25th October (Issue 69)

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 Gem: Apollo, Cerberus and Oaktree are all believed to have submitted bids for NAMA’s Project Gem loan portfolio. The loan portfolio has a par value of c. €3bn, however the bids are expected to reflect a substantial discount on the value of the loans. The loan portfolio primarily consists of commercial mortgage loans and is secured by 392 properties, the majority of which are in Ireland. The Irish Independent, 20th October



Grafton Collection: The Irish Independent reports that Hines is negotiating Heads of Terms to acquire the Grafton Collection, a portfolio of Grafton Street properties which includes the landmark Hickey’s Pharmacy premises. The portfolio had been guiding €40m, however Hines is believed to be paying a sum in excess of €55m. The current rental income of c. €1.95m p.a. offers a net initial yield of c. 4.62% on the €40m guide price and a yield of c. 3.2% based on the proposed purchase price of over €55m. The Irish Independent, 23rd October

Killarney Outlet Centre: Bids of €11.5m are being sought by CBRE for the Killarney Outlet Centre in Killarney, Co. Kerry. The shopping centre produces rental income of c. €1m p.a. and boasts Nike as the anchor tenant, who pay c. €110k p.a. for a 7,297 sq. ft. factory outlet. The total retail area is 90,497 sq. ft., spread across 39 units. The current owner of the outlet centre is Green Property, who has operated it for the past 18 years. The Irish Times, 19th October

Dún Laoghaire Pavilion: JLL is seeking €9.6m for ten retail units which adjoin the Pavilion Theatre in Dún Laoghaire, south Dublin. The ten retail units are currently generating rental income of c. €758k p.a., however this will rise to c. €905k once the legals have been completed for two new leases. The total floor area is 51,280 sq. ft. and the tenants include Eddie Rocket’s, Eason and Costa Coffee. The Irish Times, 19th October

Charlesland Neighbourhood Centre: Bannon is inviting offers of €4.9m for the Charlesland Neighbourhood Centre in Greystones, Co. Wicklow. The 40,000 sq. ft. centre is producing rental income of c. €510k p.a., with almost half of the rental income coming from SuperValu. As well as the anchor retail unit, there are also eight smaller retail units, a vacant c. 15,000 sq. ft. pub / leisure block and c. 250 car spaces. The Irish Times, 19th October

2016 Shopping Centre Sales: Following a year of significant activity, 2016 could be a record year for shopping centre sales. The largest deal pending is the sale of the Liffey Valley Shopping Centre to the German fund Bayerische Versorgungskammer for c. €600m. Should this deal complete, then there will have been over €1.9bn of shopping centre transactions this year, led by the sale of Blanchardstown Town Centre by Green Property to Blackstone for c. €950m. The total amount of shopping centre transactions in 2015 was c. €1bn. The Sunday Business Post, 23rd October



Central Bank HQ: The Irish Independent reports that Hibernia REIT, Johnny Ronan’s Ronan Group Real Estate, Eamonn Duignan and U+I have all submitted bids to acquire the Central Bank’s HQ building on Dame Street. The closing date for bids was the 19th of October and Lisney had been guiding €65m for the property. The property is being sold on a ‘best bids’ basis, therefore there will only be one round of bidding.  The Irish Independent, 20th October

76 Lower Baggot Street: Cushman & Wakefield has been retained by Bord na Móna to find a buyer for their former HQ at 76 Lower Baggot Street in Dublin 2. The five-storey, 40,827 sq. ft. property includes a 60-space basement car park and has a guide price in excess of €37m. The property is fully let and the tenants are Storyful, Fitbit, DMS Investment Services and Sanne Group. The total rent roll is over €2m p.a. and the weighted average unexpired lease term is c. 7 years. The Irish Times, 19th October

One George’s Quay: Offers in excess of €36.5m are being sought by JLL for One George’s Quay, a 44,483 sq. ft. office block in Dublin’s IFSC. The property is let to JP Morgan under a 25-year FRI lease from December 1996 for a rent of c. €1.8m p.a. Hardwick and British Land developed the property in the early 1990s as part of phase one of the IFSC. The Irish Times, 19th October

Joyce’s Court: CBRE is guiding over €15m for two office blocks and four ground floor retail units in Dublin 1. The units, which are located at Blocks A and B of Joyce’s Court on Talbot Street, are producing rental income of c. €867k p.a. The tech firm Smartbox is responsible for c. 66% of this rental income, paying c. €570k p.a. under a 20-year lease from October 2015 (break in year 10). Block A has a floor area of 28,282 sq. ft. and Block B extends to 26,249 sq. ft. The Irish Times, 19th October

117 – 119 Lower Baggot Street: Joint agents Savills and Hooke & MacDonald are guiding €7.35m for an office block at 117 – 119 Lower Baggot Street, Dublin 2. The 13,296 sq. ft. block has a Georgian façade and includes 10 car spaces. The current rental income of the property is c. €385k p.a., from tenants such as Hooke & MacDonald and CBRE. The Irish Times, 19th October

Fitzwilton House: IPUT plc has been granted planning permission by An Bord Pleanála for its proposed redevelopment of Fitzwilton House on Dublin’s Grand Canal. The c. €45m redevelopment project will see the existing 1960’s block demolished and replaced with a new c. 187,000 sq. ft. block, which will range from four to eight storeys in height. The block will include 44 car spaces and 178 bicycle spaces. The project is expected to commence in 2017 and be finished by the middle of 2019. The Irish Times, 24th October

