21st February (Issue 385)

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.

 

OFFICE

Ballsbridge, Dublin 4 Amancio Ortega, the billionaire founder of the Zara fashion chain, has walked away from a €550m deal to acquire Fibonacci Square, the office development in Ballsbridge that forms part of Meta’s European headquarters. Meta, owner of Facebook, signed up for a 25-year lease on the landmark property in November 2018 and agreed to pay an annual rent of €22.5m. But last year, in the aftermath of swingeing job cuts at the technology giant, it reversed course and decided to occupy only the space at the rear of the Ballsbridge site. According to real estate sources, the U-turn helped derail the deal with Ortega. Under the current contract between Meta and its landlords, the first break term is not for 15 years. Meta is now seeking a sub-let on the Fibonacci Square blocks. The Sunday Times, 19th February

Cardiff Lane, Dublin 2 The Singapore-headquartered real-estate investment trust Mapletree Investments is seeking a buyer for the Sorting Office, the 202,000 sq. ft home of TikTok in Dublin’s south docklands. The guide price is understood to be €280m (NIY 4%) – or c. €40m more than Mapletree paid to secure ownership of the office scheme from Marlet Property Group and its finance partners, M&G Investments, in 2019. TikTok signed a long-term lease in December 2021 in which it committed to occupy all 202,000 sq. ft at the Cardiff Lane property on the basis of a 15-year lease, with 10 years’ term-certain and a rent-free period of c. 18 months. The rental level agreed for the office scheme is understood to have been between €55 and €60 per sq. ft. The Irish Times, 15th February

87-88 Harcourt Street, Dublin 2 German-headquartered investor AM Alpha recently walked away from the €43m purchase of the Dublin 2 office building, and the guide price has now been slashed to €37m. The initial 16% hike in the building’s price from €45m to €52m had reflected the agreement last April of both a lease extension and a rent increase between its tenant, leading law firm ByrneWallace, and the landlord, receivers EY-Parthenon. With institutional investors increasingly focused on ensuring that their property portfolios meet ESG targets, ByrneWallace’s commitment to occupy the Harcourt Street building until April 2032 with no break option is being viewed by some as an obstacle to addressing the issue of its relatively poor D1 BER rating. The decision to reduce the property’s guide price from €52m to €37m (NIY 6%) may go some way to alleviating that concern. 87-88 Harcourt Street is a modern office block extending to 53,312 sq. ft. The Irish Times, 15th March
For lending terms on this asset please contact rossmetcalfe@origincapital.ie

Kildare Street and Nassau Street, Dublin 2 Larry Goodman’s long-planned project to redevelop a string of buildings on the corner of Kildare Street and Nassau Street has hit a fresh setback. Last year, a firm owned by the beef magnate behind the ABP group revealed new plans to convert the former Kildare Street Hotel, and a building that housed JP Mooney’s pub, at 47 and 48 Kildare Street respectively, into offices. Dublin City Council has told Goodman’s property group that although replacement of the properties with a modern contemporary building “may be acceptable”, it has reservations about the “full height glazing” design of the building. Goodman’s firm was refused permission to demolish the buildings by Dublin City Council and Ternary appealed the decision to An Bord Pleanála in February 2020. In late 2020, the property group withdrew the controversial proposal to demolish these structures on Kildare Street. The Business Post, 15th February

Citywest Business Campus, Co Dublin JLL is guiding a price of €8.25m for a high-profile office building at Citywest Business Campus, Dublin. No. 3007 Lake Drive, which is available for sale or lease, comes to the market with the benefit of vacant possession. The property, which overlooks the lake in Citywest, extends to 35,219 sq. ft and has 133 car-parking spaces. The building has undergone a recent refurbishment by the previous tenant and is presented in walk-in condition. The Irish Times, 15th February
For lending terms on this asset please contact rossmetcalfe@origincapital.ie

Haddington Road, Dublin 4 The CPL Group has agreed a deal to relocate its offices to One Haddington Buildings on Haddington Road. The Dublin-headquartered recruitment specialist is the first tenant at the property and will occupy a total of 16,000 sq. ft across the building’s ground and first floors. Joint letting agents HWBC and Savills are now marketing the remaining top two floors comprising 11,800 sq. ft each. The agents are quoting a rent of €52 per sq. ft for the office space and €4k pa per car-parking space. The Irish Times, 15th February

Harmony Row, Dublin 2 A vacant office suite in Dublin city centre is being offered to the occupier and investment markets for sale or rent. Located on the ground floor, 1 Harmony Court extends to 3,170 sq. ft. Agent Mervyn Feely is quoting €1.5m for its sale or €150k pa for its rent guide price. These prices equate to €473 per sq. ft capital cost or €47.32 per sq. ft for rent. It also comes with two parking spaces. The Irish Independent, 16th February

