13th June (Issue 100)
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.
LOAN / PORTFOLIO SALES
AIB Loan Sale: The Sunday Business Post reports that AIB is considering a loan sale which would consist of its 35 largest borrowers whose facilities are in arrears. The paper reports that the loans are secured by property development, SME and operating assets. The reporting of this potential loan sale comes at a time when the bank is exploring its options for reducing the size of its non-performing loan book of c. €8.6bn. The Sunday Business Post, 11th June
RETAIL
Blackpool Shopping Centre: Bids in excess of €117m are being sought by joint agents JLL and HWBC for Blackpool Shopping Centre in Cork, along with the adjoining retail complex and self-contained offices. The complex produces a net operating income of c. €7.38m p.a., offering the new owners an initial yield of more than 6%. Extending to 300,000 sq. ft. of retail and retail park space, c. 109,000 sq. ft. of offices and c. 1,800 car parking spaces, the Blackpool complex also contains a number of community services including a council library, post office and health board, and has a catchment area of over 400,000 people. The occupiers include a variety of high profile retailers including Dunnes Stores, Aldi, Next, Carphone Warehouse and Boyle Sports. The retail centre is currently owned by Varde Partners, who purchased the centre as part of the c. €170m Project Acorn portfolio nearly three years ago. The Irish Times, 7th June
Florentine Centre Site: A public sale process has commenced to find a developer to build a new €25m retail hub on a site formerly owned by Ballymore Properties in Bray, Co. Wicklow. Wicklow County Council has launched a pre-qualification process for bidders who are seeking to purchase the proposed Florentine Centre site, which has been in a derelict condition for a decade. The sale offer has strict conditions regarding what must be developed on the site, including two anchor stores, eight retail units, a five-screen multiplex cinema, three restaurants, business units, 250 car-parking spaces and 320 cycle spaces. The Council will shortlist three bidders after the initial pre-qualification process, while the second stage of the competition will assess the financial offer and how quickly the development can be completed and open for business. It is hoped that the retail centre will be open within the next two years. The Irish Independent, 11th June
Polonez Food Stores Building: An unnamed investor has paid slightly less than €2.9m to purchase the Polonez Food Stores Building at 49/50 Mary Street in Dublin 1. The three-storey, over-basement mixed-use building extends to 10,000 sq. ft., with 4,100 sq. ft. of the ground floor let to Polonez. The freehold building produces a rental income of c. €82k p.a., and has a number of outstanding rent reviews. The Irish Times, 6th June
OFFICE
Adelaide Chambers: Colliers International is guiding €8m for the Adelaide Chambers office scheme on Peter Street in Dublin city centre. The complex comprises a landmark four-storey over-basement period office building, with a modern, four-storey extension. With a net internal area of 17,670 sq. ft. and 31 car parking spaces, the scheme’s configuration allows for a corporate HQ, while the suites could be used for start-up companies seeking a city centre location. The building currently produces a rent roll of €293k p.a. from tenants including the HSE and SEBELA pharmaceuticals. This equates to €17.31 psf, which the agents advise is substantially lower than average market rents in the area. The Irish Independent, 9th June
Georgian Office Market: The Sunday Times reports on the continued recovery in the Georgian office market in Dublin city centre. According to Mark McCormack of GVA Donal O’Buachalla, prime rents for office space on the main southside squares can now command between €40 and €45 psf. Approximately 18 months ago, the market rent was c. €30 to €35 psf. Brian Gaffney of Murphy Mulhall also reports on the sales market for Georgian assets, mentioning that prime Georgian properties in Fitzwilliam Square and Merrion Square can sell for up to €502 psf. The Sunday Times, 11th June
St George’s Church: Joint agents Arthur Ryan Property Consultants and Cushman & Wakefield are inviting offers of €2.9m for the newly restored St George’s Church on Temple Street in Dublin’s north inner city. The former church has been significantly refurbished and converted into a high-class office facility, and is currently rented by the adjoining Temple Street Children’s University Hospital on a 10-year lease from 2015 at a rent of €225k p.a. Additional income comes from two licence arrangements and €35k in annual fees from Vodafone and Meteor, who both have communications equipment located on the roof of the building. The premises extends to 22,000 sq. ft. and the guide price will offer the new owner an initial yield of c. 8.6%. The Irish Times, 7th June
HOTEL
Metropole Hotel: Planning permission is to be sought within days by Trigon Hotels for a c. €50m extension and refurbishment of The Metropole, one of the oldest hotels in Cork. The plans, which will likely take three to five years to complete, will involve the extension and refurbishment of the existing 112-bedroom hotel, the construction of a new adjoining hotel, to be named the ‘M’, and the provision of a retail arcade. Trigon Hotels is associated with Philip Hotel Holdings Ltd, who bought the Metropole Hotel in 2015 for €5m, and subsequently purchased a 0.36 acre site across Harley Street for c. €1.35m. The plans propose the development of what will be Cork’s largest hotel complex in two associated buildings, offering 400 rooms and connected by a glass bridge link above Harley Street. The Irish Examiner, 8th June
Chancery Street Hotel Application: Melonmount Ltd has sought planning permission from Dublin City Council to construct a new 249-bedroom hotel on Chancery Street, near the Four Courts in Dublin city centre. The application seeks permission to demolish the existing six-storey building on the site, and replace it with an eight-story hotel extending to 100,000 sq. ft. Melonmount is controlled by Mawash, Sonia and Jalaluddin Kajani. NAMA Wine Lake, 11th June 2016
