19th December (Issue 428)
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
Molesworth Street, Dublin 2 Waste tycoon Eamon Waters has reached a multi-million-euro agreement to buy Dublin’s Buswells Hotel. Waters agreed terms on a €16.4m sale of the city centre hotel earlier this year. It has emerged, however, that new bidders have also expressed an interest in acquiring the property and no deal has yet been concluded. The Business Post has learned that heads of terms were agreed between Sretaw, his private equity firm, and Interpath Advisory in August. Buswell is being sold by Savills on behalf of special liquidators of the Irish Bank Resolution Corporation. It has a guide price of €22m. Under the terms of the proposed deal, Waters’ Sretaw entered into an exclusivity period until the end of September. The bulk of the sale price was to be paid this week, with the proposed acquisition set to close on January 1, 2024. The agreed price of more than €16m in cash included payment of a €1m deposit on the date of signing, with the balance to be paid by the end of the year. The Business Post, 17th December
Mount Street, Dublin 2 Esprit Investments is seeking permission to build what will be one of Dublin’s biggest hotels on Mount Street. A planning application lodged with Dublin City Council just days ago shows that Esprit intends building a 300-bedroom hotel and apartments on a site bounded by Mount Street Upper, James’s Place East and Herbert Street in central Dublin. The application seeks permission to demolish existing buildings at 38 to 43 James’s Place East and replace them with a seven-storey hotel. Esprit is also applying to convert 38 to 40 Mount Street Upper from offices to incorporate them into the hotel. Dublin City Council’s planning section website states that Esprit’s application is open to observations from the public until January 15th 2024. The Irish Times, 14th December
Sandyford Business Park, Dublin 18 Whitbread has purchased the long leasehold interest of a site in Sandyford Business Park. The 0.57-acre site marks its first acquisition in outer Dublin, as the group eyes a portfolio of 3,500 Premier Inn rooms in Ireland. Located at 5 Arkle Road, the plot is currently occupied by The Wall Climbing Gym. The building extends to 13,283 sq. ft and includes approx. 24 car park spaces. Prior to the gym, the space was let to Crossan Motors. Whitbread plans to bring forward proposals for a 150-bedroom Premier Inn, with the planning application to be submitted in the new year. Currently, the hospitality group operates four Premier Inn hotels in Dublin City Centre as well as another hotel at Swords near Dublin airport. React News, 14th December
South Frederick Street, Dublin 2 JMK Group, a UK-based hospitality company, has emerged as the frontrunner to buy the old New Ireland Assurance offices on South Frederick Street in Dublin City Centre. The property came on the market in October for €12m. While it is in the early stages of the property sale, which is being marketed by CBRE, The Sunday Times understands that JMK is close to doing a deal. Nos. 5-9 South Frederick Street formed part of New Ireland’s old headquarters. The Dawson Street segment of the headquarters was sold in 2018 for €38m to Core Capital and Oakmount. The Dawson Street offices have since been redeveloped and let to the stockbroker Goodbody, with the ground floor earmarked for a restaurant. The South Frederick Street building measures approx. 39,000 sq. ft, comprising five storeys of office space over a basement car park. The Sunday Times, 17th December
MIXED-USE
Naas, Co Kildare The former owners of the Leinster Leader newspaper have sold its former premises on a 0.4-acre site in the centre of Naas for €1m. That price was 54% more than the €650k which Jordan Auctioneers had quoted for it prior to its recent auction. The vendor is Clylim Properties Limited. Located at 19 & 20 South Main Street, Naas, the property includes a three-storey office building extending to 5,705 sq. ft; a residence extending to 1,906 sq. ft, known as the Manager’s House, as well as a former printing works to the rear extending to 10,495 sq. ft. The Irish Independent, 14th December
RETAIL
Santry, Dublin 9 The Cosgrave family of property developers have sold a retail park in an off-market deal. Gulliver’s retail park in Santry was sold for in excess of €30m to a group of wealthy individuals. The retail park, which was built in 2005, has 16 units, and shops on the site include Lidl, Homebase, EZ Living Interiors and McCabes Pharmacy. McDonald’s, the fast-food giant, and Costa Coffee are also at the retail park. Jysk, the Danish furniture retailer, opened its first Dublin store at Gulliver’s in 2020. The chain signed a ten-year lease with the Cosgraves, paying an annual rent of more than €107k, according to the property price register. Gulliver’s retail park was opened as part of the expansion of the Northwood business campus, which lies off the M50 exit to Ballymun. The Cosgrave brothers bought 50 acres for approx. €28m from the IDA. The Sunday Times, 17th December
Grafton Street, Dublin 2 Swatch, the Swiss watchmaker, is preparing to reopen a shop in Dublin, as Grafton Street continues to recover from the pandemic. The company closed its previous store, at No. 55 on the prime shopping street, in 2020 but will soon reopen at No. 80. In a planning application submitted to Dublin City Council last week, Swatch proposed turning the ground floor of the store, which is next door to Bewley’s café, into a retail area for “jewellery and associated items”. The shop is currently occupied by Molton Brown, the beauty brand. The Sunday Times, 17th December
