16th January (Issue 129)
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
Project Redwood: AIB’s Project Redwood loan portfolio sale is drawing attention from a number of potential bidders including Goldman Sachs, Oaktree Capital, Apollo Global Management and Deutsche Bank. The loan portfolio with an expected par value of c. €3.75bn consists of a mix of commercial property loans and buy-to-let residential mortgages. First round bids are expected by the end of January with the sale expected to close before the end of June. The sale comes as AIB looks to cut its level of non-performing loans, which is one of the highest among euro area banks. AIB had non-performing loans totalling c. €12bn at the end of June 2017, which amounts to c. 19% of its total gross loans. According to the European Central Bank, the EU average for non-performing loans as a percentage of total loans is just under 5.5%. RTÉ News, 11th January
RETAIL
Shanahan’s on the Green: The Royal College of Surgeons have been confirmed as the purchasers of the Shanahan’s on the Green restaurant building on the west side of Dublin’s St. Stephen’s Green. The building, which is located beside the Royal College of Surgeons campus, is believed to have cost c. €5m and adds to the college’s major commercial property portfolio in the city. CBRE handled the sale of the property, which has a lease with c. seven years left to run. The current rent of €240k p.a. is due to rise to €290k p.a. in 2019. The Irish Times, 10th January
Lidl Distribution Centre: Kildare County Council have granted Lidl planning permission for the construction of a new 5.8m sq. ft. distribution centre on the Naas Road in Newbridge, Co. Kildare. The development will be one of the biggest building projects in Ireland in 2018 and when complete will employ a workforce of over 350, including 100 new positions. The development will include a large stretch of new public road which will form the first part of the Newbridge bypass. The supermarket has tenders out for the road and distribution centre and expect construction to commence in April. The Irish Times, 11th January
Kildare Village Extension: Planning permission has been granted by Kildare County Council for an extension of c. 67,000 sq. ft. of new floor space at the Kildare Village shopping outlet. The development will consist of one and two-storey buildings directly adjoining the existing complex and will be made up of a number of restaurant/café units, several retail outlets, public toilets and ATMs. Kildare County Council has also given planning permission for an extra 460 car parking spaces over two levels. Kildare Village opened in 2007 and is home to 95 shops of Irish and international fashion and lifestyle brands. The Irish Examiner, 10th January
Wilton Shopping Centre Expansion: Plans for a c. €100m redevelopment of Wilton Shopping Centre in Bishopstown, Cork have been announced by the centre’s owners, Clarendon Properties. The proposed expansion would see a substantial expansion to the existing Penneys retail unit, a 14-screen cinema, a 190-bed hotel and a seven-storey car park. A new entrance to the shopping centre via Sarsfield Road is also proposed as part of the expansion, in an attempt to alleviate traffic concerns. The Evening Echo, 12th January
OFFICE
The EXO Building: The development site of the EXO Building at Point Square in Dublin City’s north docklands, potentially Dublin’s tallest office building, has been acquired by the European Property Investor Special Opportunities IV (EPISO4), from the NAMA appointed receivers, Stephen Tennant and Paul McCann of Grant Thornton. The fund were assisted in the transaction by their local partner SW3 Capital and this represents their third investment together. While the price paid for the site has not been released, it is expected that the purchasers will be providing between €70m and €80m in development finance to complete the project. The project is expected to create 350 construction jobs and upon completion the building will rise to 73m and comprise of 169,150 sq. ft. of Grade A office space capable of housing c. 2,000 workers. The Irish Independent, 10th January
HOTEL
Iveagh Garden Hotel: The new four-star 150-bedroom Iveagh Garden Hotel on Harcourt Street in Dublin city centre is on schedule to open in early February. Renowned hoteliers Brian and Sally McGill, who also own the Harcourt Hotel and Harrington Hall, have invested c. €40m in the hotel. Construction of the hotel has taken two years, during which time the existing four-storey building was renovated and two additional storeys were added. The Sunday Business Post, 14th January
RESIDENTIAL / LAND
UCD Student Housing: A proposed €300m on-campus student accommodation complex at UCD has become the first development approved by An Bord Pleanála under the new “fast track” planning process. UCD was granted planning permission for the construction of 2,178 beds, its largest student accommodation scheme to date, in just over three months using the new Strategic Housing Development scheme. The development will increase the student population living on-campus from 3,179 to 5,357. The development is to be completed in six blocks, ranging from five to ten storeys in height. The Higher Education Authority has estimated a need for c. 25,000 additional student beds nationally with the shortage at its worst in Dublin. The Irish Times, 12th January
