26th January (Issue 281)
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.
INDUSTRIAL
Clondalkin, Dublin 22 Quinn Agnew has launched Font House, Unit 19 Fonthill Business Park, a detached twin bay building with three storey offices at the front seeking a rent of €515k p.a. (€9.75 psf). Fonthill Business Park is one of Dublin’s premier business parks with occupiers including DID Electrical, Glanbia, Musgrave and An Post. The unit extends to 52.9k sq.ft, 34.4k sq.ft of which is warehouse space, while the offices extend to 15.4k sq.ft with an additional 3.2k sq.ft mezzanine. Given the shortage of ready to go industrial units available it is expected that there will be a lot of interest in this letting. The Business Post, 24th January
RESIDENTIAL / LAND
Greystones Apartments, Wicklow It is reported that Glenveagh are set to receive €60m from the sale of 100 apartments (€600k per unit) at its Marina Village scheme in Greystones, Co. Wicklow to German investor Realis. This will be Realis’s third trade in Ireland and its second with Glenveagh. Realis also paid €46m for 56 apartments on the South Docks (€821k per unit) and €55m to Glenveagh for 87 apartments (€632k per unit) at its Harbour Hill development in Dundrum. The Irish Times, 20th January
Rochestown Site, Cork A residential site in Cork’s Rochestown has been purchased for €4.75m which was 20% over the guide price. The site was purchased by Aperee which is part of the Blackbee Healthcare Fund. The site is a greenfield site of 7.2 acres (c.€650k per acre), with an existing 2,500sq.ft 1970s dwelling on a section, on Clarkes Hill. It is a dense residential location with sources saying that competition came from the nursing home sector and not as expected from house builders. It is likely Aperee will have surplus land once the new purpose-built facility is delivered and may opt to use it for retirement/care homes. The Irish Examiner, 21st January
Rush Site, Co. Dublin A 3.2 acre site with full planning for 40x 3 & 4 bedroom houses has sold in a BidX1 auction for €1.75m (€43.75k per site). The property had been guiding €1.7m and it is understood that it was acquired by an Irish developer. BidX1 revealed that they received several bids prior to the auction date of December 9th. The site is located 1.5km from Rush town centre and will consist of 36x 3-bedroom units and 4x 4-bedroom units. The Irish Times, 20th January
Greystones Site, Wicklow Cairn Homes have sold a 11.5-acre site to the Department of Education. The site is located adjacent to Cairn’s Glenhoran development and the sale is subject to receipt of planning permission for a secondary school which will be built by Cairn. The new secondary school will have up to 50 classrooms and be able to accommodate up to 1,000 students. TheIrish Independent, 25th January
Donnybrook, Dublin 4 Shane Whelan’s Westridge Real Estate has secured planning for a new co-living development on the site of Kiely’s in Donnybrook. The development will see the demolishment of the former pub and replaced with a six-storey shared living scheme comprising 91 units. Westridge were able to proceed with the shared living application as it was submitted before the December 22nd ban on shared living schemes the Government has introduced. The scheme will also include a café and restaurant at ground level. The Irish Times, 19th January
U + I, Dublin Housing U + I, the UK based property firm has said it remains committed to the Dublin market and will continue to concentrate on their residential projects in Dublin. The Independent reported that they have exited their joint venture with Colony Capital which included 4 Dublin properties. The Dublin properties included the Hive in Sandyford, 2 buildings in Ballsbridge and Donnybrook House. In 2018 U+I paid about €7m for the White Heather industrial estate, which fronts on to the Grand Canal and the South Circular Road. The 2.84 acre estate was subsequently rezoned for residential use unlocking a potential windfall thanks to its canal side frontage close to the city centre. The Irish Independent, 21st January
Residential Property Transactions The number of residential property transactions declined sharply last year as the Covid-19 pandemic hit the Irish economy and society, but house prices nonetheless held firm across the State, according to a new GeoView Residential Buildings Report, published by GeoDirectory and EY-DKM. The report highlights that in the 12 months to November 2020 a total of 35,542 residential property transactions took place across the State. That represented a drop of 21.1% compared with the previous year. A decline in purchasing activity was recorded in every county, with Dublin experiencing the sharpest drop in absolute terms, down 3,981 transactions year on year. The average residential property price in the 12 months to November was €294,184, representing a decline of 0.7% year on year. When Dublin is removed from the national average, the average residential property price was €231,549. The Irish Times, 26th January
