4th October (Issue 367)
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
St Stephens Green, Dublin 2 Having served as the Dublin base of Axa subsidiary, the XL Group, since 2013, No. 8 St Stephens Green is being offered to the market with the benefit of vacant possession by Cushman & Wakefield at a guide price of €20m. The subject property comprises a substantial four-storey over-basement Georgian townhouse. The property was then sold for €7.8m to its current owners, the XL Group, in 2012 by receivers acting on behalf of the former Anglo Irish Bank. Presently the property extends to a total of 28,418 sq. ft. of lift-serviced space. No. 8 St Stephen’s Green is zoned Z5 under the Dublin City Development Plan 2016-2022, which provides for a wide range of uses subject to planning permission. The Irish Times, 28th September
For lending terms on this asset please contact rossmetcalfe@origincapital.ie
Swords Road, North Dublin Having secured a commitment from Laya Healthcare to lease all 20,000 sq. ft. of the office accommodation at the newly developed Corballis Hall on Dublin’s Swords Road, QRE Real Estate Advisers is seeking a new occupier for the property following Fingal County Council’s rejection of an application for the building to be converted into a minor injury and wellness clinic. QRE is quoting a rent of €35 per sq. ft. Completed in 2020, the subject property briefly comprises 20,000 sq. ft. of modern, sustainable grade A office accommodation. There are 32 underground car-parking spaces coupled with secure bike-parking spaces. Corballis Hall is available in its entirety or on a floor-by-floor basis. The Irish Times, 28th September
North Docklands, Dublin Ronan Group Real Estate (RGRE) has secured full ownership and control of the Waterfront South Central site in Dublin’s north docklands. The agreement between RGRE and its partner, Fortress, clears the way for the developer to commence the construction of a new European headquarters for global banking giant Citigroup on the site. According to market sources, work on Citi’s new offices is expected to get under way within the next month. While the price paid by RGRE for the 70% stake held by Fortress is not known, the figure will have been significant. Ronan acquired the Waterfront site with RGRE’s then funding partners, Colony Capital, for €180m in 2018. Fortress inherited Colony’s interest in the 4.6-acre site last year as part of its wider $2.7bn buyout of Colony’s international real estate assets. The Irish Times, 28th September
Hollyhill, Cork Cork City Council has granted permission to Apple Operations Europe Limited for the construction of a four-storey office block on lands a the Hollyhill Industrial Estate, adjacent to its existing premises. The new four-storey building could accommodate c. 1,300 extra workers. Apple has operated on the north side of Cork city since the 1980s and currently employs 6k people at offices in Hollyhill, Lavitt’s Quay and Horgan’s Quay. The proposed office building will be constructed within the existing car park and will connect to an existing office building known as ‘HH4’. The Irish Examiner, 3rd October
HOSPITALITY
Rathmines, Dublin 6 Developer Paddy McKillen jnr and Matt Ryan’s Oakmount is offering the Stella Cinema in Rathmines to the market at a guide price of €9.5m (NIY 5.26%). The Stella is being sold with the benefit of Press Up Entertainment Group in place as tenant with an unexpired lease term of 20 years and an annual rent of €550k. Presently, the property comprises c. 13,954 sq. ft. of accommodation and can seat up to 216 people. The Irish Times, 28th September
Ballymahon, Co Longford Center Parcs Ireland Limited received permission for a major expansion of its existing holiday village in Ballymahon, Co Longford, which currently sits on a 395-acre site. The new development will include 198 new lodges, a treetop sauna and pool, an expansion of its restaurants, cafes and shops, and the installation of solar panels. The expansion is expected to cost €85m. The company has also reduced its share capital to create a cash pile of €142.2m. The Business Post, 1st October
Cobh, Co Cork Agent Johanna Murphy & Sons has brought to market a waterfront restaurant and bar for sale in the seaside village of Cobh in Cork with a guide of €5m. The Quays Bar and Restaurant is a well-established indoor and outdoor venue which underwent a full renovation in 2020, estimated to cost c. €1m. The restaurant extends to 1,162 sq. ft. and has an indoor seating capacity for 200 people. The Quays at 17 Westbourne Place boasts the only premises in Cork to have a private pontoon (which extends to c. 355 sq. ft.). The venue is well laid out with a bar area at the rear and a large waterfront seating/dining area at the front. Offices and ancillary laundry space and staff facilities are above, with separate access from Westbourne Place. The Business Post, 1st October
Castlemartyr Resort, Co Cork A sum of €8m has been pumped into upgrading the 5-star Castlemartyr resort by its new Singaporean owners who bought it for c. €20m little more than a year ago. Investors Dr. Stanley Quek, a graduate of Dublin’s Trinity College and current pro-chancellor, and Irish-born Peng Loh have invested heavily in refurbishing the Castlemartyr hotel’s 108 bedrooms and guest suites, as well as carrying out substantial improvements to the grounds. The Irish Examiner, 29th September
