26th September (Issue 416)
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.
MIXED-USE
Middle Abbey Street, Dublin 1 Turley Property Advisors is guiding a price of €3.75m for 94-96 Middle Abbey Street, a four-bay, five-storey-over-basement mixed-use building in Dublin City Centre. The ground floor and basement are currently laid out as retail at ground level and retail/storage at basement level and as apartment accommodation on the upper three floors. The first floor was formerly occupied by a long-established retail jeweller. The six existing apartments comprise one three-bedroom unit and five two-bedroom units. The upper floors of the property are being sold with vacant possession expected by March 2024. The ground floor and basement are let to a strong covenant, the electrical product supplier City Electrical Factors on a 20-year lease from February 2015. The current rental income is €210k pa with asset-management potential to increase that to more than €300k pa. The Irish Times, 20th September
Ballycoolin, Dublin 11 Savills is quoting a combined rent of €1.405m for a large office headquarters and warehouse facility at Huntstown Business Park in Ballycoolin, Dublin 11. The property comprises a detached two-storey office extending to 30,774 sq. ft and a detached warehouse premises of 78,114 sq. ft, providing a total of 108,888 sq. ft of accommodation. The buildings are available to let in one or more lots. The Irish Times, 20th September
OFFICE
Lower Mount Street, Dublin 2 Businessman Laurence Goodman jnr has completed a €30m deal for Nos. 73 – 83 Lower Mount Street. The price paid by Mr. Goodman represents a 20% discount on the €37.5m Savills had been guiding when it brought the building to the market on behalf of Irish property company Iput last February. The €30m sale price equates to a capital value of just under €500 per sq. ft and will provide the purchaser with a 7% return on his investment based on the property’s current rental income. The purchaser will have the guarantee of 100% government income for just under five years to break and eight years to lease expiry as the building is fully let to the Office of Public Works on FRI leases. Existing tenants include the Revenue Commissioners. Currently the property, which has two separate entrances, is split by way of Timberlay and Ballaugh House. The offices are arranged over lower-ground and four upper floors, extending to a total net internal area of 60,207 sq. ft. Iput secured planning permission from An Bord Pleanála in 2021 for the demolition and redevelopment of the property to incorporate a five-storey over-basement office building extending to 117,177 sq. ft (GIA). The Irish Times, 20th September
Sandyford Business District, Dublin 18 Millbank House, which is occupied by two tenants at present, is being offered to the market by Colliers at a guide price of €3.9m (NIY 6.44%). This would equate to a capital value of €170 per sq. ft, which is substantially below the building’s replacement cost. Millbank House comprises a four-storey over-basement office building extending to a gross internal area of 22,848 sq. ft, along with 40 basement car-parking spaces. The building has open-plan floor plates which range in size from 4,000 sq. ft to 5,500 sq. ft. The building is currently occupied by two tenants. Pro Rugby Championship DAC hold a 10-year lease from 2017, expiring in December 2027. The passing rent in this case is €141.48k pa. The second tenant, Mundipharma Pharmaceuticals, hold a 20-year lease expiring in October 2027. The passing rent here is €134.87k pa (with an outstanding rent review from 2022). The Irish Times, 20th September
Dame Street, Dublin 2 WeWork plans to open its new flexible office space in the old Central Bank building on Dame Street in May 2024 – approx. five years after the initial deadline set for the project’s completion. The co-work space provider has confirmed that the fit-out of One Central Plaza has now commenced ahead of opening the 73,000 sq. ft space next year. The announcement comes weeks after WeWork announced that “substantial doubt exists” over the future of the company and revealed plans to engage with many landlords globally to renegotiate its leases. The Business Post, 19th September
Navan, Co Meath Athlumney House, which is better known as the headquarter offices of the Garda Human Resources Directorate, is being offered to the market by Colliers at a guide price of €5.7m (NIY 7%). The building is leased in its entirety to the Office Public Works (OPW) under a single, FRI 20-year lease from 2008 and is subject to an outstanding rent review from October 2022, which is on upwards-only terms. Extending to a gross internal area of 29,500 sq. ft, Athlumney House comprises an original two-storey over-basement period property that interlinks with a modern office extension extending to 20,506 sq. ft over ground and first floor. The property sits on a 4.23-acre site and has 112 car-parking spaces. The Irish Times, 20th September
