20th February (Issue 134)

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.



Project Glas: 75% state-controlled Permanent TSB has commenced its strategy to clean up its balance sheet by instructing EY to formally launch a €1.5bn portfolio of loans, dubbed as Project Glas. The sale includes buy-to-let mortgages but not private home loans. The number of loans in the portfolio was cut late in the process after the bank reached a deal with 1,000 buy-to-let investors to consensually settle their liabilities. PTSB’s non-performing loans (NPL) account for 28% of its €21bn portfolio, the highest ratio among the domestic banks. The European Central Bank, in charge of supervising euro-zone lenders, is piling pressure on lenders with high levels of NPLs to come up with credible strategies to reduce them over time. The Irish Independent, 14th February



2-4 O’Connell Street Dublin: International Fund AEW has completed the purchase of the landmark building at 2-4 lower O’ Connell Street, Dublin 1 for €12.5m (€1,036 psf) with an initial yield of c. 4.5%. The 12,060 sq. ft. property is let to Ulster Bank at €580k p.a. (€48 psf), with 19 years left to run. The building was initially sold at the height of the property market in 2007, when Ulster Bank disposed of it on a sale and leaseback basis. AEW last year paid c. €20.5m for another high-profile retail premises at 42-43 Henry Street, showing a return of 4.2%. The Irish Times, 14th February

133 Lower Baggot Street: CBRE have brought a restaurant investment at 133 Lower Baggot Street in Dublin 2 to the market quoting €2.1m (€535 psf). The building is currently let to Chez Max at €90k p.a. (€23 psf) equating to an initial yield of 3.95% however there is significant reversionary potential. The three-storey over basement property occupies a prominent pitch close to the Baggot/Pembroke Street junction and extends to c. 3,919 sq. ft. Ground and basement levels are in use as a restaurant/cafe  while upper floors are used as ancillary storage/office space. The Irish Times, 14th February

No. 32 Grafton Street: Irish Life has agreed a rent of €275k p.a. (€123 psf) with Australian stationary giant Smiggle for No. 32 Grafton Street. The store continues Smiggle’s expansion into the Irish market and will be their fourth store in Dublin, with over 100 outlets opened in the UK since 2014.  Smiggle joins a number of other high-profile tenants who have moved into the street in the past 15 months, including Urban Decay, Other Stories and Victoria’s Secret. Directly opposite the planned Smiggle store, Irish Life recently completed the purchase of 80 Grafton Street, which is rented by Molton Brown on a 25-year lease from 2014. The Irish Times, 14th February



Boland Quay Dublin: The Irish Independent understands heads of terms have been agreed between Google and the Nama-appointed receiver Savills Ireland, over the development of the €170m Boland’s Quay project by BAM Ireland. Upon completion, Boland’s Quay will include three new landmark buildings, with the tallest rising to c. 173 ft. There will also be a 15-storey apartment block rising to c. 157 ft. and a 13-storey office building extending to c. 161 ft. The scheme will comprise some c. 397k sq. ft. of office, residential, retail and cultural space and accommodate up to 2,500 workers. The project will also include a new pedestrian bridge, two new civic plazas with water frontage to Grand Canal Dock and a cultural/community space of 5,910 sq. ft. The scheme will represent Google’s most significant investment in the Dublin property market to date. The Irish Independent, 15th February

Irish Nationwide HQ: Plans for a multi-million euro refurbishment of the former Irish Nationwide headquarters in Dublin and the construction of 115,000 sq. ft. of new office space on the site, have been appealed to An Bord Pleanala. Dublin City Council approved the plans last month, but now An Bord Pleanala will assess the project, which would result in significant new office space in the capital. The existing office block on the site is more than 50 years old and is a protected structure. The prime location, in the capital’s business heartland at Grand Parade, is situated next to the Grand Canal. The existing eight-storey, 39,200 sq. ft. office block sits on a 1.7 acre site. The remainder of the site includes old warehouses and almost 100 parking spaces. US property investment giant Hines and Hong Kong’s wealthy Yeung family jointly purchased the site in 2016 for €37m, €22m more than the previous owners paid for the site from the special liquidators of IBRC in early 2015. The Irish Independent, 17th February