Amiens Street Hotel Application: Railtours Ireland First Class Ltd has applied for permission to demolish an existing two-storey property on Amiens Street in Dublin city centre and replace it with a new four-storey over basement hotel with 11 bedrooms. Railtours is controlled by James Deegan and Fiona Ballance. NAMA Wine Lake, 11th June
RESIDENTIAL / LAND
Dublin Living Development: Marlet Property Group, owned by property developer Pat Crean and M&G Investments, is to seek in excess of €425m to forward fund the development of 1,170 apartments in four separate locations in the Dublin suburbs. The four schemes are located at Mount Argus and St Clare’s in Harold’s Cross, Dublin 6w, Carriglea in Bluebell, Dublin 12, and Cabra Road in Dublin 7. Savills estimates that based on current rental values in similar schemes in the Dublin suburbs, the equivalent net rental income from the ‘Dublin Living’ developments would be c. €20.5m p.a., allowing for running costs. However, it is believed that the estimated rental figure will increase significantly during the construction period because of the undersupply of private rented accommodation in Dublin. The four high quality schemes are scheduled to be completed between H2 2018 and the early part of 2020, and will consist predominantly of two-bed units (750 in all) along with 255 one-beds and 165 three-beds. The Irish Times, 7th June
RTE Donnybrook Site: The Irish Times reports that the bidding for RTE’s 8.64-acre Montrose site in Donnybrook, Dublin 4 is approaching €90m, with Cairn Homes believed to be the front runner. Michael O’Flynn, Bartra Capital, Chartered Land and Bridgedale are also believed to have lodged bids for the site. The site has been on the market through Savills, who had given the site a guide price of €75m. It is believed that the successful bidder will be chosen this week, possibly after a RTE board meeting on Thursday. The Irish Times, 13th June
Foxrock Residential Site: CBRE is guiding over €5m for a 1.1-acre residential development site on the Stillorgan Road in Foxrock in Dublin 18. The site comes with full planning permission for the demolition of the existing dwelling and the construction of 24 new properties. The proposed scheme contains a mixture of apartments ranging in size from 785 sq. ft. to 1,540 sq. ft., and houses ranging in size from 1,981 sq. ft. to 2,099 sq. ft. The Irish Independent, 12th June
Dublin City Apartments: A private investor has paid c. €4.6m (c. €600k over guide) to purchase a block of 25 apartments located between Christchurch Cathedral and the Guinness Storehouse in Dublin city centre. The complex consists of 10 two-bedroom apartments and 15 one-bedroom units in Hanbury Mews at Hanbury Lane, which when fully let produce a combined rent roll of c. €345k p.a. The apartments were developed by Liam Carroll in 2008. The Irish Times, 6th June
Parkhouse: QRE has completed the sale of seven two-bed apartments in the Parkhouse development on Benson Street, Dublin 2 for c. €2.24m, c. €140k over the guide price. The sale was completed using the BIDX1 online property transaction platform. The Irish Times, 6th June
Bank of Ireland (BoI) Mortgage Rates: BoI has announced rate cuts of up to 0.35% on their fixed rate mortgage products. The rate cuts, which ranged from 0.10% to 0.35%, commenced on June 6th. The best rate the bank offers for a two or three year fixed rate mortgage is now 3%, however the borrower must have an LTV of 80% or less. The Irish Times, 13th June
Bluebell Apartments Application: Arcourt Ltd has applied to Dublin City Council to build three three-to-six storey residential blocks on a one-acre site on the Old Naas Road in Bluebell, south west Dublin. The buildings will contain a total of 85 new apartments, split between 18 one-beds, 55 two-beds and 12 three-beds. The new application supersedes a 2014 application to build a 44-unit aparthotel on the site. Arcourt is controlled by Jackie Cosgrave. NAMA Wine Lake, 12th June
Cork Street Application: Como Properties Ltd has applied to Dublin City Council for permission to replace the Hanlon Food Services factory on Cork Street in Dublin city centre with a mixed-use development consisting of residential and retail space. The development will accommodate 39 apartments, split between eight one-beds, 25 two-beds and six three-beds, alongside 2,500 sq. ft. of ground floor retail and office space. The application supersedes a 2015 application for a similar development with 42 apartments. Como is controlled by Eamonn and Marie McCann. NAMA Wine Lake, 11th June
Residential Property Prices: According to the latest property price index from the Central Statistics Office (CSO), residential property prices increased by 10.5% nationally and by 8.2% in Dublin for the year ending April 2017. Excluding Dublin, residential property prices rose by 13.4% in the same period. For the month of April 2017, national prices rose by 1.1%, while Dublin prices rose by 0.2%. Overall, national prices remain 30.7% below their 2007 peak, while Dublin prices are 31.3% below their February 2007 peak. CSO Residential Property Price Index April 2017
INDUSTRIAL
Stadium Business Park: JLL is inviting offers above €8m for a modern logistics building in the Stadium Business Park in Ballycoolin, Dublin 11. The c. 79,000 sq. ft. building is let to Viking Direct on a 20-year lease from 2007, with a break option in 2020. The company pays a rent of €744k p.a., offering the new owners a return in excess of 8.8%. The Irish Times, 6th June
15 Barrow Street: Property developer Chris Jones has purchased 15 Barrow Street in Dublin’s south docklands through Jones Investments. The property is a low-rise industrial warehouse near Google’s international HQ that was on the market for c. €2m in 2016. Jones plans to demolish the building and replace it with an enterprise centre with ‘collaborative workspace’, a café, landscaped courtyard and a roof terrace. The new four-storey building will include a double basement and will extend to over 40,000 sq. ft., more than double the size of the existing building on the site. The Sunday Times, 11th June
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