22nd February (Issue 335)
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
Harcourt Street, Dublin 2 Savills is guiding €45m (4.85% NIY) for 87-88 Harcourt Street, Dublin 2 which is occupied entirely by Byrne Wallace on a 25-year lease from November 2003. The passing rent equates to €44.39 per sq. ft. (excluding car parking). The lease includes a break option for the tenant in November 2023. If the break is not exercised, the lease is subject to an upward-only rent review. There is basement car parking for 46 cars with separate car lifts for access and egress. The Irish Times, 16th February
For lending terms on this asset please contact rossmetcalfe@origincapital.ie
Merchant’s Quay, Dublin French investor Corum Asset Management has paid €23.5m for the Marshalsea Building at Merchant’s Quay in Dublin city centre. The property comprises 43,335 sq. ft. of refurbished office accommodation and is fully let to nine tenants with a weighted average unexpired lease term of five years and an annual rent roll of €1.45m. 70% of the floor area is occupied by State-backed/NGO organisations. Tenants include BDO (sub-let to the HSE), Dublin City Council, Irish Motor Neurone Disease, GCS Recruitment and Microchip Technologies. The Irish Times, 16th February
Thomas Street, Dublin 8 Knight Frank is guiding €14.75m (5% NIY) for Sixty-One Thomas Street. The building consists of 13,189 sq. ft. of grade A office accommodation over four floors with a bar/restaurant/cafe trading as John’s Bar and Haberdashery on the ground floor extending to 3,452 sq. ft. The property is fully let and generating total rental income of €810.2k pa. and WAULT of over seven years. There are seven secure car spaces and 32 bike spaces. The building’s ESG credentials are investment grade with a BER rating of B1 (LEED Gold equivalent). The Irish Times, 16th February
IFSC, Dublin Iput Real Estate has entered into a partnership with A&L Goodbody with the aim of creating Ireland’s most sustainable building through the redevelopment of the law firm’s headquarters in Dublin’s IFSC. The proposed redevelopment of 25 North Wall Quay will see the building’s existing footprint increase by 36% to 155k sq. ft. The redeveloped building will also include electric car charging stations, 200 bicycle spaces, 200 lockers, a fitness room and changing facilities. The development’s embodied carbon will be reduced by 60%. The Irish Times, 16th February
INDUSTRIAL
Dundalk, Co Louth Horseware Ireland, an equestrian and pet products business, is selling its two industrial facilities in Finnabair Business Park, Dundalk, Co Louth. CBRE is guiding €4.75m for Building 1 and €6.5m for Building 2. Located on unadjoining sites, the two offer a combined floor area of 199,057 sq. ft. Building One extends to 79,416 sq. ft. on a 5.68-acre site. Its two-storey offices extend to 19,084 sq. ft. Building Two, the former HQ of Horseware Ireland, extends to 119,641 sq. ft. on 6.67 acres. The warehouse and production area extends to 62,172 sq. ft. The two-storey offices which extend to 54,713 sq. ft., have been well finished. The building also benefits from 176 car-parking spaces. The Irish Independent, 20th February
HOSPITALITY
Draft Hotel Development Plan, Dublin Whitbread, the listed UK hospitality group that owns the Premier Inn budget hotel brand, has urged Dublin city planners to water down proposed development rules that would limit the number of new hotels, as it chases sites in the city centre to build up to 2,500 new rooms. The company is currently building three Premier Inns in Dublin with construction on a fourth new project due to start in the summer, bringing its total room count in the capital to just over 1,000. In the draft development plan, the council proposes to prevent the “over concentration” of new hotel development by requiring all applicants for new hotels to submit a report to the council of all existing and proposed hotels and aparthotels within a 1km radius. The proposed rules would also require planners to consider a new hotel proposal in the context of how many student accommodation facilities were in the area, as well as hotels and aparthotels. The Irish Times, 18th February
Merrion Street Upper, Dublin 2 The Hastings Hotel Group has been seeking a buyer for its stake in the five-star Merrion Hotel. Industry sources suggested that the high-end Dublin hotel would fetch around €1m a key or €141m in total. The Northern Irish Hastings Hotel Group has a 50% share in the Merrion which would equate to c. €70m. The group’s hotels include the Europa Hotel, the Grand Central hotel and the Culloden Estate and Spa in Belfast. The Merrion Hotel, one of the most luxurious hotels in Dublin, had a challenging 2020 due to Covid-19, with revenues down from €26.6m to €17.5m. The Irish Independent, 20th February
Holiday Inn, Dublin Airport The 421-bedroom Holiday Inn at Dublin Airport has shut its doors to the general public after less than seven months in operation. It is understood the €50m hotel is being lined up by the State to operate as an accommodation centre for asylum seekers. The four-star property was opened only last July by the UK-based JMK Group. It is the fourth biggest hotel in Dublin, after Citywest and the Clayton hotels on Burlington Road and at the airport. The International Protection Accommodation Service (IPAS), the office of the Department of Children that houses asylum seekers already has six accommodation deals with hotels in Dublin. The Irish Times, 22nd February
RETAIL
Shopping Centre Portfolio, Harcourt Group is considering a sale of its portfolio of six shopping centres, which includes the Parkway shopping centre in Limerick, Laois shopping centre in Portlaoise and Galway shopping centre in the western capital. Harcourt’s main lender Apollo Global Management has retained agents JLL to advise on its strategy for the assets. Apollo purchased a total of €625m of Harcourt Group loans from Nama for just over €300m in August 2017. The portfolio, which also includes Donaghmede shopping centre in Dublin, the Longwalk centre in Dundalk, Co Louth, and Letterkenny shopping centre in Donegal, was valued at €139m at the end of 2020. Market sources say that the portfolio has a rent roll of c. €10m. The Sunday Times, 20th February
For lending terms on this asset please contact rossmetcalfe@origincapital.ie
RESIDENTIAL / DEVELOPMENT
