28th July (Issue 5)

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 Finn:
Deutsche Bank and Apollo have been chosen as the preferred bidder for the largest tranche of Ulster Bank’s non-performing loan portfolio Project Finn, paying c. £400m to purchase loans with a par value of £1.137bn. The tranche consists of CRE loans secured by c. 1,200 properties from 290 borrowers. The second tranche of Project Finn has been sold to Cerberus, who will pay £225m to purchase a residential mortgage pool with a par value of £549m spread amongst 2,000 separate borrowers. The third and smallest tranche which consists of SME loans with a par value of c. €530m is to be purchased by Sankaty Advisors for c. €100 – €120m. CoStar Finance, 23rd July

Project Jewel:
The Abu Dhabi Investment Authority, who this week were selected as the preferred bidder for Project Trinity along with developer Joe O’Reilly, are believed to be lining up a bid for NAMA’s €2.4bn par value Project Jewel portfolio. As Project Jewel consists of loans to O’Reilly’s Chartered Land, the firm are unable to bid for the portfolio, however they are a prime candidate to remain as asset manager given their strong performance in managing the assets in recent years. The Sunday Times, 26th July


Nassau House:
Aviva have appointed JLL to handle the off-market sale of Nassau House, which they are hoping to sell for over €50m. The 100,000 sq. ft. property generates gross rental income of €3.5m p.a. from nine retail units at street level and four floors of offices overhead. The retail units incorporate 30,000 sq. ft. with the tenants including the House of Ireland, Spar and Oasis, while the office tenants include Bank of Ireland, Independent College and the Irish Clearing House.  The Irish Times, 22nd July

Sandyford Redevelopment:
Development Securities has paid €6m for a 1.8 acre redevelopment opportunity in Sandyford, Co. Dublin. A planning application has been submitted for the site to allow for a mixed use development which would accommodate up to 140 residential units and 10,000 sq. ft. of office space. The site currently contains a 42,000 sq. ft. office and warehouse property which is let to Avid Technology International until April 2017, with the new owner citing an initial yield of 12.75%. The Irish Times, 22nd July

Ballsbridge Project:
After being chosen as the preferred bidder for the 3.7 acre site in front of AIB Bankcentre in Ballsbridge, developer Johnny Ronan is believed to be planning a €200m redevelopment which will create 250,000 – 300,000 sq. ft. of office space. Johnny Ronan is to pay c. €67.5m for the site which is being sold by receivers acting on behalf of NAMA and Ulster Bank. The Cardinal Capital Group are thought to have provided Johnny Ronan with the financing for the transaction. The Irish Times, 22nd July


Project Trinity – Jurys Hotel Site Ballsbridge:
A consortium led by Joe O’Reilly’s Chartered Land has been chosen as the preferred bidder for Ulster Bank’s Project Trinity, paying over €170m to purchase the 6.8 acre Ballsbridge hotel sites. Chartered Land is believed to have partnered with the Abu Dhabi Investment Authority to complete the transaction, which will provide the necessary financing. The site was previously acquired by Sean Dunne for €380m in 2005. The Irish Times, 23rd July 

Regional Hotels:
DTZ Sherry Fitzgerald is seeking bids for two regional hotels on an individual basis; Jackson’s Hotel in Ballybofey, Co Donegal and Cedars Hotel in Rosslare, Co. Wexford. Jackson’s Hotel is a four star 138 bed hotel with a guide price of €2.3m and is a 20 minute drive from Donegal Town and Letterkenny, while Cedars Hotel is a three star 34 bed hotel with a guide price of €700k. Cedars recently ceased trading and the receiver PwC has advised that the hotel be sold on a vacant possession basis. The Irish Independent, 26th July

Average Room Rates:
The average room rate for hotels is set to breach the €100 level this year for the first time since the recession, according a new study by BDO. Occupancy levels in Dublin are also expected to increase to over 80%, with the strong performance in the sector attributable to the weaker Euro and the 9% VAT rate. Last week the CSO released figures indicating that the number of tourists for the first six months of 2015 was 3.8m, an increase of almost 400,000 on the same period in 2014. The Sunday Business Post, 26th July


Portmarnock Development:
Ardale Property has submitted a planning application to Finglas County Council to develop a 21,000 sq. ft. retail store on a 0.93 acre site on Strand Road, Portmarnock. The site, which was formerly Tin Church, is located on the corner of Strand Road and St Laurence O’Toole’s Avenue. The scheme has a gross value in excess of €12m and the proposed retail store will create 40 jobs upon completion. The Irish Times, 23rd July


Docklands Development Site:
CBRE are guiding €8m for a redevelopment site of 0.67 acres which is located at the junction of Townsend Street and Moss Street in the south Dublin Docklands. While the site is currently without planning permission, Wesley Rothwell of CBRE believes that the site could accommodate 350 – 400 bed spaces for student accommodation or a six storey office block of over 129,000 sq. ft. The Irish Times, 22nd July

Student Accommodation:
A new study by the Higher Education Authority examining the availability of student accommodation has identified a shortage of 25,000 bed spaces for students, with this gap expected to widen between now and 2024. The study is part of a report being prepared for the Minister of Education which is aimed at identifying a number of incentives that will make student accommodation projects more attractive to developers. The Irish Times, 22nd July

€500m State Fund:
The Ireland Strategic Investment Fund is in advanced talks with a private investment fund over the launch of a new €500m fund designed to provide loans to private housing developers. The fund, which is targeting the construction of up to 10,000 new homes and the creation of hundreds of jobs in the building sector, will provide developers with up to 90% of their financing requirements. The Irish Times, 25th July

O’Flynn Development Project:
Michael O’Flynn is to receive a decision on his planning application to construct 164 new high end houses on a site in Cabinteely, Co. Dublin. The cost of the development is believed to be c. €75m with the properties to sell for up to €1m each. Financing for the scheme is to be provided by the O’Flynn Capital Group, which is backed by private investors. The Irish Independent, 26th July

O’Reilly Development Project:
CTN Developments, who are believed to be linked to developer Joe O’Reilly, have sought planning permission for a 166 unit residential development on Grace Road in Drumcondra, Dublin 9. Oaktree Capital Management is believed to be financing the development. The Irish Independent, 26th July


Danske Bank:
Danske Bank are continuing to reduce their exposure to the Irish market, with less than 1,000 commercial properties left to be sold. At the end of 2014 some 3,746 properties remained on their book, however 2,783 of these properties were sold at the end of June, with a further 405 properties at the sale agreed stage. In addition Danske’s entire SME portfolio was sold in the first half of 2015 and while they have retained their residential mortgage portfolio, it is in wind-down mode. The Sunday Business Post, 26th July


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