14th January (Issue 479)

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.

 

HOSPITALITY

Dalkey, Co. Dublin The board of the group of investors who own the famous Queens pub in the coastal village of Dalkey have voted to close the business ahead of its sale. The pub was put on the market for €3.95m last year after it secured planning permission to add a 30-bedroom guesthouse at the back of the venue. The Queens pub was bought by its current owners for €3.5m in 2021 from its previous owners, who paid an estimated €7m for it in 2003. The Currency, 9th January

Tourism Sector Government contracted beds for asylum seekers and refugees has fallen by 15% since last May, according to new figures from Fáilte Ireland. As of last November, there were 65,457 beds under contract which, despite the reduction, is estimated to cost the tourism sector between €400m and €670m in lost revenue. Of contracted beds, 27% (17,632) are now in hospitality accommodation officially registered with Fáilte Ireland. The remaining 73% of facilities are not registered, although approx. half are in facilities considered likely to have been trading within the tourism economy. The Irish Times, 10th January

Dublin City A six-storey building at One Westmoreland Street, that has full planning permission for a 38-bedroom hotel, has been sold by CBRE Ireland to a private buyer. The original guide price was €6m. The property, which has been on the market since 2022, is situated on one of the widest and busiest streets in Dublin city centre and is situated opposite the five-star College Green Hotel. Fexco currently operates a currency exchange at ground floor level in the building. The Irish Times, 13th January

 

OFFICE

Plassey Innovation Campus, Limerick Fine Grain Property has completed the off-market sale of Hamilton House II for €14m, reflecting a Net Initial Yield of 7.75%. Acquired in 2018, Hamilton House II was fully let at the time of acquisition and has since been transformed through strategic asset management, including re-letting the entire property to H&MV Engineering under a long-term FRI lease. Targeted enhancements and capital investments have upgraded the building to institutional standards, making it an attractive asset for buyers like the investment fund managed by Inter Gestion REIM. Fine Grain Property Press Release, 9th January

CBRE Report Dublin office take-up totalled close to 550,000 sq. ft in Q4, bringing full year take-up to just over 2.26m sq. ft, 12.5% below the 10-year annual average. Annual take-up rose 66% year on year (“YoY”) from 2023, signifying the renewed occupier confidence in the market, particularly for well-located sustainable stock. The largest leasing deal of the year was signed in Q4 by Deloitte at 1 Adelaide Road, a pre-let of approx. 155,000 sq. ft of space. The Dublin office vacancy rate is now 18.6% but given the lower level of construction completions forecast for 2025 and the uptick in leasing activity, vacancy appears to have peaked and will likely decline through 2025. Annual office investment rose 32% in 2024 to €510m (21% of all Irish investment). The largest office investment transaction of the year was the sale of One & Two North Dock for approx. €85m to Starwood Capital Group. CBRE Press Release, 14th January

 

RETAIL

Marks & Spencer Group said the economic outlook is uncertain after comparable sales for the retailer in the UK and Ireland rose 6.4% in the 13 weeks to December 28th. M&S has invested in larger food stores and a more extensive range of items, helping it gain a bigger share of household spending on groceries. The chain’s clothing division — for many years pilloried for being unfashionable — has also shown continued uplift in demand with comparable sales climbing 1.9% in Q3. The Irish Times, 9th January

Shaws Pre-tax profits at department chain Shaw & Sons declined by 68.5% to €787k as Revenue increased by 2% from €68.8m to €70.5m for year-end January 2024. Numbers employed increased from 686 to 702 as staff costs increased from €17.5m to €18.37m. In the year under review, the company paid a dividend of €225k. The principal activity of the company is the operation of 16 department stores throughout Ireland, though it also operates several investment properties which generates rental income. The Irish Independent, 9th January

 

RESIDENTIAL/DEVELOPMENT

Tallaght, Co Dublin Housing association Clúid purchased Airton Plaza, a 328-unit residential development of approx. 270,000 sq. ft, from property investment group ESR Europe for approx. €160m, which it is putting on the market for social housing as well as its biggest cost rental scheme to date. The scheme was developed by Mableground, while Glenbrier Construction was the main contractor. Rent for the 75 one-bed cost rental apartments is €1,400 pm, which represents a saving of 26% on the market rent for a similar apartment in the area. For the 148 two-bed cost rental apartments, rent is €1,715 each pm, a 27% discount on market rents. The seven three-bed cost rental apartments at €1,800 pm offer the greatest discount on market rents, representing a saving of 34%. The Irish Times, 10th January

Dundrum An Bord Pleanála (ABP) refused planning permission for the construction of 881 apartments on the site of a former shopping centre in Dundrum village. Dundrum Retail GP DAC, which is co-owned by Hammerson and Allianz Real Estate, sought an eight-year permission to demolish the existing buildings, and construct apartments, a crèche and a food store. However, ABP stated that the proposed 11 block development “would seriously detract from the architectural character of the area”, particularly against the local conservation area, the Holy Cross Church, and the associated Parochial House. As 95% of the proposed development would be of a residential nature, ABP determined it would be inconsistent with the plan’s aims. The planning application, which was submitted on April 5th, 2022, also included plans for a 60,008 sq. ft communal open space, as well as a 70,913 sq. ft public open space. The Business Post, 7th January.

