3rd November (Issue 19)

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 Clear: Ulster Bank is believed to have a shortlist of bidders for their Project Clear loan portfolio. With the portfolio split into three tranches, investors could target either the entire portfolio or individual tranches. Bids from Lone Star, Cairn Homes and Michael O’Flynn/Avenue Capital have been shortlisted for the entire portfolio. Centerbridge and a joint bid by Joe O’Reilly and the Abu Dhabi Investment Authority are amongst the bidders for the individual tranches. The portfolio is secured by 1,850 acres of zoned land, which has potential for 20,000 homes. The Sunday Times, 1st November


AIB Bankcentre: Developer Johnny Ronan has completed the purchase of a c. 3.7 acre site which previously formed part of AIB’s HQ in Dublin 4 for c. €50m. Financing for the transaction was provided by Cardinal Capital and Jefferies Loancore. Ronan is shortly expected to seek planning permission to redevelop the site into grade A office buildings in a project which could cost up to c. €330m. The site was sold under the instructions of a receiver appointed by Ulster Bank and NAMA. The Irish Independent, 1st November


55 Percy Place: Savills are guiding in excess of €8.25m for a commercial development in the final stages of completion in Dublin 4. 55 Percy Place consists of a restaurant, café and office space which have all been pre-let and will generate rental income of €450k p.a., a net return of c. 5.25%. The owners of the site are Development Securities and Oakmount. The companies purchased the site for €2.5m after it previously sold for €13m during the boom. The 4,595 sq. ft. office space has been let at c. €50 psf. An initial rental income of €200k p.a. has also been secured for the 3,540 sq. ft. restaurant and 882 sq. ft. café. The Irish Times, 28th October


Grove Court: IPB Insurance have paid c. €13.4m (7.3% yield) for two office properties at Grove Court in Blanchardstown, Dublin 15. The purchase price was €1.4m above CBRE’s initial guide price of €12m. Blocks Three and Four have a combined floor area of 68,200 sq. ft. and were developed in 2007 by Bernard McNamara. 98% of the current rental income of c. €979k p.a. comes from government tenants, including the OPW and the HSE, while the leases have an average of c. 12 years left until expiry. The Irish Times, 28th October

Ballymoss House: Bids of at least €15m are being sought by Savills for the partially let Ballymoss House in Sandyford, Co. Dublin. The four-storey property has a floor area of 65,000 sq. ft. and 164 car spaces. Three of the four floors are vacant, however the new owners should not have any problems finding new tenants given the shortage of office space in Dublin. BMC Software occupy the ground floor and 39 car spaces on a 25 year lease from 2000 at an annual rent of c. €390k. The rental income for the property, when fully let, is estimated at €1.56m. The Irish Times, 31st October

Cavan Properties: Joint agents CBRE and Quadrant Real Estate are guiding €3.8m for two mixed used properties in Cavan Town. The properties, Hillside and Riverside at Connolly Court, are generating annual rental income in excess of €435k. Hillside is a four storey retail and office building with five ground floor retail units and a primary care centre overhead. The HSE are the primary tenant in Hillside, paying c. €269k of the total annual rent of c. €396k. Riverside is also a four storey property with two retail units and twelve apartments overhead. Gamestop occupy one retail unit on a 25 year lease from 2008 at an annual rent of c. €40k, with the other unit vacant. The Irish Times, 28th October


Clarion Hotel Sligo: The Clarion Hotel in Sligo, which cost c. €45m to convert from a hospital, is now being sold through Savills for €7m. The four star, 162 bed hotel is trading profitably and is a popular location for weddings, with two private churches on its grounds. There are also excellent gym and leisure facilities in the hotel, with c. 800 members subscribed. Receivers Crowe Horwath are managing the sale.  The Irish Times, 28th October


Arnotts: Selfridges have completed the purchase of Dublin department store Arnotts from Noel Smyth’s Fitzwilliam Finance Partners for an undisclosed amount. Selfridges had previously been part-owner of the store, along with Fitzwilliam Finance Partners, through an investment vehicle called Whittington Investments. In order to secure ownership, Whittington recently paid c. €107m to Ulster Bank and Apollo to purchase loans secured by Arnotts and nearby properties. The c. 267,000 sq. ft. Arnotts will not be rebranded following the purchase. The Irish Times, 3rd November

Phibsboro Shopping Centre: BNP Paribas have set an asking price of €15m on Phibsboro Shopping Centre and two sites in Dublin 7. The property was previously owned by Pascal Conroy’s Albion before NAMA appointed EY as receivers. With the c. 40,000 sq. ft. centre in need of refurbishment, investors will have to decide whether to embark on a complete redevelopment or a refurbishment and extension of the existing centre. The current rent roll of the centre is c. €975k p.a. Feasibility studies from architects suggest that the 2.85 acre site could facilitate c. 236,000 to c. 269,000 sq. ft. of office, restaurant, cafe and residential accommodation. The Irish Times, 28th October

The Park: Offers in excess of €45m are being sought by Savills for a c. 18 acre site in the highly successful business and retail park facility, The Park in Carrickmines, Dublin 18. While the majority of the land is zoned for use as a district centre, Dún Laoghaire-Rathdown County Council has identified the need for a multiplex cinema and neighbourhood centre in the area. Savills are to sell the site in one or more lots, with the largest being 12.63 acres. The Park was developed by Park Developments in two phases in 2004 and 2007, with both phases purchased in 2006 and 2007 by Warren Private for c. €100m each. The Irish Times, 28th October


Michael O’Flynn: Developer Michael O’Flynn plans to build more than 10,000 new homes in Ireland over the next seven to eight years after securing a €400m funding package. The €400m funding package includes senior debt from AIB and his joint venture partner Avenue Capital which will allow O’Flynn to regain control of his business, O’Flynn Construction Group, from Blackstone. O’Flynn Construction reportedly have sites with planning permission to build 500 units, an existing stock of over 200 units, 360 acres of zoned land with potential for 3,500 units and 186 acres of unzoned land. The Irish Times, 29th October

Property Prices: New figures released by the CSO show that residential property prices in Dublin rose by 0.9% in September 2015, reflecting a 6.5% increase over the past twelve months. This is the lowest annual increase since April 2013. The reduction in growth has been attributed to the introduction of the new mortgage lending criteria and the expiration of the CGT waiver on property purchases. Outside of Dublin, prices rose by 1.6% in September and are now 8.9% higher than they were twelve months ago. On a national level, residential property prices are still 34.6% below their peak in 2007. The Irish Times, 29th October


Commercial Property Returns: The latest data published by CBRE shows that prime office yields in Dublin have rebounded by 91% since the crash, representing the strongest recovery in any of the 54 EMEA cities in CBRE’s survey. Prime retail rents in Dublin (Grafton Street Zone A) have also risen by 22% this year, the second fastest rate of growth recorded. Only Barcelona had higher growth at 23%, however its prime rents of €251 psf are less than half of Dublin’s, at c. €511 psf. The Irish Independent, 29th October

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