Sandyford, Dublin 18 The Irish arm of US-headquartered telecoms group, Verizon, is offering a third of its office space at the Sandyford Business District in south Dublin to the market. The second floor at Nova Atria North extends to 30,746 sq. ft and is available to let immediately by way of flexible subletting to 2028 or by lease assignment to October 2032. Verizon, for its part, will continue to occupy two floors at the building, comprising a total of 60,000 sq. ft. Cushman & Wakefield is guiding a price of €30 per sq. ft for the second floor while 54 car-parking spaces are available to rent for €1.75k per space pa. The Irish Times, 15th February

Citywest Business Campus, Co Dublin Irish real estate investor and operator Fine Grain Property has acquired Waterside at Citywest Business Campus for an undisclosed sum. Waterside is a 15-acre campus comprising 219,128 sq. ft across five modern office buildings; it brings the total floorspace in Fine Grain’s portfolio to 1,200,000 sq. ft. Current occupiers at Waterside include Fidelity Investments, SAP, Glanbia and Hidden Hearing. Iput and Davy Real Estate, through selling agent Savills, had been seeking offers of €71.5m for the asset. The Business Post, 18th February

 

RETAIL

Athlone Co Westmeath Sports Direct is to open for business at Athlone Towncentre later this year. The company has agreed a deal to occupy 19k sq. ft on the ground floor of the scheme. The new store will see the amalgamation of five existing units and a corresponding investment of €1m which is being funded and undertaken by the Landlord. Two of the scheme’s existing occupiers – Quiz and Art & Hobby – will relocate within the centre to facilitate the delivery of Sport Direct’s new anchor store. The Irish Times, 15th February

Bray, Co Wicklow Penneys has announced it will open a new store in Bray later this year, the retailer’s first in Wicklow. The outlet will be the company’s 38th in Ireland. “Penneys Bray will span 19,600 sq. ft of retail space and will be located in the Bray Central Shopping Centre in the heart of the town,” Penneys said in a statement. The Business Post, 17th February

Drogheda, Co Louth Ikea, the Swedish furniture retailer, has opened a new “plan-and-order” point in Drogheda, Co Louth as part of its expansion plans in Ireland. The store, located in the Scotch Hall shopping centre, will allow customers to book planning consultations with Ikea’s planning specialists to help design their kitchen and bedroom. The Business Post, 20th February

 

HOSPITALITY

Hospitality Sector Fáilte Ireland has said there is an “urgent need” for the Government to adopt a “more balanced approach” to the Ukraine refugee crisis, with a quarter of the State’s tourist accommodation currently unavailable. Fáilte Ireland chief executive Paul Kelly said the tourism sector had lost €12bn in revenue due to Covid-19, only c. half of which was recouped through State supports, and that every tourism business is experiencing an unprecedented rise in operating costs. The Irish Times, 20th February

 

RESIDENTIAL / DEVELOPMENT

Poulgour Road, Kilkenny Cairn Homes has lodged an application for planning permission for the construction of a €46m residential development of 210 residential units. The project comprises 80 apartments ranging from two to three bedrooms and 130 houses ranging from two to four bedrooms. The development is on a site at William Robertson Way, Poulgour Road, Kilkenny. The Business Post, 18th February

Mullingar, Co Westmeath WHS Property Holdings Limited has been granted planning permission for the construction of a €26m residential development of 81 units. The project comprises 16 apartments ranging from one to two bedrooms and 65 houses ranging from two to three bedrooms. The scheme also comprises the construction of a 90-bed nursing home. The development is on a site at Robinstown (Levinge) and Robinstown (Tyrrell), off Castlepollard Road (R394), Mullingar, Co Westmeath. The Business Post, 18th February

Brownsbarn, Dublin 24 Glenveagh Properties has lodged an application for planning permission for the construction of a €74m residential development of 384 units. The project comprises 122 apartments ranging from one to three bedrooms and 262 houses ranging from two to four bedrooms. The development is on a site at Citywest Avenue and west of Cheeverstown Luas Park and Ride, Brownsbarn, Dublin 24. The Business Post, 18th February

Kishoge, Co Dublin Cairn Homes has begun works on site on the construction of a €74m residential development of 569 units at Kishoge, Co Dublin. The first 181 units are under way, comprising 145 dwelling houses and three duplex blocks, namely Blocks A, B and D. The project comprises 396 apartments ranging from one to three bedrooms and 173 two- and three-bedroom houses. The development is on a site within the townlands of Cappagh, Clonburris Little and Kishoge. The Business Post, 18th February