Fenian Street, Dublin 2 TikTok is set to take over the majority of the Dublin office of X (formerly known as Twitter), having agreed a sublease on the Fenian Street premises for up to five years. The Chinese-owned social media giant has signed heads of terms to take four of the five floors at Cumberland House, and aims to take up occupancy by early 2024, it reported. X has dramatically downsized its office space in the past 12 months, following job cuts imposed by new owner Elon Musk last year. The Irish Times, 24th September
Blackrock, South Co Dublin Aviva Life & Pensions Ireland DAC (Aviva) has secured DunPort Capital Management as the second tenant for its recently refurbished offices at Blackrock Village Centre in the south Dublin suburb of Blackrock. DunPort Capital Management has agreed a deal to occupy the second floor of office accommodation (4,316 sq. ft) on a new 10-year lease. The Irish Times, 20th September
INDUSTRIAL / LOGISTICS
Naas, Co Kildare Microsoft is in the early stages of planning for a new data centre in Naas, Co Kildare. The tech giant, which already has 15 data centres in Ireland, confirmed the move in a statement. The company said it has commenced initial pre-planning consultation with authorities for a site that has been specifically zoned for data centre use by Kildare Co Council in its 2021-2027 Naas local area plan. Microsoft said its preferred solution is to use 100% renewable energy to power the planned facility. The Business Post, 21st September
HOSPITALITY
Booterstown, South Dublin Developers Paddy McKillen jnr and Matt Ryan have secured planning permission from An Bord Pleanála for the development of a luxurious wellness facility, spa and interpretative centre on the lands adjacent to Booterstown Marsh and bird sanctuary in South Dublin. The approved scheme will, upon completion, comprise a five-storey building rising to a height of 61 ft and extending across a total area of 68,114 sq. ft. The Irish Times, 20th September
Ballycurreen, Cork A Cork site is up for sale with planning permission for a 158-bed hotel recently secured on the Kinsale Road at Ballycurreen, between the city and the international airport. The hotel site of 2.15 acres is part of an approx. 7-acre mixed use land parcel at Ballycurreen which also include plans for approx. 130 apartments and duplexes in 12 blocks of three storeys each as well as other neighbourhood uses. The Irish Examiner, 21st September
Portumna, Co Galway The site containing the burned down Shannon Oaks Hotel in Portumna, which is owned by the Comer brothers, has been removed from Galway’s derelict site register. The hotel, which was ravaged by a fire in 2011 and went into liquidation soon after, was acquired by Galway brothers and property developers Luke and Brian Comer in 2016. In January of this year, Galway County Council added the lands to its derelict site register. Owners of sites on the register are required to pay a 7% levy on the value of the property to the local council. A spokeswoman for Galway County Council has now confirmed that the site has been removed from the derelict sites register. She said “works were satisfactorily carried out” on the site, but the owners will still face a levy for 2023, with a demand for payment due to be issued to the Comer brothers soon. The Business Post, 25th September
RESIDENTIAL / DEVELOPMENT
Ballsbridge, Dublin 4 Richmond Homes, the house building arm of real estate investment firm Avestus Capital Partners, is looking to dispose of the former St Mary’s nursing home at Pembroke Park in Ballsbridge, Dublin 4. Having paid in excess of €6m to acquire the property in 2018, Richmond Homes has, since then, secured planning permission for two potential residential schemes on its 0.85-acre site. With approval now in place for the development of either 23 owner-occupier apartments or 64 build-to-rent units, joint agents Cushman & Wakefield and Sherry Fitzgerald Commercial are guiding a price of €7m for the site. The first planning permission was granted to Richmond Homes’ vehicle, the Pembroke Road Partnership, in 2020 for 23 apartments, comprising three one-bedroom apartments, 15 two-bedroom apartments and five three-bedroom apartments over basement car parking for 25 spaces. The second, more recent planning permission meanwhile was granted in May of this year and allows for the development of a basement-free 64 unit BTR scheme, comprising 19 studios, 41 one-bedroom apartments and four two-bedroom apartments. The Irish Times, 20th September
Balgriffin, Dublin 17 Knight Frank is guiding a price of €2.95m for a residential development opportunity at Carr’s Lane in Balgriffin, Dublin 17. The subject site currently comprises a single-storey house with adjoining lands extending to a total of 6.45 acres. The lands are laid out in two divisions separated by a band of trees, with two existing access points off Carr’s Lane which connects to the Malahide Road. The Irish Times, 20th September