OFFICE
Clonskeagh, Dublin 14 The guide price for vacant offices at Block 7 Richview Office Park, Clonskeagh has been reduced from €3.5m to €3m. Located on a complex adjoining UCD, the property comprises 8,600 sq. ft in a three-storey office building which is laid out with reception space at ground level and a mix of open plan and meeting rooms on the two upper floors. It also comes with 24 dedicated surface car spaces. In 2014 a private investor paid €3.3m for the premises which was then the Irish head office of McDonald’s Restaurants generating an annual rent of €256.3k, giving the new owner a 7.32% yield. The Irish Independent, 14th December
RESIDENTIAL / DEVELOPMENT
James Street, Dublin 8 A partly let apartment block at 181 James St and located between St James’s Hospital and the Royal Hospital Kilmainham, sold at a recent auction for €1.211m, or 42% over the €850k guide price quoted by Artis estate agents. Comprising five apartments and a ground floor retail unit extending to a combined 5,539 sq. ft, two of the apartments were tenanted with rents totalling €34.7k pa. The other units were vacant. It is surrounded on three sides by a cleared site with planning permission for a 145-bedroom hotel. The Irish Independent, 14th December
Clongriffin, Dublin 13 The Land Development Agency (LDA) has paid €44m for a large tract of land in Clongriffin that has the capacity for more than 2,300 homes. The 32.6 acres of land, spread across two sites beside Clongriffin railway station, has been acquired from NAMA. The residential developments planned for the sites, which are 27.4- and 5.2- acres in size respectively, have been dubbed Project Capital North and Barina. The permissions in place for the Project Capital North site involves four separate applications for 1,823 units. The LDA has said it plans to prioritise the development of two apartment blocks on the lands to deliver more than 400 homes. Construction on part of the Project Capital North is expected to commence in September 2024, with the first homes delivered on the lands in 2026. The agency plans to reassess the potential of the other permissions and will potentially seek new planning permission for the rest of the site. The Business Post, 18th December
Naas, Co Kildare The construction of 219 affordable and social homes has commenced on the former Devoy Barracks in Naas. Andrews Construction was appointed by the LDA as the contractor and is set to deliver the first homes in 2025. As part of the former Devoy Barracks complex, the site was made available to the LDA by the Housing Agency. The homes will be A-rated and are being constructed on a 10.23-acre site. The housing mix includes 42 two-storey, three-bed houses, 177 apartments and duplexes consisting of 64 one-bed, 105 two-bed and eight three-bed units. An Bord Pleanála approved the Strategic Housing Development in October 2022. The Business Post, 14th December
Galway Port Lands The LDA is in “advanced talks” to take on a three-acre site with potential for 250 homes from the operators of Galway port. It is close to striking an agreement with Galway Harbour Company that would give it control of a three-acre site located in Galway city centre. The land, located within the inner harbour area of the Galway port lands, has the capacity for 250 homes. Galway Harbour Company is a commercial semi-state entity owned by Galway City Council. The Business Post, 17th December
Horgan’s Quay, Cork The first large-scale apartment scheme in Cork City’s docklands is set to go ahead after the LDA swung in behind a stalled Clarendon Properties/Bam Ireland residential project on Horgan’s Quay. The move should see the first of 302 apartments delivered by the end of 2025, with the majority being made available at cost-rental, at least 25% below the regular local market rate. The LDA is also planning to deliver 350 homes at an ESB site in Wilton. The Horgan’s Quay site breakthrough is significant as the absence of residential had been the major gap in the €160m mixed-use development which, to date, consists of two office blocks. The Irish Examiner, 14th December
Residential Tenancies Board (RTB) Survey More than a quarter of small landlords are “likely or very likely” to sell their rental properties in the next five years, new research by the RTB has shown. Since 2020, the RTB has conducted a series of surveys of small, medium and large landlords to ask their views on the Irish rental sector and challenges faced by landlords. Results from the latest survey of small landlords, who own between one and two rental properties, has shown individuals in this cohort of the market are increasingly likely to sell in the next five years. The results showed that 52% are “unlikely or very unlikely” to sell, which was on par with 2020, and 20% of small landlords are “unsure”. As part of Budget 2024, the government announced new tax breaks in a bid to retain small landlords in the market. Further analysis by the RTB of the small landlords who signalled their intention to sell their rental assets has shown that 48% said their “main motivation is that they no longer wish to be a landlord”, up from 45% in 2020. The Business Post, 13th December