Poolbeg West, Dublin 4 Pembroke Beach DAC has been granted planning permission for the construction of a €96m residential development of 356 units. The project comprises 356 apartments ranging from one to three bedrooms. The development is on a site at the Former Irish Glass Bottle & Fabrizia Sites, Poolbeg West, Dublin 4. The Business Post, 18th February

Beach Road, Dublin 4 Walls Construction has commenced works on the construction of a €25m residential development of 112 units in Dublin 4. The first part of the works comprises the demolition of a former Maxol filling station and vacant motor sales garage. The project comprises 112 one- and two-bedroom apartments. The Business Post, 18th February

Housing Completion Figures The state’s statistics agency has hit back after a construction company said data it published on the number of new homes completed last year showed significant inaccuracies – claiming the body overstated the figure by nearly 6,000. The CSO refuted claims that its figures on home completions were wrong, following questions from Construction Information Services (CIS) – a company that provides information on the industry to building firms. CIS said figures collected by the National Building Control Office (NBCO) were a better guide. The NBCO, the state’s building control regulator, gets certificates of completion from certified architects before a new building is opened, and it derived its figure of new homes in 2022 from the number of these certificates it had received. In a statement, the CSO said the NBCO’s certification system was “not only missing one-off single houses, of which there were more than 5,500 in 2022, it also lacked a consistent method of data collection”, because individual architects or developers provided the information. It said it had decided that using the number of new electricity connections was a more accurate metric because the information is collected by a single organisation in a consistent format. The Business Post, 15th February

Henry Street, Dublin 1 Fitzwilliam Real Estate has appealed the rejection of plans for a 12-storey, 159-unit “build to rent” scheme over part of the Arnotts store in Dublin. The 159 units comprise 60 studios, 85 one-bedroom apartments and 14 two bedroomed units. The scheme involves the construction of a 12 storey over basement element fronting Williams’ Lane, a five-storey element over Arnotts’ multistorey car park and a two-storey element over Arnotts store. A decision is due on the appeal later this year. The Irish Times, 17th February

Social Housing Construction Cost Dublin City Council has been paying in excess of 40% more for the construction of social housing than private sector developers, an independent audit of more than 1,000 Dublin homes has found. Council officials had been “severely restricted” in their ability to control costs within Government and EU procurement rules and systems, according to the report by public management consultancy Seán Ó Riordáin and Associates Ltd and Trinity College economics professor Ronan Lyons. The analysis of 28 housing schemes across the three sectors, with a total of 1,023 homes built between 2019 and the end of last year, found the council was paying 23% more than AHBs and 44% more than private developers for a similar two-bedroom apartment. The review found one-bedroom apartments provided directly by council cost €335k, 11% above the equivalent figure for AHBs (€303k) and 34% above the figure for Part Vs (€250k). For two-bedroom homes, the council construction costs of €514k were 23% above the AHB average of €418k and 44% above the Part V average €358k. The difference in costs could, in part, be attributed to the differing nature of the projects, the report said. Council schemes were generally smaller, with an average of 43 homes compared with a private sector average of 180, of which 18 were set aside for social housing. The Irish Times, 15th February

Glanmire, Co Cork A Cork resident who sold development land next to his home in 2006 has claimed he is now entitled to additional money because of the number of houses planned for the site. The Commercial Court heard the property is earmarked for a €31m scheme of 80 social homes, while Niall O’Donovan has asserted that the 2006 sale deal included a condition that if more than 12 houses were built on the land, he would be entitled to more money. Mr. O’Donovan has asserted that the condition in relation to 12 houses remains in force over the land, next to his home, which he sold to a developer in 2006. Ownership has passed through a number of other hands since the 2006 sale. Berrings Property Investments Ltd, the current owner of the land, says that when it was sold by Mr. O’Donovan, the obligations imposed by special conditions in that 2006 contract were not registered as burdens in the Land Registry. The Irish Times, 15th February

Planning Permissions Galway Recent decisions by An Bord Pleanála to refuse planning permission for housing developments in Galway have been described as “simply baffling” by the city’s mayor. Clodagh Higgins has called for a meeting between senior Government representatives and city officials following the planning body’s rejection of a number of residential applications over the last few months. The council’s chief executive Brendan McGrath earlier this week said he intended to write to the Department of Housing to outline a projected shortfall in the delivery of new social houses for Galway this year, next year and in 2025. There are c. 4,500 people on the city’s social housing waiting list at present. The Irish Times, 15th February

 

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