14th March (Issue 388)
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
Blackrock, Co Dublin Irish homeware retailer Homestore and More is to open for business at the Frascati Centre in Blackrock in May. The new outlet, the company’s 24th in Ireland, will be located in the basement level of the former Debenhams unit. The store will be the retailer’s first shopping centre presence as it traditionally trades in retail park locations. The former Debenhams store, located on the ground and lower ground floor of the Frascati Centre, has been vacant since the UK-headquartered chain went into liquidation back in 2020. Apart from the arrival of Homestore and More, the Frascati Centre has recently secured agreements with several new and existing tenants including Musashi Sushi, GNC, Tresspass, Pamela Scott and Shields Dental. The Irish Times, 8th March
Henry Street and Swords, Dublin Sports footwear and apparel retailer, Foot Locker, is to open two new stores later this year at the Ilac Shopping Centre in Dublin city centre and at the Pavilions Shopping Centre in Swords. In the first instance, Foot Locker Unit has agreed a deal with CBRE to occupy units one and two at the Ilac Centre. Extending across a total area of 12,744 sq. ft, the company’s new retail space is located on the ground floor and first floor and has frontage on to Henry Street. It is understood that Foot Locker agreed a long-term lease on the premises. The letting to Foot Locker brings the total number of retailers operating within the Ilac to 73 and brings the scheme to full occupancy. In the case of the Pavilions Shopping Centre, Foot Locker has agreed a long-term lease with CBRE for unit G19 at the scheme. The new store comprises a floor area of 4,149 sq. ft on the centre’s ground floor and 653 sq. ft at mezzanine level. Foot Locker is expected to relocate from the centre’s first floor to ground floor during the current quarter. The Irish Times, 8th March
Crumlin, Dublin 12 Dunnes Stores is preparing to knock down the 1970s-built Crumlin shopping centre in Dublin and replace it with a larger, two-storey mall. The move could mean that Ireland’s biggest retailer avoids a derelict sites levy. The shopping centre, which once had 49 shops, a bank and a pub, has been hollowed out over the past 15 years. Dunnes occupies one unit, while the rest of the centre, which is located beside Sundrive garda station, is closed off to the public. In a planning application, Better Value Unlimited, which is owned by Dunnes, is seeking to demolish the 125,000 sq. ft building and replace it with a 182,000 sq. ft shopping centre. A new anchor retail unit will sit at ground and first-floor level. There will be a “food market” on the ground floor, and a food court. Four independent retailers, an 11,000 sq. ft library and a gym are also planned. The Sunday Times, 12th March
HOSPITALITY
Drogheda, Co Louth Gleann Hospitality is selling the D Hotel, the only four-star hotel in Drogheda, Co Louth. Accommodating 111-bedrooms, the hotel enjoys a high-profile location overlooking the Boyne. CBRE are guiding €10m for the hospitality venue. Since buying it in 2017, Gleann has invested more than €1.5m in refurbishing the property which was originally developed by Irish developer Gerry Barrett in 2007. Gleann purchased the hotel from Edward Holdings, Gerry Barrett’s property company, in 2017 for an undisclosed sum. At the time, a spokesman said the hotel “is already trading at a high level and generating strong international and domestic business”. The Irish Independent, 9th March
OFFICE
Blanchardstown, Dublin 15 PayPal has instructed CBRE to find a buyer for its main office campus in Blanchardstown, Dublin 15. The Campus at Ballycoolin Business Park is being offered to market at a guide price of €26m. The subject property extends across a total area of 20.7 acres, and consists of four separate buildings extending to 170,854 sq. ft. The Campus is split into two distinctive sites. The larger site area to the west of the main Ballycoolin estate road extends to 14.1 acres, and consists of three interlinked office buildings covering a combined area of 142,606 sq. ft. The smaller site area to the east of the main estate road, meanwhile, extends to 6.6 acres and consists of a former commercial building (28,248 sq. ft) which has been converted to a high-quality office. React News, 8th March
Lower Abbey Street, Dublin 1 Irish Life is to redevelop the main office block at its Dublin city centre headquarter campus on Lower Abbey Street. The redevelopment, which has full planning permission, will add a total of 59,600 sq. ft to the existing building, bringing it to a total area of 209,200 sq. ft. The development will see the construction of a new 10th floor. Construction is scheduled to get under way in May and the building is expected to be ready for occupation in 2026. The Irish Times, 10th March
Dundrum, Dublin 14 The fourth floor at Rockfield South in Dundrum is available to let immediately by way of flexible lease and comprises 4,500 sq. ft of fully fitted plug-and-play office space. CBRE is quoting rent of €30 per sq. ft – or less than half the prevailing rate being sought within Dublin’s CBD. The Irish Times, 8th March
Harcourt Street, Dublin 2 Savills is quoting a rent of €42.50 per sq. ft for the offices at no. 9 Harcourt Street in Dublin city centre. The subject property briefly comprises a four-storey over-basement Georgian town house extending across a total area of 5,121 sq. ft. There is a large, secure yard to the rear of the property with sufficient space for up to eight cars. This yard is accessible from Montague Lane. The Irish Times, 8th March
