27th September (Issue 65)

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.




Permanent TSB (PTSB) Deleveraging: PTSB has completed the final phase of its c. €2.8bn deleveraging programme by selling c. €300m of loans which were secured by Irish commercial real estate assets. The loans involved a number of borrowers and have been sold to a number of specialist funds. The three other main components of the deleveraging saw the sale of the Munster and Leinster portfolios (c. €1.5bn par) in March 2015, the Connacht portfolio (c. €481m par) in July 2015 and the Springboard mortgage book (c. €468m par) in October 2014. The Irish Times, 26th September



Navan Town Centre: Joint selling agents Cushman & Wakefield and Savills are guiding €62m for Duignan & McCarthy’s 66% stake in Navan Town Centre in Co. Meath. Their share in the c. 250,000 sq. ft. shopping centre generates net operating income of c. €4.7m p.a., with the single largest rental contribution of €1.2m coming from two multi-storey car parks. Marks & Spencer pay a rent of €478k p.a. to occupy a c. 24,000 sq. ft. unit, which Duignan & McCarthy own entirely. The shopping centre was opened in 1980 and has been expanded at least six times to meet tenant demand. The remaining stake in the shopping centre is owned by Irish Life. The Irish Times, 21st September

Fairgreen Retail Complex: Offers of c. €11.5m are being sought by Savills and Cushman & Wakefield for the Fairgreen retail complex in Mullingar, Co. Westmeath. Fairgreen has eight units which have a total floor area of c. 105,000 sq. ft. One unit is vacant however this is expected to be shortly leased to a UK multiple. The current net operating income of c. €920k p.a. comes from tenants such as New Look, TK Maxx and Dorothy Perkins. Fairgreen dates to 2005 and is currently owned by Duignan & McCarthy. Loans secured by the complex were acquired by CarVal after the property crash. The Irish Times, 21st September

Redmond Square Shopping Centre: Offers of €2.25m are being sought by Cushman & Wakefield and Fenelon Properties for Redmond Square Shopping Centre in Wexford Town. The selling agents are acting on behalf of Grant Thornton, who were appointed as receivers over the management company. There are 14 retail units in the shopping centre, 10 of which are occupied. The current rental income is c. €214k p.a., offering a net initial yield of 9.09%. Included in the sale is a 10,969 sq. ft. vacant cinema and a 269-space car park. The Irish Times, 21st September

Centra Overhaul: 150 Centra stores are to be given an overhaul in the next two years, at a cost of c. €24m. The revamp is designed to focus on the new ‘healthy eating’ trend, and the stores will include free wifi, an upgraded deli and coffee offering and a healthier bakery section. The independent retailers will cover the cost of having their stores upgraded. In addition to upgrading the stores, c. €3m will be spent on a marketing campaign, with the costs to be split between Centra and the independent retailers. There are over 460 Centra stores in Ireland. The Irish Independent, 25th September



Waterloo Exchange: The Nasdaq-listed Jazz Pharmaceuticals is to lease c. 44,000 sq. ft. of the newly refurbished Waterloo Exchange on Upper Baggot Street, Dublin 4. Jazz will pay c. €48 psf under the terms of the lease, which is slightly below the rent sought of €49.50 psf. Jazz will also lease 90 car spaces at €3.5k per space p.a. The OPW are also in situ in Waterloo Exchange, occupying c. 11,000 sq. ft. on the ground floor under a lease which expires in 2022. Davy Real Estate acquired the c. 75,000 sq. ft. Waterloo Exchange in 2012 for c. €22.5m. The Irish Times, 21st September

The Exchange: Joint agents Savills and JLL are seeking tenants for the office space of The Exchange, a new grade-A, 105,000 sq. ft. office block being constructed in Dublin’s IFSC. Rents of €52.50 psf are being sought for the six-storey block, which is expected to be completed by October 2017. The Cosgrave Property Group is developing the block, with IPUT providing the c. €60m of funding required. IPUT will own the block upon completion. The block will also include 37 car spaces, 133 bicycle spaces and a coffee shop. The Irish Times, 22nd September

1 Cumberland Place: Hibernia has completed the c. €29m refurbishment of Cumberland House in Dublin 2 ahead of schedule. Hibernia acquired the property for c. €51m in March 2015 and had previously been targeting Q4 2016 as the completion date for the refurbishment. The c. 135,000 sq. ft. property has been let in its entirety to Twitter and Mobile Travel Technologies Ltd, with Twitter’s lease having already commenced. The property will generate rental income of c. €7.1m p.a. once rent free periods have expired. Hibernia has also renamed the property 1 Cumberland Place.  Property Magazine International, 21st September



Ormond Quay Site: The Irish Times reports that over 100 expressions of interest have been lodged with CBRE for the Zanzibar hotel development on Ormond Quay in Dublin city centre. Offers in excess of €5m are being sought for the 0.42-acre site, which has planning permission for an 89-bed hotel. It is understood that some potential bidders are looking at alternative uses for the site, such as a hostel or student accommodation. The Irish Times, 25th September

Lynam’s Hotel: CBRE is guiding €4m for Lynam’s Hotel on Upper O’Connell Street in Dublin city centre. The 42-bed hotel has been closed for the past two months, after a High Court case was undertaken to obtain vacant possession. A Spar shop located to the front of the hotel does not form part of the sale, as it is owned separately. The hotel is being sold by Aiden Murphy of Crowe Horwath, who was appointed by NAMA. The Irish Times, 21st September



