3rd September (Issue 463)
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.
Office
East Wall Road, Dublin 3 BCP Capital is closing in on the purchase of the Beckett Building on Dublin’s East Wall Road for approx. €35m (14.9% NIY; €185 per sq. ft), which had been guided by Colliers when it offered the property to the market. The expected sale price represents a reduction of 56% on the €80m figure that had been mooted when CBRE first offered the building for sale in January 2023, and a discount of 65% on the €101m Kookmin Bank paid when they acquired it. Meta remains responsible for its annual €5.75m rent and all outgoings until the break option of its lease on July 31st, 2027. The Irish Times, 29th August
Dublin Vodafone is weighing up a move from its headquarters in Leopardstown in south Dublin. The telecoms giant has gone to the market in recent weeks with a requirement of between 48,437 sq. ft and 69,965 sq. ft. Such an office size could accommodate 500 to 700 people. It would be considerably smaller than the company’s current base at Central Park, which is approx. 263,715 sq. ft. The lease is due to expire in 2026. The Sunday Times, 1st September
Office Portfolio New financial accounts for Henderson Park’s main Irish operation show it recorded a €215.1m impairment on its investment in subsidiaries in 2023. This resulted in the value of its property portfolio in Ireland falling from more than €1.14bn to €930.3m in the year to the end of November 2023. The records for Hpref Dublin Office Bidco Limited, which is the main operating vehicle for Henderson Park in Ireland, also showed income from its subsidiaries fell from €219.5m to €131.9m and the company booked an after-tax loss of €178.4m. The Business Post, 31st August
HOSPITALITY
Valentia Island, Co Kerry The Royal Valentia Hotel on Valentia Island in south Co Kerry has come to market with a guide price of excess €3m. The hotel is being sold by CBRE on the instructions of its Dublin owners, the Kidd family, who acquired the hotel in 2006 and are now retiring. The venue has 30 rooms and was recently granted planning for an additional 21 bedrooms. The Business Post, 29th August
Galway The Sleepzone Hostel in Galway city has been rebranded and has begun trading as The Dawson Hostel following the sale of the business on behalf of Ronan Garvey to a consortium of private Irish investors. While the value of the deal has not been disclosed, the Galway hostel is understood to have sold for the €5m price that had been guided by CBRE last January. Located on Bóthar na mBan, The Dawson Hostel Galway comprises a purpose-built four-storey accommodation facility with 180 bed spaces distributed across 35 rooms. The Irish Times, 28th August
INDUSTRIAL / LOGISTICS
Citywest, Co Dublin JLL and Harvey have been jointly appointed to lease Unit 34 Magna Business Park in Citywest on behalf of real estate investment manager, EQT Exeter. The prime, Grade A unit is under construction and will span approx. 149,403 sq. ft when completed to the latest ESG standards in Q4 2025. The development is a collaboration between EQT Exeter and the Irish-owned firm Sandymark. The Business Post, 31st August
STUDENT ACCOMMODATION
Investment One of the world’s biggest student accommodation providers has warned that it is actively diverting investment out of Ireland amid a sharp row with the government over new laws to regulate the sector. GSA Group, which operates approx. 4,000 student beds in Ireland through the Yugo brand, has said it is choosing to build in other European locations. The company has threatened to launch legal action against the government after it passed emergency legislation that stops operators from operating 51-week leases. The Business Post, 1st September
Ringaskiddy, Cork Plans for 24 student apartments in Ringaskiddy have been rejected after a referral to An Bord Pleanála. Cork County Council had initially blocked the development, which had been proposed by PByrne Partnership for a site at Rose Lodge Main Street in Ringaskiddy. The proposal included plans for 24 student houses, comprising 192 study bedrooms and additional communal amenities. The houses would be two-storey dormer-style houses, purpose-built for the student population of the area. The Irish Examiner, 27th August
Residential / Development
College Green, Dublin 2 The former Ulster Bank premises on College Green has gone back up for sale, with a guide price of €14m, according to agent Cushman & Wakefield. The property listing, which is currently listed as ‘sale agreed’ on its website, is up from the previous guiding price of €13.5m when it was first put up for sale in September last year. Located at 33 College Green, the building has a total floor plan of 62,861 sq. ft and it sits on a site of 0.3 acres. The Business Post, 28th August
Blackpool, Co Cork The developers of a €30m apartment scheme in Blackpool plan to break ground before year end, having reached agreement with an approved housing body. Cork city-based Bellmount Developments Ltd plan to build 114 apartments on Redforge Road, the former site of Millfield Service Station. The government-backed scheme, which will range in height from four to nine storeys, will be a mix of cost rental and social housing, with an approx. 50/50 split. The development will include 79 one-bed and 35 two-bed apartments. Bellmount’s directors expect the building work to be completed by the end of 2025. The Irish Examiner, 29th August
