27th October (Issue 18)

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 Arrow: Cerberus have been chosen by NAMA as the preferred bidder for the c. €6.25bn Project Arrow, which consists of 302 debtor connections secured by 1,906 assets. The fund is believed to have bid c. €800m for the loan portfolio, for which 97.5% of the loans are non-performing. The initial par value of the portfolio had been €8.4bn, however this reduced to €6.25bn following asset sales, loan refinancings and loans retained by NAMA. NAMA retained a number of loans secured by development sites as it has been mandated with funding the development of 20,000 residential units by 2020. CoStar Finance, 23rd October

Project Clear: First round bids have been received for Ulster Bank’s Project Clear, with all bids significantly below the €650m guide price. As many as 10 parties are understood to have submitted bids for the portfolio, including Cerberus, Hines and Cairn Homes. The portfolio consists of prime development land in Dublin and Cork. With the portfolio split into three tranches, interested parties can bid for individual tranches or the entire portfolio. Bids for the full portfolio were all believed to have been under €500m. The Sunday Times, 25th October

Project Jewel: Hammerson has been provided with a €1bn revolving credit facility to assist with the purchase of their share in NAMA’s Project Jewel. The €1bn facility reflects an 81% LTV based on Hammerson’s €1.23bn share of the €1.85bn purchase price. The facility was provided by five banks; BNP Paribas, Lloyds, JP Morgan, HSBC and Deutsche Bank. Hammerson intend to refinance the facility via asset disposals and capital markets issuances. In the past week Hammerson issued a GBP£350m bond which pays a coupon of 3.5%. Hammerson then entered into a Euro swap for the nominal amount and coupon payments, resulting in a net coupon cost of 2.5%. Real Estate Capital News, 21st October


One Spencer Dock: NAMA will be expecting significant interest from institutional investors when One Spencer Dock goes on the market in the coming weeks. Joint agents Savills and CBRE have been chosen to sell the property in Dublin’s North Wall Quay, for which the guide price is expected to exceed €240m. The 226,624 sq. ft., nine storey property was developed in 2007 by Treasury Holdings and let to PWC on 25 year leases, with upward only rent reviews every five years. PWC is believed to be paying annual rent in excess of €11m, equivalent to c. €50 psf. The Irish Times, 21st October

Commerzbank House: Hibernia REIT has chosen BNP Paribas Real Estate to act as the letting agent for One Dockland Central (formerly Commerzbank House) in Dublin’s IFSC. The property is currently being refurbished with a completion date of Q1 2016. Upon completion it is expected to rent for a minimum of €45 psf. Hibernia purchased One Dockland Central, along with Guild House for over €90m in July 2014. It is believed that Hibernia’s long term plan is to refurbish both buildings in order to create over 140,000 of lettable, grade A office space. The Irish Times, 21st October


Connacht Hotels: The Hanly Group have chosen Savills to sell two four star castle hotels in Connacht for a combined €8m. Kilronan Castle is an 84 bed hotel on a 40 acre estate with a guide price of €4.5m. Lough Rynn Castle is a 44 bed hotel on a 300 acre lakeside estate which has a guide of €3.5m. The hotels are being offered for sale either on an individual or joint basis and are both trading strongly. The Irish Independent, 22nd October

Windsor House: The co-owners of the Merrion Hotel in Dublin, Hastings, have been granted planning permission to develop the tallest hotel in Ireland. Hastings are to redevelop Windsor House in Bedford Street, Belfast into a luxury 200 bed hotel. The 24 storey building is to also include 16 serviced apartments, office space and ground floor retail units. The total cost of the project is estimated at GBP£30m. Hastings purchased Windsor House from NAMA in May 2015 for £6.5m. The Irish Times, 21st October

Sackville House: Tetrarch Capital have sought planning permission from Dublin City Council to convert Sackville House in Dublin 1 into a budget boutique hotel. Sackville House is currently a c. 27,000 sq. ft., three storey block and the estimated cost of Tetrarch’s project is €16m. Tetrarch purchased the property last year for €4m. Should planning permission be granted, Tetrarch hope to open the hotel before the end of 2017. The Irish Times, 21st October


Cork Development: Savills are seeking offers in excess of €5.75m for a part two-storey property on a 0.8 acre site on Washington Street in Cork City. The property has been occupied by Square Deal Interiors for the last few decades. However the owners have now decided to retire. Potential redevelopment opportunities include residential or educational facilities, with UCC in close proximity. Also close to the site is the former Esso petrol station, which recently sold for €3.5m with planning permission for 50 residential units. The Irish Examiner, 22nd October

Abbey Glen: Knight Frank are guiding €8.5m for 44 apartments in Cabinteely, Dublin 18. The complex consists of 13 one beds, 26 two beds and five three bed apartments. Seven of the units require investment before they would be suitable for letting. The gross annual rental income of the complex at present is c. 441k. With all 44 units finished and occupied, the gross annual rental income is believed to be c. €656k. The current sale price reflects a price of less than €200k per unit and a gross yield of c. 7.38%. The Irish Independent, 22nd October

Barrow Street: Offers in excess of €2m are being sought by Savills for a part two storey warehouse on 0.23 of an acre at 15 Barrow Street, Dublin 4. The property is most likely to be considered a redevelopment opportunity with the warehouse most suited to an open plan office or fitness centre. The property has residential zoning and there is an expired planning permission for eight mews houses and 6,458 sq. ft. of light industrial or general media use. Post completion of the sale, the current owners, Dublin Sanitary Disposal Ltd, are to occupy the property under a short term lease at €100k p.a. The Irish Times, 22nd October


Facebook Data Centre: Facebook have been granted planning permission by An Bord Pleanala for their proposed €200m data centre in Clonee, Co. Meath. Development of the data centre is expected to be completed over two phases. The first phase will see the development of two data centres with a combined gross floor area of c. 538,000 sq. ft. The second phase will see the construction of a third data centre with a gross floor area of 273,000 sq. ft. The Sunday Business Post, 25th October

Property Index: The latest figures from JLL’s property index reflect the continued strong performance in the commercial property market, with overall returns up by 7.7% for the third quarter. The sector has generated a positive return of 25.9% over the past twelve months. Capital values rose by 6.1% for the quarter and 18.1% for the year, with retail values showing the strongest growth in the quarter at 8.6%. Values have now risen by 46.2% since the bottom of the market, however they remain 47.7% below their peak value in 2007. The Irish Times, 21st October

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.