IRES Sandyford: Dun Laoghaire-Rathdown County Council has declared IRES’s application for c. 500 apartments in Sandyford, south Dublin, as invalid on the basis that there is insufficient detail in the application. One of the areas highlighted was the architect’s drawings submitted by IRES, which lacked the level of detail required by local planners. IRES is expected to submit a revised application in the near future.  The Sunday Business Post, 25th September

CSO Property Price Index: The CSO has released the July 2016 Residential Property Price Index, which is now based on stamp duty returns as opposed to mortgage data. The revised index is designed to give a more complete view of market activity. Under the new measures, the peak-to-trough decline (reached in March 2013) of Irish residential properties was 54.4%, as opposed to the decline of 50.9% measured using the old index. Based on the new measure, prices have since risen by 43.2% to July 2016, which is greater than the 37.4% recovery derived from the old measure. Using the new measures, national prices increased by 6.7% for the Y/E July 2016, with prices in Dublin increasing by 3.8%. The new measures also show that first time buyers had just a 24.4% share of the market in 2015, down from 53.1% in 2010. CSO Residential Property Price Index, June 2016

Residential Portfolio: Cushman & Wakefield is inviting offers of over €35m for a portfolio of 458 residential development sites and 66 completed units in the greater Dublin area. The 10 development sites have a total area of c. 60 acres and a guide price of €25m. The most substantial site is a 6.75-acre site on Swords Road, Drumcondra, which has planning permission for 358 apartments. The site has a guide price of €12m – €13m. The 66 completed units consist of 61 apartments and 5 houses and have a current rent roll of c. €746k p.a. The completed units are based in Dublin 11, Dublin 13 and Celbridge, Co. Kildare. The Irish Times, 21st September

Docklands Site: A development company set up by Irish and UK investors has agreed to pay over €20m for a 2.38-acre site in the north Dublin docklands which has planning permission for 935 student accommodation beds. The site is located alongside the Point Village and will see the beds built in two seven-storey blocks. The first block will contain 589 beds while the second will have 346 beds and 9,322 sq. ft. of retail floor space. The site was sold by Declan McDonald of the receiver PWC, on behalf of Wintertide Ltd, NAMA and CIE. The Irish Times, 21st September

Herbert Place: An unnamed investor has paid over €2.5m for two mid-terrace Georgian properties at 14 / 15 Herbert Place in Dublin 2. The properties are generating rental income of c. €150k p.a., offering a net initial yield of c. 5.7%. No. 14 consists of three apartments while No. 15 has office space on the upper floor. There is also a crèche at garden level and a mews to the rear of the properties, which were included in the sale. The Irish Times, 21st September

Watermill Road Site: CBRE is guiding €2m for a site owned by the Churchtown Trust on Watermill Road, Dublin 5. The Bettyglen site currently accommodates a two-storey, 5,167 sq. ft. property, however the site is understood to be capable of facilitating a 14 / 15 house development or a duplex apartment scheme. The Irish Times, 21st September

Sandyford House: CBRE has set a price tag of €2m on Sandyford House, a pub with development potential in Sandyford, south Dublin. The pub has a floor area of 13,240 sq. ft. and is situated on a 1.17-acre site. There is also a vacant retail unit on site. In addition to publicans, John Ryan of CBRE is expecting interest from residential developers, nursing home operators and petrol station operators, given the sites zoning and location. The Sunday Business Post, 25th September

August Mortgage Approvals: Figures from the latest Banking & Payments Federation Ireland (BPFI) report show that the value of mortgages approved for the three months ending August 2016, based on moving averages, was c. €682m. The number of mortgages approved was 3,411. These figures represent increases of 37.2% and 25.7% YoY. BPFI Mortgage Approvals August 2016



Eir Sites: BNP Paribas Real Estate has been retained by Eir to sell two sites in Clondalkin and Sandyford in Dublin. The Clondalkin site is guiding over €5.4m, extends to 35.45-acres and has planning permission for a 30MW data centre. The site also includes c. 22,950 sq. ft. of office space and an adjoining warehouse which extends to c. 39,525 sq. ft. The Sandyford site is guiding €3.75m, extends to 3.74-acres and has rental income of c. €214k p.a. The Irish Times, 21st September



Portobello Portfolio: The MKN Property Group has paid over €10m to acquire two properties and two redevelopment sites located alongside Portobello Harbour in Dublin 8. The first property is Portobello House, which is currently in educational use and has a 0.21-acre site to the rear. This site previously had planning permission for c. 20,000 sq. ft. of retail and office space. The second property is Harbour House, which has a floor area of 26,650 sq. ft. There is an adjoining site to Harbour House which has planning permission for a 41,750 sq. ft. medical centre, however MKN is not expected to proceed with this plan. The Irish Times, 21st September

Blackrock Clinic: The Sunday Business Post reports that some of the shareholders in Dublin’s Blackrock Clinic are preparing a bid for Jimmy Sheehan’s 16% stake in the hospital. Earlier this month, Sheehan informed the board that he was planning to sell his stake to Larry Goodman for c. €16m. Joseph Sheehan and John Flynn are the shareholders who may launch a subsequent bid for Jimmy Sheehan’s shares, as they have the option to do so since they are existing shareholders in the hospital. The Sunday Business Post, 25th September

Cúram Centre: The Minister for Jobs, Enterprise and Innovation Mary Mitchell O’Connor has opened the Cúram centre in NUI Galway. The c. €68m medical research centre is a joint project between Irish universities and established medtech corporations such as Stryker Instruments and Boston Scientific. The centre will accommodate 280 research professionals. According to Ms O’Connor, the medtech sector employs over 29,000 people in Ireland. The Irish Times, 26th September

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.