Donnybrook House: Development Securities Properties (DSP) has sought planning permission from Dublin City Council for an additional c. 10,000 sq. ft. of office space on the two-acre Donnybrook House development site. DSP is believed to have paid c. €9m in 2014 / 2015 to acquire the site, as part of an investment programme which saw them spend c. €25m acquiring eight Dublin sites. The site already has planning permission for a “mixed use retail, office, restaurant and basement gym development”. NAMA Wine Lake, 23rd October



Ibis Hotel: Christie & Co is inviting offers of €13.5m for the Ibis Hotel and an adjoining 0.81-acre site near the Red Cow Luas Interchange in west Dublin. The current owner of the 150-bedroom hotel is Cannock Ltd, a UK company. Cannock paid over €5m to acquire the hotel less than two years ago, before investing c. €1.5m in the hotel to upgrade the bedrooms. It is possible that the properties will be sold separately, with the hotel valued at c. €13m and the site valued at c. €0.5m. The Irish Times, 19th October

Dublin Airport Hotel: CG Hotels, the owners of the Radisson Blu hotel in Dublin airport, want planning permission for an additional seven-storey, 144-bedroom standalone hotel on the car park of their existing hotel. CG Hotels previously obtained planning permission for a c. €59m extension to their Radisson Blu hotel, which will see 314 rooms added to the 229-bedroom hotel. The Irish Independent, 21st October

Coombe Hotel: An Bord Pleanála has refused a planning application for the development of a 263-bedroom hotel on a derelict site on the Coombe, near St. Patrick’s Cathedral in Dublin 8. An Bord Pleanála deemed the proposed development of the six-storey over basement hotel to be an overdevelopment of the site, stating that the hotel would be higher than nearly all the other buildings in the area. The application for the development of the c. €40m hotel was submitted by the Hodson Bay group, via a company called Realmside. The Irish Times, 20th October

Occupancy Figures: The latest figures from the hotel data provider STR shows that September 2016 was a record month for Dublin hotels, with an occupancy figure of 93.6% achieved. 2016 has also been a strong year for RevPAR, with RevPAR up by c. 19.4% so far this year. The Irish Independent, 23rd October



Point Campus Site: O’Flynn Capital Partners (OFCP) has paid over €20m to acquire a c. 2.3-acre site in the Dublin docklands which has planning permission for 935 student accommodation beds. To complete the transaction, OFCP obtained funding from Blackrock as well as local senior debt. The total development cost of the site, named Point Campus, is projected at over €100m. In addition to the student accommodation, the site also has planning permission for 9,320 sq. ft. of commercial retail floor space and 4,973 sq. ft. of communal facilities. The Irish Times, 25th October

St Mary’s Carmelite: Joint agents GVA Donal O’Buachalla and WK Nowlan Property are seeking offers in excess of €10m for a 3.09-acre development site located at the former St Mary’s Carmelite seminary on Bloomfield Avenue in Donnybrook, Dublin 4. A feasibility study by John McLaughlin Architects suggests that the site could facilitate the development of 90 apartments and 10 large houses. The Irish Times, 19th October

Hanover Quay Development: Cairn Homes has sought planning permission from Dublin City Council to develop 122 apartments on the former site of Kilsaran Concrete on Hanover Quay in the south Dublin docklands. The 7 – 8 storey development would have a total floor area of c. 200,000 sq. ft. and consist of 24 one-beds, 76 two-beds and 22 three-beds. NAMA Wine Lake, 23rd October

Airbnb: The use of Dublin apartments for Airbnb lettings featured heavily in the news in the past week. The first story involved a landmark ruling by An Bord Pleanála, who upheld a planning decision which states that an apartment in Dublin’s Temple Bar area could not be used for Airbnb lettings without first receiving planning permission, as it reflects a material change of use. The second story revealed that Indigo Property Management has informed the c. 2,000 residents in the Spencer Dock apartment complex in Dublin that they are not allowed to use their apartments for short-term lettings. Indigo issued a letter to each of the residents in the 623 apartments which states that following the receipt of legal advice, the use of apartments for short term lettings is a breach of lease covenants and is also against the Spencer Dock house rules. The Irish Times, 20th Octobe

Development Land Sales: In the first nine months of 2016, there were 75 development land transactions closed in the Republic of Ireland, for a total of c. €640m. According to CBRE, there were c. €770m of land sales completed in the whole of 2015. The largest development land sale in Q3 2016 was the Stocking Portfolio, which included a 24.7-acre residential development site in Rathfarnham, south Dublin. Cushman & Wakefield achieved in excess of the €39m guide price for this portfolio. The Irish Independent, 20th October

Help-To-Buy (HTB) Scheme: Following the introduction of the HTB scheme for first-time buyers (FTBs) in the 2017 Budget, the Government has moved to amend the mortgage threshold which FTBs must meet in order to qualify for the scheme. When the scheme was initially launched at the unveiling of the budget, the mortgage threshold was 80% of the value of the home. After fears were raised that this could lead to FTBs borrowing unnecessarily high levels of debt in order to meet the criteria, this threshold was reduced to 70%. The Irish Times, 21st October



Q3 2016 Review: JLL’s Q3 2016 report on the Dublin industrial market shows that there was a significant increase in take-up in the quarter when compared to Q2 2016. The level of take-up for Q3 2016 was 898,073 sq. ft., versus 494,658 sq. ft. of take-up in Q2 2016. At the end of Q3 2016, the YTD level of take-up was 1,942,464 sq. ft. Prime rents increased by c. 3.3% in the quarter and are now at c. €7.75 psf. Secondary rents have also risen from c. €5 psf to c. €6 psf. Dublin Industrial Market Report Q3 2016, JLL



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