Viscount Securities Planning Application: An application by Michael Cotter’s Viscount Securities for 927 residential units in Leopardstown, south Dublin, has been denied planning permission by An Bord Pleanála, who reviewed the application under the fast track planning process. Among the concerns raised when declining the application was that insufficient information was provided with regards to storm water management, as the area is prone to flooding. The Irish Times, 16th January
Cherrywood Development: Hines have entered into a joint venture with the Dutch pension investor APG to facilitate the development of 1,221 build-to-rent apartments at Cherrywood in south Dublin. The €450m development will include shops and cafés at street level and forms part of plans to build a new town in Cherrywood, which is a government-designated Strategic Development Zone. While APG is involved in a number of other projects in Ireland, this is their largest investment in the country to date. The Sunday Business Post, 16th January
Planning Applications: An Bord Pleanála has received 13 planning applications that could see the development of c. 4,000 housing units under the Government’s new “fast track” planning system. The new system was introduced to address the current housing crisis and allows developers to bypass local authority planning processes for developments of more than 100 homes or blocks of 200 student bed spaces. The Irish Times reports that the An Bord Pleanála website showed 10 live applications for residential housing – five in Dublin, two each in Kildare and Galway and one in Cork. They involve proposals to build 2,244 houses and 1,744 apartments. There are also three separate fast-track planning applications for student accommodation in Dublin and Cork, the largest one by Cairn Homes for 576 bed spaces and 103 student apartments in Stillorgan, Co. Dublin. The Irish Times, 15th January
Dorset Street Student Accommodation: A planning application from Minfey Ltd for a 161-bed student accommodation development in Dublin city centre has been registered with Dublin City Council. The application proposes to demolish properties at the junction of Dorset Street Lower and North Circular Road to facilitate the development of the 65,000 sq. ft., 161-bed, six-storey over-basement project. Minfey Ltd is controlled by Paschal and Shane Taggart. NAMA Wine Lake, 14th January
Santry Development: Quayspoint Propertiez Ltd has sought planning permission from Dublin City Council for an 89 apartment development in Santry, north Dublin. The application proposes that the five-storey over-basement development will contain 34 one-beds, 41 two-beds and 14 three-beds. The development will also include retail space at ground floor level and 100 car spaces at basement level. Quayspoint was incorporated in 2015 and is controlled by Michelle Moore and Aimee Bourke. NAMA Wine Lake, 14th January
Clontarf Development: MKN Property Group has sought planning permission from Dublin City Council to use a nursing home site in Clontarf in north Dublin for a 72-unit residential development. The application proposes that the Verville Retreat nursing home will be converted into nine apartments (three one-beds and six two-beds), two four-storey blocks will be built and an outbuilding will be converted into a two-bed mews house. The two four-storey blocks will facilitate the development of one studio, 20 one-beds, 33 two-beds and eight three-beds. The development will include 69 car spaces and bicycle storage at basement level. MKN is an entity within the McKeon group, controlled by Brian, John and Sean McKeon. NAMA Wine Lake, 14th January
CSO Residential Rents: The latest figures from the CSO on residential rents show national residential property prices rose by 11.6% in the 12 month period ending November 2017, with Dublin prices rising by 11.3%. In the month of November 2017 alone, national prices rose by 1.1%, with Dublin prices rising by 0.9%. Excluding Dublin, national property prices rose by 11.7% in the year to November 2017, with the West of Ireland recording the highest growth, at 16%. Nationally, prices remain 23.1% below their peak from 2007. Central Statistics Office, 11th January
OTHER
Mallow Primary Healthcare Centre: The listed UK healthcare REIT Primary Health Properties (PHP) have purchased the Mallow Primary Healthcare Centre in Cork in an off-market deal for €20m. PHP, who already own 304 primary healthcare properties in Britain and three in Ireland, have committed a minimum of €150m to investment in Ireland. The state-of-the-art Mallow centre opened in 2010 and is one of the largest primary care centres in the country, with c. 60,000 sq. ft. of floor space. The centre produces an annual rent of €1.288m. The HSE is the main tenant in the facility, occupying c. 40,000 sq. ft. under a 25-year lease at rent of €824k p.a. The Irish Times, 16th January
Conna Nursing Home: The Ditchley Group, which is backed by iNua, has acquired the 50-bed Conna nursing home, which is located near Fermoy in Co. Cork. The Ditchley Group already owns care homes in Galway City, Tralee (Kerry) and Belgooly (Cork). The Sunday Times, 14th January
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