Dublin City Apartments The Irish Times reported that the cost of building apartments in Dublin ranges from €359,000 for a low-rise unit in the suburbs to as much as €619,000 for a high-rise unit in the city centre, according to a report from the Society of Chartered Surveyors Ireland (SCSI). The report is based on 49 developments which took place in Dublin last year and stated that bricks and mortar accounted for less then half (47%) of total costs to build an apartment. Soft construction costs, land, development levies, professional fees, VAT, developers margins accounted for the remainder. The Irish Times, 26th January
OFFICE
RGRE, Colony Capital The Irish Times reported that Johnny Ronan’s Ronan Group Real Estate (RGRE) and Colony Capital have agreed to a sale of a majority interest in the European headquarter offices that they are developing for Facebook and Salesforce to an international investor for in excess of €1bn. The unidentified purchaser is said to be a new entrant to the Irish market. The sale was led by Eastdil Secured in which they offered potential purchasers to enter a joint venture opportunity on the two developments. The Irish Times, 25th January
Upper Baggot St, Dublin 4 ACG Aircraft Leasing Ireland Limited, the Dublin based subsidiary of Aviation Capital Group LLC, has agreed to rent the top two floors of the Lumen building on Upper Baggot Street. The building is owned by Burlington Real Estate and it is reported that ACG will occupy the fifth and sixth floor which is a combined 2,500 sq.ft of space. The lease is for 15 years with a break after 10 years with the rent to be €50 psf. The letting was managed by Savills and Farley Property on behalf of Burlington Real Estate. The Irish Times, 20th January
Dublin Office Market Estimates for take-up of office space in the Dublin market last year ranged between 1.72m sq.ft and 1.8m sq.ft of which only 306k sq.ft was signed in the final quarter of 2020 as further lockdowns and work from home continued. 50% of those transactions were to Irish firms. Agents Cushman & Wakefield say that the latter figure represents a decline of 30% on 2019 levels. By year end availability of office space increased by 36% to 11.7%, or 8.6% in the Central Business District. At the beginning of 2021, there was almost 4.2m sq.ft of space under construction, of that 54% is pre-let. The Irish Independent, 21st January
OTHER
Dublin 9 Student Accommodation QRE have launched “Woodville” a purpose-built student accommodation development located on Botanic Avenue which is within a five-minute walk to DCU. The investment which has a guide price of €1.5m comprises of 28 bed spaces and offers an investor a gross yield of 8% and a reversionary yield of up to 12.66%. The scheme is being offered for sale with vacant possession of one apartment and the house (10 bed spaces). The annualised current gross rent equates to €120,000 and the agent estimates that gross rental income is about €190,000 when fully let for the year. The Irish Times, 20th January
BNP 2020 Irish Investment Market BNP reported that there was €3.05bn of transaction activity that took place in 2020 with only €83.3m taking place outside of the Greater Dublin Area. Three sectors (Residential 42%, Office 39% & Industrial 9%) account for 90% of all transactions. BNP state that transactions were not as severely impacted by Covid as originally thought and that investors generally expect commercial real estate in Ireland to bounce back strongly. Investors still see there is value in the Irish market in comparison to other European cities. BNP 2020 Irish Investment Market
Goodbody Outlook Report Goodbody’s are predicting that the current lockdown will lead to a fall in domestic demand in Q1 but the acceleration of the vaccine roll out increases the prospect of a rebound in spending this year and into 2022. Domestic demand is forecasted to grow by 5% in 2021 and 3.5% in 2022, largely due to the expenditure of the €13bn which has built up in savings over the last 12 months. Goodbody’s also noted that the housing market has been surprisingly resilient with prices remaining stable and there being a strong housing demand. Goodbody’s also stated that there were 19.5k units completed in 2020 which was down 8% from the previous year but better then what was expected given what happened in 2020. They have forecasted 21k units to be completed in 2021. They expect house prices to grow by 4% in 2021. Goodbody, Q1 2021 Health Check
Ulster Bank Loan Sale Ulster Bank is seeking out interest from other mainstream mortgage providers for a €15bn low risk home loans book as part of a strategic review being led by Nat West. Initial discussions have been held with AIB, Bank of Ireland and other Irish lenders. Ulster Bank are using the exercise to determine what they would be prepared to pay for a mortgage book with a low risk profile. It is reported that Nat West are being advised by Goldman Sachs. Acquiring a clean book would be highly attractive for AIB or Bank of Ireland because Covid will make it very hard for them to hit their lending targets. The Sunday Times, 24th January
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