Deansgrange, South Dublin Ten residents have won their High Court challenge against planning approval for a proposed development of 299 housing units on a site adjoining Clonkeen College. Permission was sought for 299 units, comprising 60 duplexes in six three-storey blocks, 239 apartments in four six-storey blocks, and a single storey childcare facility on a site owned by the Christian Brothers but subject to a contract for sale to Clonkeen Investments, the completion of which depended on planning permission. The Irish Times, 1st September
Mortgage Activity A total of 5,313 home loans were approved by Irish lenders during July, up 11.9% on a year earlier, according to BPFI. Approvals rose 18.6% MoM in July. The value of mortgages approved in the month rose 18.8% on the year to €1.61bn. It increased by 20.2% on June. First-time buyers accounted for approx. 63% of approvals, by value, during July, while people moving to another home made up a further 27%, the BPFI figures show. The Irish Times, 28th August
Housing Policy Sinn Féin has pledged to spend €39bn on housing over the next five years to deliver 300,000 homes, if the party is elected to government. Housing spokesman Eoin Ó Broin and party leader Mary Lou McDonald unveiled the new housing plan in Dublin, which promised to end subsidies for home buyers, reduce rent subsidies, deliver affordable homes for between €250k – €300k, strengthen tenants’ rights and freeze rents for all existing and new tenancies for three years. The full cost of the Sinn Féin plan over a five-year period, it says, would be €39bn, comprised of €37bn for a programme of new building and €2bn for housing acquisitions. The Irish Times, 2nd September
Residential Construction Financing There has been a 200% growth in financing approvals for social and affordable homes in the first six months of 2024, the State agency with responsibility for lending to local authorities and AHBs has said. The Housing Finance Agency said that a total of €861.5m was sanctioned for AHBs to facilitate the delivery of a planned 3,194 new homes between January and June this year. It also said that a total of €455m was drawn down by AHBs to contribute to the development of 1,328 homes in the first half of the year. The Irish Times, 28th August
Sherry FitzGerald Report Development land transaction activity in the Greater Dublin Area and the regional centres of Cork, Galway and Limerick, rebounded during the first half of 2024 to reach approx. €411m, according to Sherry FitzGerald. The figure is more than double the €146m recorded for the same period in 2023. It is also higher than the long-term first-half average of €318m, according to the report’s authors. Overall, the volume of development-land transactions remained stable, with 43 sales closing during the first six months of this year, compared with 40 deals for the same period in 2023. The Irish Times, 28th August
Savills Analysis A new analysis by Savills Ireland identified an average of 5.9 properties for rent or share for every 10,000 people, less than a quarter of the number of homes for sale (24.2). Dublin had the highest availability of rental properties, at 15.3 per 10,000 people. However, it warned that supply of rental stock is significantly falling off, with a 27% drop anticipated for this year, and a further 58% collapse expected in 2025. The analysis also extended to the market for homes to purchase and found that Dublin had 19.5 homes on the market for every 10,000 people. The Business Post, 28th August
JLL Report According to JLL’s Dublin Living Report, the living investment sector in Ireland has plateaued over the last four quarters after nearly a decade of rapid expansion. This is due to weaker market fundamentals, particularly around the economics of development and higher costs of borrowing, along with the 2% rental cap. In the opening half of 2024, the number of deals are down 55.4% on the 10-year H1 averages and volumes are down 71% in the same period. Despite the challenges presented, there has not been the more extreme repricing that has been experienced in some of the other sectors. Strong occupier fundamentals, rental growth, and overall operational performance have underpinned values. JLL Report, 3rd September
OTHER
Non-Performing Exposure Banks could begin to move more aggressively in the coming months with an expected sharp rise in non-performing exposures in Ireland’s commercial property market, a Grant Thornton insolvency expert has warned. A number of high-profile property sales are expected to close at approx. 15% below asking price soon and this could lead to technical defaults on other loans in the market, sparking action by the banks, said Colm Dolan, a director in the accountancy firm’s restructuring department. The Irish Independent, 1st September
Offshore Wind Energy Codling Wind Park, Ireland’s largest phase one offshore renewable energy project, will submit its planning application to An Bord Pleanála. The project is a joint venture between offshore wind developer, Fred Olsen Seawind and energy company, EDF Renewables. Codling Wind Park will have a capacity of up to 1,300 megawatts and will be able to supply over 1 million Irish homes with clean renewable energy. It will be located between 13 to 22 km off the Wicklow coast and will connect to the Irish grid at Poolbeg in Dublin. The Business Post, 29th August
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