Wicklow Town Planning permission has been lodged to develop a new 116 room hotel and 107 residential units at the Murrough. The site of the old Veha factory went up for sale in 2022 after the radiator plant closed in 2005 with the loss of 93 jobs. The site has also been designated as part of the Murrough Opportunity Area, a mixed-use urban area extending from the northern boundary to as far as Urban Villas and the village park to the south. East Coast.fm, 9th January

Cork City Apartment Building at Kennedy Quay is due to get underway as part of a €350m docklands transformation plan by O’Callaghan Properties (OCP). While the developer had hoped to begin construction work on the 4.1-acre site in the middle of last year, the timeline has been pushed out. OCP previously partnered with Clúid Housing to deliver 88 apartments at Cork city’s first cost-rental scheme at Lancaster Gate on Lancaster Quay, while directly across the river from Kennedy Quay, the LDA is partnering with BAM/Clarendon Properties at Horgan’s Quay in the construction of a 302-unit apartment scheme. The Irish Examiner, 9th January

Inchicore, Dublin 8 Autofill, an ecommerce fulfilment company, has spoken with the LDA over a site that has the potential for a 167-apartment project in Inchicore. The 1.2-acre industrial property in question is located to the rear of a strategic site earmarked for affordable housing. Under the “City Edge Project,” the LDA has plans to redevelop 69-acres of land owned by Iarnród Eireann, alongside sites belonging to the ESB and the Office of Public Works. The development, which was announced in 2021, is set to make 5,000 affordable homes available to buyers under the government’s ‘Housing for All’ policy. It planned to build a further 5,000 homes on nearby surrounding sites. The Business Post, 13th January

Mortgages The average mortgage loan for a house purchase exceeded €300k for the first time last year, according to the latest quarterly report by property website MyHome.ie. The average residential mortgage loan was approx. €308k in the third quarter, up 7% YoY. In October the average mortgage approval rose to a fresh high of €321k, up 8% YoY, the report noted. In the fourth quarter the median asking price for properties listed on MyHome was €365k, up 8.4% YoY. In Dublin, the figure was €450k, up 5.9% YoY. Irish Times, 9th January

Glenveagh Results Homebuilder Glenveagh Properties said it had completed and sold a total of 2,415 homes in 2024, an increase of 77% on the previous year’s total of 1,363. In a statement, Glenveagh said its revenue rose by 43% to €869m from €608m, while its profit before tax jumped by 106% to €113m from €55m in 2023. The builder said its group forward order book is worth €950m, an increase of 48% on 2023. It added that planning permission has been granted for 2,487 units ensuring that all targeted output for 2025 is fully approved. Rte.ie, 10th January

Cairn Results An increase in the number of affordable homes Cairn produced for State partners led to a decline in average price from €389k in 2023 to €383k last year. However, output rose 29% over the year to 2,243 units. Commencements also ramped up during 2024, with more than 4,100 new homes started, including 19 large-scale developments, compared to 2,162 commencements in the prior year. Revenue was approx. €860m for the 12-month period, up 29% YoY. Operating profit was 32% higher at €160m, beating guidance of €145m. The Irish Times, 14th January 2025

 

OTHER

Data Centre operator Equinix has given €33m to landowners as it continues to invest in Ireland despite grid lockouts. The US company operates 260 data centres across more than 30 countries and has assets valued at $108bn. In Ireland it has four co-location data centres and operates two hyperscale data centres around Dublin city. It recently signed a deal with telecommunications company BT to acquire two of these co-location facilities for €59m in a deal that is set to close Q1 of this year. The company has been buying land which was previously leased to Equinix on long-term contracts. The company has paid €20m to Bartra Capital that owned the land BT built its two data centres on. In April 2024, the company purchased land worth €7m that it had leased from a landlord in Kilcarbery, near Profile Park in Clondalkin. The company also paid €6m for a site in Blanchardstown which is adjacent to its current data centres. The Business Post, 8th January

Investment Market Real Estate Investment in Ireland reached €2.4bn in 2024, with retail the standout performer. JLL unveiled new research which found that while the total investment volume last year was up 30% from 2023, the figure is still 42.7% below the ten-year annual average. Retail accounted for approx. half of the market, with €1bn invested across 31 deals. This marks a 142% increase on 2023 and is 43% above the ten-year average. Office was the second largest sector, with investment totalling €508m across 37 deals, 62.3% below the ten-year annual average. The private rental sector was the third largest sector for investment, with €461m invested in 2024. This represents a marginal 6.1% increase YoY but remains 55.3% below the ten-year annual average. The Business Post, 8th January

BNP Paribas Ireland Construction PMI Report The headline seasonally adjusted BNP Index moved back above the 50.0 no-change mark during December, rising to 51.6 from 47.5 in November. The reading signalled an expansion in total activity that was the first for eight months. The increase in total construction activity reflected growth in two of the three monitored categories. Housing continued to lead the way, posting a fourth consecutive monthly expansion. Commercial activity returned to growth for the first time in four months. Meanwhile, civil engineering activity continued to fall. New business increased for the ninth time in the past ten months. BNP Paribas, 13th January

 

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