MIXED USE
Chancery Lane, Dublin 8 The Chancery building is being offered to the market by Knight Frank at a guide price of €24.75m (NIY 5.5%). The price being sought represents an increase of €950k on the €23.8m Credit Suisse paid Hibernia Reit to secure ownership of the property in 2017. The Chancery comprises a modern six-storey over-basement office and residential development on Chancery Lane in Dublin 8. The office element of the scheme extends to 34,283 sq. ft. with secure basement car parking for 19 cars and further parking for bicycles. The apartment block is four storeys in height with one unit per floor. All four apartments are two-bedroom units and extend to 818 sq. ft. each. The offices are fully let to three tenants and are producing total rental income of c.€1.4m pa with 69% of it being generated by State tenants. The ground floor is let to Wella Studio, a hairdressing-training company. The first to fourth floors are let to the Office of Public Works and are occupied by the Chief State’s Solicitors Office (CSSO). The penthouse floor is occupied by Analytic Partners. The four apartments are fully let to private residential tenants and equates to rent of c. €99k pa. The subject property also comes with full planning permission to extend the floor area of the office accommodation by 9,838 sq. ft. The Irish Times, 28th September
For lending terms on this asset please contact rossmetcalfe@origincapital.ie
Phibsborough, Dublin 7 CBRE is guiding an overall price of €12m for a portfolio comprising two sites with residential development. The first property, on North King Street, carries a guide price of €8m, while the second property, on nearby Phibsborough Road, is guiding at €4m. The North King Street property extends to c. 0.83 acres and is occupied by tenants using the building for retail and industrial purposes. The tenancies provide c. €145k in rental income per year. The site, which is less than 1km from TUD’s Grangegorman campus, is zoned “Z5 City Centre”, allowing for varied development options. The Phibsborough Road property, meanwhile, comprises retail units, an office, storage facilities and a single residential dwelling, and produces rental income of c. €258k pa. Its current tenants include Camile Thai, Four Star Pizza, Rua Woodfire Pizza, Thunders Bakery and Avista. A vacant lot at 141-142 Phibsborough Road has potential to add to the rent roll. This land holding is currently zoned “Z4 District Centre” with a proposal for this to be amended to “Z4 Key Urban Village” under the Dublin City Draft Development Plan 2022-2028. The Irish Times, 28th September
INDUSTRIAL / LOGISTICS
Greenogue Business Park, Dublin Palm Capital and KKR have fired the starting pistol on a c. €110m Irish logistics sale. The two-building hub – forward funded by KKR and speculatively developed by Palm Capital – is located at Greenogue Business Park, one of Dublin’s premier logistics destinations. CBRE and Savills have been instructed to manage the sale, which is to be marketed off a NIY of c. 4.25%. The sale comes after KKR and Palm successfully leased the site to three occupiers, most recently adding a supply chain giant to the tenant roster. The firm has agreed to lease building two, a 285,000 sq. ft. warehouse. US group Tosca, a firm that specialises in packaging and pooling solutions, and another occupier leased the first warehouse. React News, 27th September
STUDENT ACCOMMODATION
Bandon Road, Cork Off-site construction was a key measure in the delivery of Cork city’s single largest student accommodation development to date, the €53m, 554-bed Ashlin House, on Bandon Road. The scheme is managed by Nido Student with room rates quoted online at €240-€289 per week. Planning was first granted for 324 beds, and a subsequent application achieved planning for 554 beds, with work starting in May 2020, during the pandemic period. The Ashlin House complex is made up of five blocks each with shared apartments (up to eight c. 150 sq. ft. en suite bedrooms beds in some), studio rooms, and a three-bed townhouse. The Irish Examiner, 29th September
RESIDENTIAL / DEVELOPMENT
Clongriffin, Dublin 13 Ballymore has pulled out of a €45m deal to buy a 27-acre site in Clongriffin, Dublin, as developers anticipate a dramatic slowdown of the private rented sector (PRS) in Ireland. PRS, which involves the sale of large developments to institutional funds, has been the main driver of apartment construction in recent years. Ballymore was chosen as the preferred bidder in March for the land, which is owned by Gannon Properties. The site has planning permission for 1,937 apartments, the majority of which — 1,130 — are for the PRS market. Property sources say with costs up by as much as 15% and capitalisation values down, the developer could not make the transaction work. The Sunday Times, 2nd October
Dundalk, Co Louth A strategically located residential development site in Dundalk, Co Louth, is being offered for sale with a €5m guide price. Extending to 15.2 acres, the Mount Avenue site is situated 1.5km north-west of Dundalk town centre and fronts on to the N53 road which links the M1 motorway with Dundalk town centre. According to Knight Frank, the Louth County Development Plan 2021-2027 shows the majority of the site as zoned objective A2 New Residential and a small element as zoned objective H1 Open Space. The Irish Independent, 29th September
