25th April (Issue 394)

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.



Liffey Valley, Dublin 22 Joint agents Savills and JLL are guiding €26m (7.07% NIY) for the B&Q retail warehouse, located at Liffey Valley retail park. The property extends to 119,213 sq. ft, with an ancillary garden centre of approx 29,000 sq. ft, on a site area of 9.26 acres, and is one of the largest retail warehouses in the country. Due to current planning restrictions, retail warehouses of this size are no longer permitted. The unit also benefits from a large surface car park to the front, with approximately 552 spaces. The asset is single let to B&Q plc on a 25-year upwards only FRI lease from March 2002 and the current rent is €2.02m p.a. The Business Post, 22nd April

Oaktree Capital Management a US private equity firm, is considering disposals from its €400m Irish retail platform, according to React News. Agents Cushman & Wakefield and Bannon have been lined up to review potential exit options for the Square Shopping Centre. After paying €250m for the centre in 2018, Oaktree fought to refinance €186m of debt secured against it in 2021. Existing lender AIB eventually rolled over the facility. There have been several big additions to the mall’s tenant line-up in recent years, including retailer Penney’s and Irish cinema chain Movies. There have also been a number of unsolicited off-market approaches for the retail warehousing element in the Oaktree portfolio. The collection of eight retail parks owned by Oaktree is coveted. The sector has continued to attract investors across Europe over the past few years, and Ireland, which lacks an overdevelopment of parks, has strong supply/demand fundamentals. Oaktree owns Bray Retail Park, Drogheda Retail Park, Waterford Retail Park, Naas Retail Park, Parkway Retail Park, Navan Retail Park, Sligo Retail Park and Gateway Shopping Park. React News, 18th April

Cork City The Irish Examiner reports, that according to sources, contracts have been issued for the sale of Cork city’s iconic retail building vacated by Debenhams, for close to €12m, with the purchaser intending to be an owner occupier. The property occupies 1.6 acres between Merchants Quay Shopping Centre and Brown Thomas, and went to market last year with a €20m guide quoted by agents Cushman & Wakefield. Directly alongside, Savills has brought the former SuperValu supermarket to the letting market after being vacated at €17.50 per sq. ft. That property has over 31,500 sq. ft all on one level, and although it has no external street frontage it faces onto the central rotunda of the Merchants Quay Shopping Centre. The Irish Examiner, 20th April

Ulster Bank Branches Nationwide Ulster Bank is expected to put its remaining branches up for sale before the end of the year. The bank, which closed the final 63 locations it still had open on Friday, owns 31 of those buildings outright. The departing bank’s College Green building in Dublin is seen as the stand-out property of its remaining portfolio given its location. That building will almost certainly be offered for sale in a stand-alone deal. Other branches are likely to be sold individually or in small portfolios given the perceived difficulty in securing a prospective buyer for properties dispersed across the State. The bank is also seeking to negotiate an exit from leases on the 32 branches it rents, in many of which it has been a tenant for decades. The Irish Times, 21st April

Patrick Street, Cork Cushman & Wakefield is guiding €2.5m for No. 39 Patrick Street. The current tenant, Mizen Clothing Retail Ltd, trading as The North Face, is not affected by this sale. Passing rent comprises a base rent of €200k p.a., plus a 9% gross turnover rental top-up p.a. The tenant has a ten-year lease agreement from 1st September 2022, with a break option at the end of year five. The property extends to 8,682 sq. ft GIA over four floors. The Irish Examiner, 20th April



Rosemount Business Park, Ballycoolin, Dublin 15 CBRE is guiding €15.75m (5% NIY) for Unit 35 Rosemount Business Park. The property comprises a 91,186 sq. ft logistics centre on a 4.91 acre site. Unit 35 has a clear internal height of 10.53m, four dock levellers and four grade doors, with yard depths ranging from 40 to 48m and underwent extensive refurbishment in 2021. The property is let to JD Sports Fashion Ireland Limited, with a parent guarantee from JD Sports Fashion PLC, on a 15-year lease from September 2021 with a 10-year break option at €866k p.a. The lease has CPI-linked rent reviews with a cap-and-collar of -1% to 2.5% annually. The Irish Times, 19th April
For lending terms on this asset please contact rossmetcalfe@origincapital.ie

Citywest, Dublin No 34 Magna Avenue at Magna Business Park in Citywest is available for sale or to let through joint agents Harvey and JLL. The property will comprise a 150,000 sq. ft logistics facility when built and while a guide price and rental rate have not been set for the property, its estimated sale value is between €30m and €37.5m (€200 – €250 per sq. ft) and its potential rent at €12.50 per sq. ft. Full planning permission has been obtained for the subject property and discussions are already under way with several potential occupiers. No 34 Magna Avenue will, upon completion, comprise a state-of-the-art warehouse with 14 dock levellers, two level-access doors and a narrow-aisle capacity of 27,700 euro pallets or 21,900 on a wide-aisle basis. Externally, the subject property will have a generous marshalling yard with a separate gated entrance and 18 HGV parking bays. Both the warehouse and its ancillary headquarter office accommodation have a target accreditation of LEED Gold and an A3 Ber rating. The Irish Times, 19th April