Shelbourne Plaza: Agent CBRE is guiding a price of €3.75m (€659 psf) for Shelbourne Plaza, a modern office space extending to 5,685 sq. ft. located at Charlotte Quay in the South Docks area within the Dublin Docklands. The South Docklands has established itself as one of Dublin’s leading office districts and is home to some of the world’s largest international corporate occupiers, including Google, Facebook, Accenture and law firm Mason Hayes & Curran. The Irish Independent, 15th February

Trident House Blackrock: BNP Paribas is quoting a rent of €32.50 psf for an office block in Blackrock, Co. Dublin, which will be available in Q3 2018. Trident House, which forms part of Blackrock Shopping Centre, is a four-storey over basement building extending to 18,804 sq. ft. with 21 on-site car spaces. The building which was previously occupied by the OPW for over 30 years is currently being extensively refurbished by landlord Friends First. The company has also just started to redevelop the adjacent 69,965 sq. ft. office site at Enterprise House, where it has secured a pre-let to Zurich Life on a new 20-year lease term, and this will be ready in 2019. The Irish Times, 13th February 

Capel Building Dublin: CBRE have brought a penthouse office suite in a modern office building beside the Luas line in Dublin 7 to the market guiding €1.1m (€445 psf). Unit 511 in the Capel Building on Mary’s Abbey extends to c. 2,468 sq. ft. and comes to the market with vacant possession. Some of the features include an open-plan layout, two large meeting rooms, space for 48 desks, large floor-to-ceiling windows and a private balcony with views of the city. The Capel Building is a mixed-use building with multiple tenants on every floor. On-site amenities include a cafe, gym, showers, reception and controlled-access lifts. The Irish Times, 13th February



TIFCO Hotel Group: According to accounts published, the The Goldman Sachs-backed TIFCO hotel group paid €45.7m for the 2016 purchase of the 12-hotel Travelodge business in Ireland. The accounts also confirm that the group paid €13.3m for the Parliament hotel and the adjacent Fashion House building in Temple Bar in Dublin in July 2016. The group has since secured planning permission for a 77-bedroom extension to the hotel. TIFCO has 25 hotel properties in total with over 2,520 hotel rooms. The group’s pre-tax profits increased marginally to €2.8m in 2016 as revenues increased by 38% to €45.26m. The book value of the group’s assets in 2016 increased from €94.3m to €183m through a mix of acquisitions and revaluations. The Irish Independent, 20th February

Aparthotel Market: The Sunday Business Post reports that the supply of short stay apartments for the tourist and corporate markets looks set to increase four fold in Dublin with more than 2,600 units in the pipeline across 13 new aparthotels. At present there are only 16 aparthotels in Ireland, with 672 units – an average of 42 units each. Ten are located in Dublin and Staycity is the largest player in Ireland with 46% of the units. Staycity plans to open four new aparthotels with 734 units in Dublin by 2020. Two of these are currently being developed close to Pearse Street: one at Mark Street, with 142 units, and the other at Moss Street, with 202 units. Next year, the firm will open a 50-unit property at Chancery Lane, near Dublin Castle. The increased supply of aparthotels will compete with the hundreds of private owners who let their apartments let through Airbnb. The Sunday Business Post, 18th December



Dunville Close Ranelagh: Agent Finnegan Menton is seeking offers of €4.9m for a 1.25 acre residential site at Dunville Close, within 500m of the centre of Ranelagh. The south Dublin site, which includes a redbrick house along the entrance, comes with Z1 residential zoning and a feasibility study includes the options of 20 semi-detached and terraced houses or a low-rise development of 45 apartments. The purchaser will have the option of using the side garden of an adjoining house at 1 Annesley Park to widen the entrance to the development site. The four-bedroom end-of-terrace house, which is included in the sale, will still have front and rear gardens. The Irish Times, 14th February