Goatstown, South Dublin Kelly Walsh are guiding €11.25m for Grove House in south Dublin. The development comprises a five-storey over-basement residential block of 19 apartments with associated car parking facing on to Goatstown Road. The development, which is fully let, is currently generating c. €522k pa. and has 21 car-parking spaces at basement and surface level, with eight electric car charging points. The Irish Times, 16th February
For lending terms on this asset please contact rossmetcalfe@origincapital.ie
Elmpark Green, Dublin 4 Property developer Red Rock Developments has acquired a prime residential site in Dublin 4 with plans for 80 high-end apartments and a residents’ club house. The scheme is expected to be launched next year. The developer has acquired a 1.4 acre site at the Elmpark Green Development on the Rock Road for €7.025m. This works out at €96k per unit, based on the planning permission in place for 73 apartments. The Irish Times, 16th February
Newbridge, Co Kildare A development site that has full planning permission for 204 homes at Ballymany, Newbridge, Co Kildare, is being brought to the market by joint agents DNG New Homes and DNG Doyle at a guide price of €9.5m. The 16.7 acre site benefits from planning permission to develop a large scale development of 204 new residential homes, comprising 98 two, three and four-bedroom houses, and 106 one, two and three-bedroom duplexes and own-door apartments. The site also has permission for a creche. The Irish Times, 16th February
Irish Development Land Market Report Savills The value of development land sales in Ireland last year rose 11% to €648m, according to a new property report from Savills. The company said c. six out of every 10 land deals last year were for sites in the residential sector. A further €450m worth of land deals are currently sale agreed, or the lands are being marketed. It said this made it confident of another “robust” year for land sales in 2022. Savills said land in prime areas with planning permission in place attracted strong bidding across sectors. “Even sites without planning permission have performed well if they are sufficiently well located, as evidenced by the sale of City Quay for €40.5m in Q3. The price achieved was well ahead of the guide of €35m and attracted a deep pool of bidders.” The report highlights that the largest land deal last year was Eagle Street Partners’ €78m purchase of a six-acre site at Castleforbes Business Park. The Irish Times, 21st February
Clontarf Golf Club, Dublin 3 Property developer Green Land Capital has told Dublin City Council that up to 5,000 new homes could be built on the grounds of Clontarf Golf Club if the 75-acre site is rezoned for residential purposes, and if members of the club agree to move to a new course on lands that were once part of the Abbeville estate in Kinsealy. The council currently owns 62 acres of the site, with the golf club holding 10.6 acres and State transport group CIÉ owning 2.6 acres. The developer would have to secure agreement from the council and CIÉ as landowners and the members of the golf club, in addition to securing permission from Fingal County Council for the new golf course on the Kinsealy lands. The Irish Times, 17th February
Mallow, Co Cork Lisney is offering prime residential development land for sale close to Mallow town centre in Co Cork. The property comprises an overall landholding of c. 90 acres which is laid out in two main sections. The northern section consists of c. 47.68 acres of zoned residential development land with access from St Joseph’s Road. It has potential for residential development and a continuation of the adjoining Castlepark residential scheme, subject to planning permission. The property is for sale by tender in one lot, with a guide sale price of €2.35m. The tender deadline is 3pm on Thursday, March 31st. The Business Post, 20th February
Citywest Business Campus, West Dublin JLL are guiding €2.25m for three prime development sites in the heart of Citywest Business Campus. The sites collectively extend to 5.3 acres and are split into 1.1, 1.9 and 2.3-acre plots. They form part of the highly successful Lake Drive office area within Citywest, and are situated within the main central office sector of this sought-after business campus. The Business Post, 20th February
Merrion Road, Dublin 4 The Religious Sisters of Charity have urged planners to allow housing on their land at Merrion Road in south Dublin, in a move that could value the site at €50m if it is sold for residential development. The property, adjacent to St Vincent’s hospital complex and the new national maternity hospital site, is in a “prime” suburban location. In a formal submission to the council, they said the site buildings are physically and functionally obsolete and argued that “underutilised” land opens up an opportunity to deliver “high quality residential development and address housing need”. Advisers to the Sisters asked to change the zoning on c. 9.88 acres of its 16.2-acre campus to reflect the “future development potential” of institutional lands. The Irish Times, 22nd February
OTHER
Construction Costs, Ireland Soaring construction costs threaten to stall new home building in the country, a multinational surveyors’ firm has warned. The inflation that added as much as 23% to costs of key materials including timber in 2021 will continue to the end of this year, when it will begin easing, says surveying firm Linesight. However, rising costs over the last year have prompted developers to put new home building projects on hold. The surveyor added that high site costs and planning issues were adding to the problem. Linesight expects materials inflation and supply disruption to continue this year, but with less volatility than in 2021. Local shortages and high import prices pushed the cost of timber up 23% last year to c. €7.4 a sq. ft. from €6 a sq. ft. in 2020. Linesight expects supplies to improve this year but prices to remain relatively high. Government delays in issuing licences needed to fell timber have been squeezing supplies for more than two years. Copper surged 43% last year to €7,901 a tonne. Cement rose 4.4% to €217 a tonne. Diesel jumped c. 18% to €1.42 a litre, reflecting high energy costs. Workers’ wages are due to increase from this month, with tradespeople earning €20.52 an hour, from €19.96. The Irish Times, 16th February
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