Navan, Co. Meath Joint agents BDM Property and REA T&J Gavigan are guiding €1.35m for Ryan’s Bar, Trimgate Street, Navan. The 7,987 sq. ft property comprises a large ground-floor lounge bar with several individually styled and furnished areas including a cocktail bar section. Outside, there is a large beer garden with a covered seating area and veranda. On the first floor there is a function room. Proprietor Mick Ryan, who has traded here for almost 25 years, is retiring from the trade and selling the pub. At present, its food business currently accounts for about 20% of turnover but it has potential to expand into breakfasts, evening and Sunday lunch catering. The pub won “Meath Pub of the Year” in 2022. The Irish Independent, 20th April 

Harold’s Cross, Dublin 6 Lisney Morrisseys is guiding €2m for McGowan’s Pub at 174 Harold’s Cross Road, Dublin 6. The property extends to 4,700 sq. ft over ground floor. Its bar and lounge with fully fitted kitchen, are supplemented with a beer garden to the rear. In addition, two two-storey adjoining residential buildings are laid out as five residential units and one guest bedroom utilised for short term lettings. These residential units comprise a one bedroom and two studios at ground floor level together with a one bedroom and a two bedroom at first floor level, generating €77k p.a. The agent notes that its 0.24-acre site has “clear potential for re-development subject to planning”. The Irish Independent, 20th April

Magheramore, Wicklow Creatively Pacific Ltd has lodged plans with Wicklow County Council for the development of a holiday resort and surf school on the clifftop lands at Magheramore Beach in Co Wicklow. According to an economic and financial evaluation of the project drawn up by economist Jim Power, it will involve investment of €40m. The proposed development will consist of a new two-storey, over lower ground level building containing a gym, sauna, cinema and outdoor pool reception, bar and restaurant, washrooms and outdoor terrace at ground floor. It will also involve construction of a surf school building and 48 “high-quality accommodation pods”. The report submitted notes the proposal will not alter the existing public access to the beach via the existing nuns’ walkway. The application has attracted one objection to date. The Irish Times, 19th April



South Docks, Dublin 4 Agent Avison Young is guiding €3.2m (6.96% NIY) for Riverbank House, a high-profile office block at the junction of Ringsend Road and South Lotts Road in the South Docks area of Dublin 4. The subject property is fully let to a single tenant at a rent of €245k p.a. until January 2025. The property comprises a 6,310 sq. ft three-storey office block with eight secure surface car-parking spaces, on a prominent corner site of 0.19 acres. The subject site is zoned “Z1 – Sustainable Residential Neighbourhoods”. McCrossan O’Rourke Manning Architects have carried out a feasibility study on the site (subject to planning permission) proposing the development of a six-storey, predominantly residential scheme, with retail and commercial at ground-floor level. The proposed scheme comprises 28 apartments together with 3,305 sq. ft of ground floor retail / commercial space. The Irish Times, 19th April

BNP Dublin Office Market Dublin’s office market is “definitively” in the downturn of the current cycle, with vacancy rates heading to 15% and rents under pressure but John McCartney, director of research at BNP Real Estate Ireland said there’s “nothing sinister” in the current position, with a relatively small amount of new office space due to come on stream between 2024 and 2025. A report from BNP said that hybrid working and stalling employment growth in the tech sector contributed to what it described as a “slump” in office lettings in the capital during the first three months of the year. Take-up in the first quarter was just 285,244 sq. ft. While the number of deals rose year-on-year, there was a 44% slide in the average deal size. Average rents fell 5.6% in nominal terms year-on-year during the quarter, but with inflation running at 7.7% in the period the real decline has been much more severe. The average lease term has reduced from 13.44 years in Q4 2018 to just under seven years in Q1 2023. The Irish Independent, 20th April

Eastgate Business Park, Cork Casey & Kingston are guiding €2.5m for Unit 2 EastGate Business Park. The 18,000 sq. ft office block is let to Capita, on a nine-year lease from April 2015 at €236k p.a. with 65 car parking spaces. Capita also has Cork offices at the Cork Airport Business Park and is set to vacate this EastGate base. According to the agent “the tenant has indicated that they will not renew on the entire premises and would be interested in an early hand-back.” The Irish Examiner, 20th April



Grand Canal Dock, Dublin Colliers is guiding €18.25m (5.25% NIY) for a portfolio of 28 luxury residential units in Grand Canal Dock in Dublin 2. The portfolio comprises 14 two-bedroom units, 12 three- bedroom units, one one-bedroom unit and one four-bedroom unit. The majority of the units are apartments that have been fully refurbished and accordingly present in excellent condition. The 28 units are spread over a number of developments with 14 units located in Longboat Quay. The portfolio is almost fully let at or just below market rents, with just one unit vacant. 15 of the apartments benefit from secure basement car parking spaces, which are currently vacant and offer an incoming purchaser a real opportunity to drive income growth immediately on acquisition. The Business Post, 22nd April
For lending terms on this asset please contact rossmetcalfe@origincapital.ie

