facilities extending to 3,660 sq. ft. The property is being offered to the market by CBRE at a guide price of €18m. While that figure equates to c. €473.7k per key, which is far higher than the €300k per-key average paid across all Dublin hotel sales in 2021, the premium can be accounted for by the relative scarcity of hotel rooms in the Temple Bar district (less than 1,000) and by the ongoing recovery in the tourism sector. Figures released by travel industry analyst STR show that over the 28 days to April 11th, Irish hotel room occupancy levels reached 81.3% of their pre-pandemic number. The Irish Times, 4th May
Leeson Street, Dublin 2 US hospitality company Sonder plans to open its first hotel in Dublin this summer. The property on Leeson Street, which is a 26-key hotel, is currently being renovated ahead of the opening. Sonder, which lists on the Nasdaq with a market cap of c. €780m, lets out serviced apartments for medium-term stays but has now expanded into traditional hotels. The company entered the Irish market in 2019 and has two serviced apartment buildings with 55 units. The Irish Independent, 8th May
MIXED-USE
Belcamp, Dublin 17 A Gerry Gannon company will lodge plans in coming days for the largest SHD fast-track scheme to be put before An Bord Pleanála to date. Gerard Gannon Properties Ltd has given notice that it is to lodge plans for a mixed-use scheme that will include 2,527 residential units for Belcamp Hall, Malahide Road at Belcamp in north Dublin. A statutory planning notice for the latest scheme shows that the proposal is comprised of 1,780 apartments, 473 houses and 274 duplex units. The company is seeking a 10-year planning permission to complete the ambitious project. The notice states that 1,969 units are residential with 558 apartments to be BTR. It will also include 18 retail units, three cafes/restaurants, two childcare facilities and one sports building. The plans to be lodged in the coming days also provide for 2,225 parking spaces and 5,394 bicycle spaces. The Gannon firm is to lodge an Environmental Impact Statement (EIS) with the scheme. The board is due to make a decision on the Gannon scheme 16 weeks after receiving the detailed plans. The Irish Times, 4th May
Donnybrook, Dublin 4 Dublin City Council has cleared the way for Cairn Homes to lodge a planning application for 690 apartments and a hotel on a site it purchased from RTÉ in Donnybrook, Dublin 4. The council told Cairn Homes in an “opinion” that its mixed-use plan constitutes a reasonable basis for a “Large Residential Development” application under new planning rules for large-scale housing developments. Cairn Homes now has six months to lodge a formal planning application for the scheme with the council. The development envisaged would include 274 build-to-sell apartments and 416 build-to-rent apartments. It would also include a hotel, 17 “age friendly living” units, a creche facility, restaurant and cafe, artisan food shop, residential amenities and associated site works. The plan by Cairn comes five years after it paid RTE €107.5m for the 8.64-acre site. The new LRD system replaces the fast-track SHD system which allowed developers to bypass councils and lodge their plans directly with An Bord Pleanála. The Irish Times, 5th May
RESIDENTIAL / DEVELOPMENT
Camden Street, Dublin 2 Located immediately to the west of Camden Street, 12 Camden Row (a 0.3-acre site) is being offered to the market by Savills at a guide price of €9.5m. The subject site is home currently to a 18,299 sq. ft. building, which is occupied under a series of licence agreements. Taken together, these delivered a gross operating income of €704.1k in 2021 based on a current occupancy rate of 66%. The development potential of the site is framed by the Dublin City Development Plan 2016-2022. The property is located in an area zoned objective Z4: “To provide for and improve mixed-services facilities. Permissible uses include, but are not limited to, the development of an office, residential or hotel scheme.” The Irish Times, 4th May
Clondalkin, Dublin 22 Agent CBRE is guiding a price of €2.95m for a 1.98-acre site with scope for commercial or retail development (subject to planning permission) in Clondalkin, Dublin 22. Situated just off the Old Nangor Road and 2km west of Clondalkin village, the subject site has significant potential thanks to its proximity to Kilcarbery Grange, a 1,034-unit residential scheme being delivered by South Dublin County Council in partnership with Maplewood Residential & Grandbrind Ltd, and to the Clonburris SDZ where 9,000 new homes are set to cater for a population of 23,000. While the lands are zoned ‘RES-N’ in both plans, the vendor is, however, seeking proposals for a commercial-led scheme only, on a subject to planning basis. The Irish Times, 4th May