Kilkenny Joint agents Cushman & Wakefield and FitzGerald Auctioneers are inviting residential developers to submit expressions of interest to partner with Tesco in the development of the former mart site in Kilkenny city by providing a significant residential element within the site. The brownfield site is located less than 1km north of the city centre and benefits from ample profile onto the Castlecomer Road, New Road and Old Mart Street. Those interested are requested to submit expressions of interest by November 1. The Business Post, 23rd September
Donabate, North Co Dublin A fresh planning application for a housing development of 1,020 residential units, a 32-acre nature park, crèches and links to the Broadmeadow Greenway has been submitted to Fingal County Council. Set to replace the previous SHD application granted by An Bord Pleanála in November 2022, the current proposal represents a significant reduction in the number of apartments in favour of houses with their own back garden. The number of 529 houses proposed in this plan is scheduled to increase by 160 units compared to the original plan. Own-door duplex and triplex units now stand at 356, an increase of four; however, apartments see the greatest change down from 592 units to just 84, a drop of 508 units. The overall plan sees a reduction of over 345 units in total when compared to the original SHD application. The proposed construction period will be over ten years. The site at Corballis, Donabate is being developed by Aledo Donabate, part of the Cannon Kirk Group in conjunction with Lioncor. The Business Post, 22nd September
An Bord Pleanála is now refusing as many homes under fast-track planning rules as it is approving. Since April, when the board was brought up to a full complement of 15 members, it has refused developers permission to build more than 2,200 homes. In that five-month period, the same number were approved. The homes refused permission had applied under the Strategic Housing Development (SHD) scheme, which was created in 2016 to allow developers to bypass local authorities and apply directly to An Bord Pleanála for permission to build large housing projects. An Bord Pleanála has typically approved approx. 80% of SHD cases. The rate of approval has now dropped to 50%. The Irish Times, 24th September
The Irish Property Owners Association (IPOA) has recommended the government introduce a 25% income tax for landlords to help address the housing crisis. In its pre-budget submission, the IPOA has also sought an extension of CGT and a reduction in CAT. The recommendations come ahead of next month’s budget, which has the government divided over tax breaks for landlords. In its submission, the landlord representative group said this recommendation would “encourage the retention of landlords in the residential property market while ensuring adequate availability of stock for rent.” The body is seeking the 25% income tax rate to be inclusive of USC and PRSI charges. The recommendation on CGT was based on property owners committing to retaining rental properties for a minimum of seven years, which it said would ensure stability in the market. The Business Post, 20th September
Residential Rents New renters are paying on average €214 each month more than existing tenants nationwide, according to research by Economic and Social Research Institute. A new study conducted by the institute has found that while the highest difference in rents between new and existing tenancies was in Dublin, at €233 on average, it was the northwest and west of the country which recorded the biggest differences in percentage terms. The percentage difference between new and existing tenants was highest in Waterford on 28.6% and Limerick on 27.4%. Dublin while having the largest euro difference only showed a 13.6% difference in prices. The average rent in Dublin rose to €2,102 in the first quarter of this year, according to the Residential Tenancies Board. The Business Post, 20th September
Harolds’s Cross, Dublin 6 A shovel-ready site in Harold’s Cross, Dublin 6 has been brought to the market. Agent Cushman & Wakefield is guiding over €2m (€100k per unit) for the 0.2-acre site at 146-156 Harold’s Cross Road which currently comprises a terraced block of five mixed-use derelict properties which were previously in residential and commercial use. Last December it was granted planning permission for 20 residential units including 13 one-bed apartments, three two-bed units and four two-bed duplexes. The Irish Independent, 21st September