Sandymount, Dublin 4 Finnegan Menton is guiding €10m for Block A, The Willows, Claremont Road Sandymount. The investment comprises 21 large apartments consisting of a mix of three two-bed plus study penthouses (1,440-1,500sq. ft), 15 two-bed apartments (840-1,120sq. ft) and three one-bed apartments (645sq. ft), distributed over four floors with underground car parking and individual lock-up stores. The gross annual income is €601k. Two show apartments are currently vacant for viewing purposes. The Irish Times, 19th April
For lending terms on this asset please contact rossmetcalfe@origincapital.ie

Marker Residences, Grand Canal React News reports that Agent Hooke & MacDonald is running a sale process for the Marker Residences, a high-end apartment complex in the Grand Canal Dock, Dublin 2 owned by IRES Reit. The property comprises 85 luxury two-bedroom apartments laid out over six storeys with two units per core on each floor. Sources suggested bids of around €70m are expected, with interested parties understood to be submitting initial proposals in the coming days. React News, 20th April

Blackrock, Co. Dublin M&G Real Estate has acquired Butter Yard, a social housing development in Dublin, Ireland, for €31.3m. The acquisition was made on behalf of the M&G European Secured Property Income Fund, increasing its exposure to the residential sector. Butter Yard comprises 67 one-bedroom and two-bedroom homes across two apartment blocks, offering a total leasable space of 42,068 sq. ft. The property is leased to Dun Laoghaire-Rathdown County Council for social housing use for a term of 25 years, generating long-dated and inflation-linked cash flows for the fund. React News, 20th April

Sandyford, Dublin 18 The Comer Group is progressing with the development of up to 530 apartments in Sandyford. In the coming months it will start building work on 428 of these at the Rockbrook site which Comer purchased from Ires Reit recently. That site is connected underground to the adjoining Sentinel office shell structure, which has been unfinished for over 15 years. Recently Dun Laoghaire-Rathdown County Council rezoned the Sentinel structure from offices to residential and the Comer Group is currently in pre-planning discussions with the council about providing the 102 apartments on the Sentinel site. The site faces the entrance to Beacon South Quarter and is located on the Carmanhall Road, an area which Dun Laoghaire-Rathdown County Council has designated for the Sandyford Business District’s main residential area. The Business Post, 21st April

An Bord Pleanala A “legal problem” encountered by ABP has placed the planning permissions of up to 27,000 homes, already delayed, in jeopardy. The agency has admitted that it may have no option but to refuse permissions on large housing developments which have already been delayed in the planning system for nearly a year. Oonagh Buckley, the interim chairperson of ABP, has said due to the changes in recent development plans published by local authorities, there is “a legal problem as to whether we’re going to be able to grant” permission for up to 77 large housing projects. She said due to planning law, there is no scope for developers to tweak their applications to make them compliant with changes to development plans. As a result, An Bord Pleanála will be forced to outright refuse permission. The legal issue will force many developers, already waiting on planning applications to be approved for up to 12 months, to reapply and face further delays. The Business Post, 22nd April



Climate Proof Construction Future buildings in Ireland will owe their design to meteorologists as much as architects and engineers after a ground-breaking collaboration between construction and weather experts. Met Éireann has produced a series of reports based on past weather patterns and climate change models to warn builders about what kind of extreme conditions their structures will have to endure depending on where in the country they are located. The reports map a wide range of changing weather conditions in different parts of the country that pose particular challenges for climate-proofing buildings. They include temperature extremes, snow loads, rainfall and soil temperature. The reports are publicly available from today for use by construction companies or any other interested parties. The Department of Housing’s Building Standards Advisory Unit has undertaken to incorporate them into national building regulations. The Irish Independent, 20th April

JLL Q1 2023 Report Return on direct investment in Irish property declined for the third consecutive quarter. The latest JLL Irish Property Index, which tracked the property investment market in Q1 2023, has shown that overall returns decreased by 3%. The rate of decline is beyond the levels recorded in 2011, when the index decreased by 1.9% due to the impact of the global financial crisis on the Irish economy. The report showed annual returns over the 12-month period were down by 4.8% which marked “the first quarter to record a decline across a 12-month period since Q1 2012”. It added that capital values declined 4.3% QoQ and decreased 9.7% YoY. “Capital values fell across all four sectors from the previous quarter, with office assets falling the furthest with a decline of 6.4% QoQ and 13.5% YoY.” Further data analysed by JLL showed that rental values across the portfolio were up by 0.5% quarterly and up 2.4% YoY. “This is the fifth consecutive quarter where rental values grew, with quarterly average growth of 0.9% for this period.” The Business Post, 25th April


If you have an article which you would like to have considered for inclusion in our next weekly report, please contact us at info@origincapital.ie

Origin Capital funds senior debt transactions in the CRE investment sector, typically in excess of €3m, and has lent over €200m to clients since April 2015.

Origin Capital is a wholly owned subsidiary of LeBruin, a leading provider of corporate finance solutions.

If you would like to discuss how Origin Capital can help with your funding requirements, please contact us on 01 662 9264.