Dalkey, South Dublin Developers involved in the delivery of accommodation aimed towards the upper end of Dublin’s PRS and owner-occupier market will be interested in the sale of 1 Knocknacree Road in Dalkey. The property is being offered to the market by Robert Colleran Property Consultants at a guide price of €2m. The subject property occupies a site of 0.2 acres and is zoned as ‘Objective A – Residential’. The existing house is a large two-storey structure of 2,000 sq. ft. The Irish Times, 4th May
Drumcondra, Dublin 9 Dublin City Council has refused planning permission for a contentious 74-unit BTR scheme in Drumcondra in Dublin. The eight-storey scheme for Turnpike Lane at the rear of 59-69 Drumcondra Road Lower in Dublin 9 attracted local objections, while An Taisce also opposed it. The Irish Times, 5th May
Rathcoole, Co Dublin Plans for 98 residential units at Rathmill Manor, Rathcoole, Co Dublin have secured permission from An Bord Pleanála. Cavan Developments has won an appeal for the scheme which adjoins their existing housing development at Rathmill and Broadfield despite refusal by South Dublin County Council in June 2021 to grant permission to the development. The scheme comprises 51 houses (23 three-bed two-storey, 28 four-bed two storey), 37 apartments and 10 duplexes. The apartments and duplexes will be provided across four blocks ranging in height from three to four storeys. There is also a provision for 154 surface level ancillary car parking spaces and bicycle parking. An Bord Pleanála
Cabinteely, Dublin 18 McGrath Group Properties has sold two phases of its Elmwood apartment development at Johnstown Road in Cabinteely, Dublin 18, to Clúid Housing, the independent not-for-profit charity which provides affordable homes to people in housing need. According to market sources, the sale price is c. €45m for both phases. At the early stages of the first phase of the development, it was indicated that McGrath had received offers of more than €20m from investors in advance of its work. The first phase at Johnstown Place consists of 51 units – 26 one-bed apartments and 25 two-bed apartments. Phase two of Elmwood comprised 25 one-bedroom units and 32 two-bedroom apartments which have just been completed. The Irish Independent, 5th May
Liberties, Dublin 8 A major residential development in Dublin’s Liberties area has been prepared for a €205m sale by owner Bain Capital. CBRE has been instructed to sell Newmarket Yards, a 413-apartment multifamily development. The guide price reflects a NIY of just below 4%. Construction work commenced last summer and the project is due for completion in the first quarter of 2023. It includes 203 studios, 136 one-bedroom apartments, 72 two-bedroom units and two three-bedroom properties. The site will also house a 151-bedroom hotel that Premier Inn has been lined up to operate. Bain Capital is seeking to fund the hotel element in a separate process. The prospect of a further constriction of the development pipeline may put downward pressure on stablised and under construction assets. Prime yields for stabilised residential assets sit c. 3.6%, while the current benchmark for the very best forward commit opportunities is 3.75%. React News, 3rd May
Kilcock, Co Kildare Coonan Property in Co Kildare is handling the private treaty sale of a 2.3-acre site in the middle of the town of Kilcock with planning permission for 67, mostly residential, units. The agent is guiding €2.7m for the site. The lot rests on Church Street and was the home of the former Corscadden’s Hotel. There is planning permission for 67 units, of which 64 are to be dwellings. The remaining three are being held for commercial units, one of which is to be a café. The Business Post, 8th May
OTHER
Balmoral International Land, the property company spun out of tropical fruits group Fyffes in 2006 and controlled by the wealthy McCann family, has secured a 16% discount settling c. €57m of debt owed to US investment firm Cerberus, following a legal stand-off. The terms of the settlement, agreed in March, are contained in Balmoral’s annual report for 2021, published on its website in recent weeks. It ended a legal dispute that began in late 2020. The annual report said that Balmoral has paid €48m, inclusive of various costs, to settle the debt owed to Everyday Finance, a debt servicing firm used by Cerberus to manage the loans on a day-to-day basis. That equates to c. 84% of the total of c. €57m that was owed, including £20.2m of sterling-denominated loans. The settlement was funded from cash and the equivalent of €43.9m of new facilities from Bank of Ireland, which are secured over certain group assets and due to be mature in three years. The Cerberus liabilities were what remained of an original €300m facility Balmoral agreed with AIB in 2007 and which was acquired by Cerberus in January 2020 as part of a broader loan portfolio transaction. The Irish Times, 10th May
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