House Price Inflation Home prices rose by 2.3% in the year to the end of October, with the growth driven by increases outside of Dublin, new data from the CSO has shown. In Dublin, house prices decreased by 0.6% in the 12-month period, with residential prices up 4.5% in the rest of the country. Over the past 20-month period, property price growth has gradually eased from a 15.1% peak in February 2022 to a near three-year low of 1.1% in August 2023. The following month in September, prices rose by 1.4%. The new data from the CSO has shown that annual house price inflation has accelerated in recent months, as prices grew at their fastest monthly pace in 14 months in October. The CSO data on house prices is based on the body’s Residential Property Price Index, which has tracked prices since 2005. The data has shown that house prices are 5.1% above the highest level at the peak of the property boom in April 2007. Compared to early 2013, property prices nationally are up 134.3%, with prices in Dublin up by 132% from their February 2012 low. The Business Post, 13th December
Land Aggregation Scheme A scheme to bail out local authorities who bought land during the Celtic Tiger era and were unable to repay the loans to the Housing Finance Agency (HFA) has resulted in a potential loss of €80m to the taxpayer, the Public Accounts Committee (PAC) has heard. At a meeting of the committee, Comptroller and Auditor General Séamus McCarthy outlined a report his office completed on the Land Aggregation Scheme. The scheme was established in 2010 to alleviate the financial burden on local authorities related to maturing HFA loans. In all, 73 sites were accepted into the scheme on the basis that they had reasonable development potential for social housing. Approx. €132m was paid for the sites. The lands have since been transferred to the Housing Agency, which is separate to the HFA. As of August 31st, 2023, the Housing Agency retained ownership of 60 sites, with an estimated market value of just over €56m. Its officials said that the gap between what has been paid and their value, plus other costs to the State, could be approx. €80m. The Irish Times, 14th December
Social and Affordable Housing The Government is at risk of missing targets for delivery of social and affordable housing, newly-released figures indicate. Just over 4,800 social homes were delivered in the first nine months of the year, of which 2,642 are new-builds. This is far short of the target for new-builds for the year in Minister Darragh O’Brien’s Housing for All plan, which is set at 9,100. Meanwhile, approx. 2,000 “affordable housing supports” were delivered in the same period, less than half of the 5,500 target. Figures published by the Department of Housing show that 4,815 new social homes were delivered by the end of September. These include 2,642 new-build homes, 1,033 acquisitions and 1,140 homes delivered through leasing programmes. The department also said more than “2,000 affordable housing supports” were delivered in a number of ways, including through approved housing bodies, local authorities and the shared equity First Home Scheme. The Irish Times, 13th December
OTHER
Ballsbridge, Dublin 4 The U.S. government plans to spend approx. $700m acquiring the former Jury’s hotel in Ballsbridge, Dublin, and building a new embassy there. The State Department notified Congress on 11th December that it intends to buy the former Jury’s Hotel in Ballsbridge for approx. $171m, demolish it and construct new embassy buildings on the site. According to a note sent to Congress, the total costs of acquiring and demolishing the existing building and designing a new premises will come to approx. $688.8m, The Associated Press reported. The new building on the old Jury’s site would include the embassy, a residence for U.S. Marine guards, support facilities and parking, the notice to Congress says. Planning permission was granted in December 2022 to split the site, which houses the former Jury’s Hotel and the prestigious Lansdowne Place residential development. While U.S. authorities are thought to have reached an agreement to buy the former Jury’s Hotel from developer Chartered Land, it is expected to remain in its current embassy building for up to 10 years until the construction of the new premises is complete. Bisnow, 18th December
Ires Reit Vision Capital, an activist shareholder in Ires Reit, has called for an extraordinary general meeting (EGM) to allow shareholders oust five directors, in a new letter. The letter by the Canada-based investment firm, which included the demand for an EGM, has come following the announcement in October that Margaret Sweeney will retire as chief executive of Ires Reit next year. Vision Capital has been a shareholder in Ires Reit since 2014 and owns more than 26m ordinary shares in the company, which means it has a 5% stake. Vision Capital’s resolution has proposed the replacement of five directors, including Sweeney, chief executive, Declan Moylan, chair of the board, Brian Fagan, chief financial officer, Joan Garahy and Tom Kavanagh, who are two other directors serving on the remuneration committee. The Business Post, 18th December
Dublin Airport DAA has written to the owners of a 260-acre block of land between the runways at Dublin Airport inviting them to a fresh round of talks over a potential landmark sale of the site. In a letter to aviation tycoon Ulick McEvaddy and his brother Des, along with Seán Fox and Brendan and Orla O’Donoghue, the airport operator reiterated that a bid it lodged earlier this year remained on the table. DAA, the operator of both Dublin and Cork airports, made a €75m offer on the land in September, which was rejected. The consortium is hoping to sell the block of land, which has been described as a strategically located asset, for €210m or more. The block of land remains on the market for sale. It’s understood a decision on the site’s future will be made by the landowners in January. The Business Post, 17th December
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