Richmond Street South, Dublin 2 Dublin City Council has refused planning permission for a five-storey office block scheme over concerns the proposal would have on a protected structure, Portobello House, overlooking Dublin’s Grand Canal. Portodev Ltd lodged plans in January for the five-storey over lower ground level scheme including a cafe at ground floor level at Richmond Street South, Dublin 2. The scheme involves the demolition of 12, 34-35, 36 and 37 Richmond Street. The Irish Times, 13th March
MIXED-USE
Ringsend, Dublin 4 Owen Reilly is offering a site for sale at 22a, 24a and 24 South Lotts Road/101 Gordon Street in Ringsend in Dublin 4 guiding €900k. The site offers the potential for redevelopment or for immediate commercial/retail and accommodation income. It also comes with six car spaces and full planning permission to convert the building into a café/restaurant, house and apartment. The building is on the corner of South Lotts Road and Gordon Street in Dublin 4 close to Ballsbridge, Beggar’s Bush, Google HQ and Grand Canal Dock. The entire corner will be sold with vacant possession. The Business Post, 11th March
INDUSTRIAL
Cootehill, Co Cavan Abbott, the US healthcare and life sciences company, has said it is reviewing its options after the High Court quashed its planning application last week for a €10m expansion of its infant formula manufacturing facility in Cootehill on the Cavan-Monaghan border. An Bord Pleanála decided to concede the case after judicial review proceedings were brought against the proposed expansion. The Business Post, 12th March
RESIDENTIAL / DEVELOPMENT
Blackrock, South Dublin Abrdn’s Pan European Residential Property Fund (aPER) has completed the purchase of Roselawn, a multi-family/BTR scheme in Dublin, for €70m. The development is the first BTR asset purchased by the fund in Dublin and was acquired on a forward commitment basis, purchased from Richmond Homes. Roselawn is a development of 142 units located in the South Dublin suburb of Blackrock, providing a mix of one, two and three-bedroom apartments. The Business Post, 11th March
Social Housing Darragh O’Brien, the Minister for Housing, is to issue a directive to local authorities telling them to start buying up 1,500 homes for people at risk of eviction. The government is under pressure to help up to 3,000 people who are facing eviction notices when the current winter eviction ban expires in three weeks’ time. Councils have already been given the power to buy up homes when tenants on social housing supports, such as the Housing Assistance Payment, are told that their landlord wants to sell. Last year, 600 homes were bought by councils under this “tenant in situ” scheme but the cabinet has allocated funding for 1,500 more purchases of this type this year. The Business Post, 9th March
Housing Commencements The number of housing commencements in recent months is “flatlining” around an annualised figure in the mid 20,000’s, according to a new analysis from Goodbody. The report estimates that a total of 2,046 units were started in February, taking the total commenced in the past three months to c. 6,000. This is the same level of commencements as one year ago and takes the total over the past twelve months to 27,000, according to the report. The commencement figures are down 23% from a recent peak. Issues around planning are threatening the future pipeline of housing developments, according to the analysis. The number of residential units granted planning permission fell by 44% YoY in the final three months of 2022, according to new CSO data. This followed a “sharp” fall in quarter three 2022 also, leading to the lowest second half performance since 2017, according to the Goodbody analysis. The decline was led by a 54% reduction in apartment permissions. However, the number of permissions for houses fell by 28%, with multi-unit developments down 25% and one-off permissions down by 33%. The Business Post, 13th March
Housing Estates Guidelines Developers are redrawing plans for housing projects due to new government rules that could allow them to double the number of own-door houses they can build. The move is expected to further delay tens of thousands of homes that have full planning permission and are not impacted by legal challenges, which will put pressure on government housing targets in the coming years. Property Industry Ireland, the lobby group, has said that new design rules for housing estates being drafted by government mean a “portion” of 70,000 homes will need to be “replanned for reasons of viability and changing policy”. According to market sources, as many as half of the 70,000 homes will likely go back to the drawing board. In the coming weeks, the Department of Housing will publish new guidelines for housing estates, which are expected to drastically increase the number of own-door homes that can be built on sites by cutting required garden sizes. The Business Post, 12th March
Cost-Rental Housing Households earning well in excess of €100k a year will be eligible for cost-rental schemes under reforms being considered as the Government scrambles to address the rental crisis. With new figures released by the RTB showing 4,741 notices of termination were served in the third quarter last year, the Coalition is considering raising income limits for cost rental, alongside other measures announced earlier this week when it decided to end the eviction ban at the end of this month. Cost rental is aimed at people who earn above the limits for social housing but struggle to pay market rents. Current limits exclude households with an after-tax income of more than €53k annually. Minister for Housing Darragh O’Brien is expected to create a second category, where households can have an after-tax income of €75k-€80k – equating to a pre-tax income well above €100k. The Irish Times, 11th March