Smithfield Lofts Dublin 7: Savills have sold Smithfield Lofts in Dublin 7, a five-storey over basement mixed-use building containing 57 apartments, six two-storey townhouses and commercial units to US investment firm LRC for c. €10m. The property was sold on behalf of receivers Deloitte for c. €750k above guide price and reflects a gross yield of c. 6.25%. LRC have been active in the Dublin residential market in the last 12 months and now has a residential portfolio here of more than 500 units. They are also contracted to acquire the 323-bed Custom House Dublin Hilton Hotel as part of its expansion into the leisure sector. The Irish Times, 14th February

Navan Road Castleknock: A development site for 36 apartments off the old Navan Road in Castleknock, Dublin 15, is expected to attract considerable interest among developers and investors. Agent Finnegan Menton has brought Brady’s Castleknock Inn to the market quoting €2.85m (€79k per site). The landmark bar is set to be redeveloped to accommodate 36 two and three-bedroom apartments and penthouses. There will be basement parking for 69 car spaces and 50 bicycles as well as a number of storage units. The 0.8-acre site is located along a cul de sac that ends at the Royal Canal beside the 12th Lock boutique hotel. The Irish Times, 14th February

Blackcastle Lands Navan: CBRE have brought a 59-acre site zoned for high-density residential development on the outskirts of Navan, Co Meath to the market guiding €8.5m (€144k per acre). The Blackcastle lands, located between the Slane and Kingscourt roads and currently in agricultural use, form part of the Navan Development Plan, which was originally intended to speed up new housing schemes in the area. The lands which were offered for sale in 2016 but did not attract a buyer, were previously designated in the Strategic Development Zone (SDZ) and could potentially accommodate 1,100 houses, including a new high street with shops and civic buildings, cafes, primary school and a medical centre. The Irish Times, 14th February

Tullyallen Roundabout Site: Agent Knight Frank is guiding a price of €1.5m (€20k per acre) for a 75 acre land holding at the Tullyallen Roundabout Junction of the M1 Motorway near Drogheda town in Co Louth. The lands are divided into four holdings to the east and west of the motorway, and are being made available for sale in their entire or in lots. Under the 2004 North Drogheda Environs Local Area Plan, 17.5 acres are zoned residential, 47 acres are zoned for Tourism & Leisure and the remaining 10.5 acres are unzoned. Irish Times, 14th February

Kilternan Site South Dublin: Receivers Duff & Phelps are seeking planning permission to build 141 dwellings on a site previously owned by Ellen Construction in Kilternan, south Dublin. The receivers have applied to An Bord Pleanala to build 98 houses and 43 apartments on the site under the strategic development rules which could potentially have approval by May of this year. The land is between the Glenamuck and Kilternan roads in a part of south Dublin already earmarked for housing development and the receivers intend building three and four-bedroom homes, one and two-bedroom apartments and a crèche. They are also pledging to build roads into the proposed housing estate and to upgrade a nearby junction in line with the Council’s plan for the area. The Irish Times, 16th February



Core Industrial REIT: Core Industrial REIT has a pipeline of up to €220m in acquisitions under active consideration with c. €14.5m currently under negotiation. The property investment vehicle plans to raise €225m on the Dublin and London stock exchanges in the next month and has identified up to €650m worth of deals in the medium term. This includes over €300m of assets expected to be sold by NAMA and other banks that are looking to reduce their non-performing loan books. The Sunday Business Post, 18th December

Manufacturing Facility Mulhuddart: A manufacturing facility in Mulhuddart, Dublin 15, comprising 96,000 sq. ft. across two buildings on a 6.1 acre site has been brought to the market by agent William Harvey Ltd seeking €3.75m (€39 psf). The site is currently occupied by Rennicks, who manufacture road signage and are moving to another facility, is being offered with vacant possession and has the potential to expand or re-develop, subject to planning permission. The zoning of the property allows for enterprise and employment including manufacturing, distribution, warehousing and other general employment uses. The property is just a nine-minute drive to the M50 motorway and just 15 minutes to the Dublin Port Tunnel. The Irish Independent, 15th February


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