25th August (Issue 9)

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.



PWC Report:
The latest report by PWC on European loan sales shows that on a par value basis, Ireland had the fourth highest amount of loan sales transacted in H1 2015. With €7.5bn of loan sales, Ireland was fourth behind Germany (€18bn), the UK (€13.5bn) and Italy (€8bn). The report also states that there is currently €11bn worth of loan sales in progress in Ireland. The €18.5bn of loan sales which PWC are forecasting for Ireland in 2015 would represent a c. 40% drop on the 2014 figure of €30.5bn. The Irish Times, 20th July


Windmill Lane:
A joint venture between Hibernia REIT and Starwood is to develop 120,000 sq. ft. of office space, 15 residential units and 7,000 sq. ft. of retail space at Windmill Lane, Dublin 2. Hibernia purchased the site from Starwood for €7.5m in June 2014. However as part of the terms of the transaction, Starwood retained an option to purchase 50% on a joint venture basis, for which they will now pay Hibernia €4.9m. The €4.9m figure is based on 50% of the purchase price, a return of c. 7% per annum and a sum to cover the costs incurred to date by Hibernia. Hibernia expect the development to be completed by 2017. The Irish Times, 24th August

Project Wave:
Planning permission has been sought for the initial development phase of a c. 5.4 acre site on North Wall Quay within Dublin’s Strategic Development Zone. Project Wave is capable of facilitating over 538,000 sq. ft. of commercial space and in excess of 250 apartments. While NAMA own the site, in December 2014 they appointed Oxley Holdings and Ballymore Properties to develop the site. Oxley and Ballymore will acquire a long leasehold interest in the site with NAMA retaining the freehold interest, assuring the state-owned agency of a secure income stream and a percentage of any sales proceeds. The Irish Times, 19th August


Grafton Capital Hotel:
Having purchased the Grafton Capital Hotel earlier this year for €12m, Eamon Waters is believed to be planning a refurbishment of the premises. Waters is expected to increase the number of beds from 74 to more than 90, with plans also to replace the Break for the Border pub with a café and courtyard. Waters purchased the hotel from Liam O’Dwyer and Julie Gilhooly. The Sunday Times, 23rd August

Hotel Ibis Dublin:
Hetherley Capital Partners has purchased the three star, 150 bed Hotel Ibis Dublin on the Naas Road, Dublin 22, for a figure believed to be in excess of €5m. The transaction was completed under a sale and franchise agreement, with the hotel immediately franchised back to AccorHotels, the existing operator of the hotel. The hotel, which was built in the mid-1990s, was subject to extensive refurbishment works in 2007 / 2008. The Irish Times, 19th August


IBRC Shopping Centre:
The sale of the Whitgift Centre in London for £80m has crystallised a c. £80m loss for the taxpayer. 132 Anglo customers had been investors in the shopping centre, which had been recently valued at £120m by Cushman & Wakefield. However the liquidators of IBRC decided to progress with the sale at £80m after a second valuation of less than £80m was received. Other third party interests in the centre had complicated the sales process, with Croydon Borough Council having initiated a potential compulsory purchase order, whereby they would have seized control of the asset. The Sunday Business Post, 23rd August

Developer Noel Smyth’s Fitzwilliam Finance Partners is clear to complete the outright purchase of Arnotts department store after the Competition and Consumer Protection Commission approved the transaction. With Fitzwilliam Finance Partners and Apollo both owning a 50% stake in Arnotts, each sought to acquire the other’s interest this year. A deal was struck eventually when Fitzwilliam reached an agreement with Apollo to purchase their 50% stake. Arnotts accrued nearly €400m of debts in the build up to the recession by purchasing property adjacent to the store. RTE, 21st August

Allsop Auction:
Allsop are to hold their largest commercial property auction in September when 278 assets with a combined reserve of €60m are to go up for sale. One of the most attractive lots is a Georgian building on 10 Harcourt Street which includes two warehouses to the rear, for which the reserve range is €2.9m – €3.1m. The auction boasts a large number of retail investments for which the tenants include Ladbrokes, Boylesports, O’Briens and Dealz. The Irish Times, 19th August


Housing Measures:
Limits on rent increases, tax breaks for landlords, easing of development levies and state assistance for developers are expected to be amongst a range of measures approved by government next month in an attempt to ease the pressure on the housing market. Rent increases within tenancy are to be limited to the rate of inflation, with the market rate of rent applying to new tenancies. Any changes to legislation are likely to be for a fixed term, with the end of 2019 a probable expiration date. The Sunday Business Post, 23rd August

Cork Site:
Bridgedale Homes are believed to have paid c. €3m for a six acre site in Blackrock, Co. Cork. The site, which has planning permission for 18 detached homes of 2,400, 2,800 and 3,400 sq. ft., attracted the interest of a number of developers from Munster and Leinster. The site was previously purchased by Howard Holdings in 2006 for €10.7m. The sale of the site was handled by DTZ on behalf of the receiver, KPMG. The Irish Examiner, 20th August


NAMA London Building:
In 2010, developer Gerry Barrett’s Edward Holdings sold Bow Street Magistrates’ Court in Covent Garden, London to Austrians Rudolf and Christian Ploberger. The property was sold for £25m to reduce his NAMA exposure. The Plobergers have now put the property back on the market, however the guide price has increased three-fold to £75m. A portion of the increase in value can be attributed to the approval of planning permission to convert the property into a five star hotel and museum. The Sunday Business Post, 23rd August

Google Data Centre:
Google have confirmed that they are to develop a second data centre in west Dublin, at a cost of €150m. The data centre, expected to be in excess of 300,000 sq. ft., is to be located alongside their existing data centre at Profile Park near Grangecastle, west Dublin. Approximately 400 jobs will be created during the development of the data centre with several dozen permanent positions being generated once the data centre opens. Ireland is an attractive location for data centres as its cool climate allows operators to save money on energy costs. RTE, 21st August


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 the €3m – €15m range. If you would like to discuss how Origin Capital can help with your funding requirements, please contact us on 01 662 9264.

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