Cost-Rental Homes, Dublin Huge numbers of renters are expected to apply for the first Dublin cost-rental homes available under the LDA Project Tosaigh scheme, with rents c. 60% below market rates. Applications for the houses at Parklands, Citywest, will open three weeks before the ban on no-fault evictions comes to an end. The second tranche of LDA cost-rental homes in Delgany, Co Wicklow, will also open for applications. Rents in Citywest start at €1.35k a month for a three-bed house, €1.45k for a four-bed, two-storey house, and €1.46k for a four-bed, three-storey house – all typically c. 57% below market rents, according to the agency. At Archers Wood in Delgany, rent for a two-bed duplex has been set at €1.455k a month and €1.55k for a three-bed. These rents are c. 30% below market rents in the area, the LDA said. The opening of applications for the cost-rental homes in Dublin and Wicklow comes as the Government is considering widening the eligibility for cost rental schemes to households earning more than €100k, or a net income of €75k to €80k, in an attempt to stem the rental crisis. The Irish Times, 13th March
Housing Target Taoiseach Leo Varadkar has said there is a deficit of 250,000 homes in the country at present and accepted it will take a long time to resolve the State’s continuing housing shortage crisis. Mr. Varadkar told a meeting of the Fine Gael parliamentary party that 30,000 homes were built last year and another 35,000 are under construction in 2023. However, he said the overall deficit in terms of need was at a quarter of a million. The annual target for Housing for All is 33,000 new-build homes each year. Mr. Varadkar pointed out that the 30,000 completions last year did not include student accommodation and derelict properties brought back into use. The Irish Times, 8th March
Blessington, Co Wicklow One of the country’s largest developers warned the Housing Minister and planning officials about the market being “acutely undersupplied” as it lobbied them to accelerate work on a scheme. Glenveagh wrote to Wicklow County Council chief executive Brian Gleeson in January, saying plans to deliver 173 new homes near Blessington were being delayed “outside our control”. The letter was also sent to Housing Minister Darragh O’Brien and a planning official in his department. Glenveagh was granted permission to develop the houses and a nursing home at Blessington Demesne in 2020 under the condition construction did not commence until the builder had written confirmation of work starting on a road near the site. Homes could not be occupied until the road had been completed, unless agreed with planners. The Irish Independent, 12th March
OTHER
Waterford Amgen, the biotech giant, is to scale back its planned €1bn campus in Waterford following its acquisition of Horizon Therapeutics. The US drug company is understood to be assessing plans to reduce the investment to a stand-alone €400m facility, which will either be located in Waterford city or at the company’s existing site in Dún Laoghaire, Co Dublin. In December last year, Amgen announced it had struck a €25bn deal to acquire Horizon, which had secured planning permission just a month earlier for a state-of-the-art drug substance manufacturing facility and office campus in Waterford city, at a cost of between €800m and €1bn. The Business Post, 12th March
Tenant-In-Situ Scheme Just 13 homes, out of more than 400 offered to Dublin local authorities by landlords exiting the market, were bought in recent months under the tenant-in-situ scheme. Under the scheme, restored by Minister for Housing Darragh O’Brien last April, councils are empowered to buy homes offered by landlords who are selling up and where their tenant is in receipt of the HAP, or the Rental Accommodation Scheme (RAS). Figures supplied by Dublin’s four local authorities show fewer than 3% of homes offered by landlords since June last year have been purchased. In all, 460 homes with social housing tenants were offered to Dublin councils since June 1st, 2022, and 13 bought. A further 382 are being examined for possible purchase, of which 92 are described as at “closing” or “sale agreed” stage. One council, Fingal, has bought none. It has been offered 120 and 12 are at sale agreed stage. Dublin City Council has been offered 180 and bought seven. Both Dún Laoghaire-Rathdown and South Dublin County councils have bought three homes, having been offered 23 and 137 respectively. The Irish Times, 10th March
BNPPRE ROI Construction PMI The downturn across Ireland’s construction sector moderated during February amid a broad stabilisation in activity levels and fresh growth in new orders. As such, firms registered strong employment growth and the first uptick in input buying since May last year. There was some less positive news on the pricing front. Input costs and sub-contractor rates increased at faster paces than in January. The headline seasonally adjusted BNP Paribas Real Estate Ireland Construction Total Activity Index remained below the neutral 50.0 threshold in February, posting at 49.8 from 47.7 in January. The reading was indicative of a fifth successive reduction in total activity, but having slowed to the weakest over this period the decline was only fractional. Bucking the wider trend, commercial activity increased modestly and for the first time since last September. The latest upturn, albeit only slight, was the first registered since last March and linked by panel members to strengthening project pipelines and better underlying demand conditions. BNPPRE ROI Construction PMI, 13th March
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