Rochestown Road, Cork Sherry FitzGerald, jointly with Sherry FitzGerald Reynolds, are guiding the bungalow property called The Orchard near the Fingerpost at €1.75m. It has two sections of frontage, 45m and nine meters, to the Rochestown Road, with a separately owned house also on the road, on the village side of the Rochestown Park Hotel, facing some of the road’s premier private houses behind high stone walls. The joint agents describe it as “the Grade A well-established desirable area of Douglas/Rochestown Road,” and say there’s good access, a range of adjacent services plus a bus stop. The Irish Examiner, 21st September
College Green, Dublin 2 Dublin City Council is considering buying one of the most prominent buildings on Dublin’s College Green, the former Ulster Bank, so it can be converted into social housing. The bank was put on the market in recent weeks with a guide price of €13.5m, as part of the portfolio of sales of the bank’s former branch network following its closure earlier this year. More than 12k homes and commercial properties are vacant across Dublin, with 40% empty for more than four years – putting them at significant risk of dereliction. The Irish Times, 25th September
Monkstown, South Dublin Dún Laoghaire-Rathdown County Council has refused planning permission to US group Greystar for a 488-unit build-to-rent BTR scheme on grounds around Dalguise House on Monkstown Road in South Dublin. Greystar subsidiary GEDV Monkstown Owner Limited’s application was refused after more than 70 objections were lodged against the scheme. The refused scheme comprised 488 new-build units and three two-storey, three-bed terraced units. Ten blocks were to be constructed, with one block reaching nine storeys. The scheme as planned included 288 one-bed units with an estimated average monthly rent of €2.5k, or €30k annually. The Irish Times, 21st September
New Land Tax House buyers could end up paying more for their homes because of the costs incurred by developers seeking to exclude sites from a new land tax, property developer Michael O’Flynn has warned. Mr. O’Flynn, who faces approx. €1m annual tax bill on land he plans to develop off Dublin’s Naas Road, as a result of losing an appeal to An Bord Pleanála, said an “unintended consequence” of the new tax is that it will “add to the cost of housing”. Moreover, when the tax itself – known as the Residential Zoned Land Tax (RZLT) – is aimed specifically at lands which have benefitted from investment in services and are capable of being developed for housing but remain idle. Where lands are taxed, that cost is also likely to be passed on by developers to the end-purchaser. The Irish Examiner, 21st September
OTHER
Dublin Airport An unnamed Saudi investor is in the hunt for strategic lands at Dublin Airport, as bidders press for reassurance about access to the runways and the road network. Vendors led by brothers UIick and Des McEvaddy have told prospective buyers they will take second-round bids in November, delaying a process that had been expected to culminate in early autumn. As talks continue, bidders have urged the vendors to provide comfort about the right to access to the DAA’s runways and roads in North Co Dublin. In the opening phase of the sale, the vendors provided a senior counsel’s opinion on runway access that they commissioned. That paper cited a European case that underlined the right of private landowners to access State infrastructure if it is deemed necessary for the public interest. An updated legal opinion is now said to be in preparation. The Irish Times, 25th September
Francis Street, Dublin 8 Funding of €9m for essential conservation work to halt the structural decline of the Iveagh Markets in Dublin’s Liberties has been approved by the Government. The Edwardian building on Francis Street, which is at the centre of a legal dispute over its ownership, has been vacant for 30 years and has over the last decade declined into a ruinous condition. Dublin City Council has agreed to undertake structural safety works to the building and said it is currently evaluating tenders for a design team to oversee “essential stabilisation works”. The Irish Times, 21st September
EY Survey According to a survey conducted by EY, 75% of real estate companies are actively preparing to raise or refinance debt in the coming year despite facing macroeconomic headwinds. More than half of these firms are keenly eyeing potential buying opportunities in distressed assets within the same timeframe. Domestically, bank debt remains the preferred funding source for the majority, followed closely by international debt funds. Margin considerations hold significant sway, particularly in the context of rising interest rates. A noteworthy 60% of respondents have already implemented sustainability plans, which could potentially translate into improved access to capital and more favourable terms. Effective debt planning is becoming increasingly paramount in the current dynamic environment, where an ever-changing lending landscape and evolving lender expectations require precise alignment for successful finance raising. EY Real Estate Borrowers Outlook Survey 2023, 25th September
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