Ballyfermot, West Dublin A proposal by healthcare firm Uniphar to build a housing development at a site it owns in Dublin has sparked claims by a neighbouring business that the 16-storey development would be “completely unsuitable and unsafe”. Publicly listed Uniphar is backing a Dublin City Council plan to rezone a 4.5-acre site it owns next to the N4 between Chapelizod and Ballyfermot – a move it hopes would pave the way for a major apartment and mixed-use development. The city council previously backed away from rezoning the land following a High Court challenge. Should the latest application prove unsuccessful, Uniphar is understood to be considering using the site as a warehouse facility for its growing consumer health division. The Irish Independent, 2nd October
Social Housing, Ireland Ikea store parent, Ingka Investments, has committed €100m to fund the development of more than 250 social housing units across the Greater Dublin Area, with at least 150 of them ready for occupation over the next three years. Upon completion, the new homes will be leased on a long-term basis to the relevant local authority. In a fresh departure from the practice of other institutional investors involved in the supply of social housing, the Ingka Group says it will treat the rental payments it collects as mortgage repayments. This will allow the transfer of all 150 homes to the local authorities in question at the end of the lease term at an estimated zero additional cost. The Irish Times, 3rd October
Lower Grand Canal Street, Dublin 2 The High Court has granted a temporary injunction preventing local residents from blockading the site where an eight-story building is being constructed in central Dublin. The interim injunction was granted on an ex-parte basis in favour of RGRE Dev Co No. 5, which is currently developing the Treasury Annex Building at Lower Grand Canal Street in Dublin 2. RGRE said it was not prepared to meet the residents’ payment demand, and that the blockade amounts to an unlawful interference with its right to access the public road from the site. The injunction prevents the residents and anyone acting in conjunction with them from blockading the construction site until further order of the court. The Irish Times, 30th September
OTHER
Vacant Homes Tax, Ireland An estimated 22k derelict properties will be exempt from the government’s new vacant homes tax (VHT), which was introduced in last week’s budget to help raise the supply of residential properties to buy or rent. Several exceptions to the tax have been announced by the Department of Finance that include properties that were recently sold; that are listed for sale or rent; that are vacant because of an occupier’s illness or long-term care; that are vacant because of significant refurbishment work or are derelict. In the GeoDirectory Residential Buildings Report for the second quarter of this year, prepared by EY, 21,897 addresses were classified as “derelict” last June. The report noted that the number of vacant residential properties fell by 5.9% in the year to June, with 86,708 dwellings classed as vacant nationally. Preliminary figures from the 2022 census show there are 166,752 vacant homes. A property will be considered vacant for the purposes of the tax if it is occupied for less than 30 days a year. The Sunday Times, 2nd October
Social Housing, Ireland The plan to completely phase out leasing homes for social housing is still under review, despite a commitment from Micheál Martin to end the practice by 2025. The latest report from the Dublin Housing Delivery Group, published by the Department of Housing, said “a review of the impacts of any change” from the proposed plan to phase out leasing social homes “is currently under way and will inform final policy decisions in this area”. Under Part V rules, developers of new-build housing are obliged to sell 10% of new homes to the state, at a break-even price, for use as social housing. If the council cannot afford the price set by the developer or the cost exceeds state imposed spending limits on social housing, a council can opt to lease the homes instead. Details of the review come following the creation of a new €450m state fund to lease 1,000 new-build homes, a further move by the government that has raised questions over its commitment to phasing out leasing. The review into completely phasing out leasing social homes under Part V rules, tendered for by the Housing Agency and awarded to EY Ireland, is due for completion this month. The Business Post, 28th September
East Clare An Bord Pleanála has given the green light to Coillte for contentious plans for a large scale 19 turbine wind farm in east Clare. The 110MW project on the northern western slopes of Slieve Bernagh is located on a 1,853-acre site 4km northeast of Broadford, close to Killaloe and Bodyke. The turbines on the Carrownagowan wind farm have a tip height of 555 ft. Documents lodged with the planning application state the wind farm will displace 2.8m tonnes of CO2 over its lifetime. The windfarm would produce enough electricity to power 66,500 homes per year. The Irish Times, 30th September
MetroLink, Dublin A planning application for Dublin’s MetroLink, which has an estimated cost of €9.5bn, has been lodged by State transport provider Transport Infrastructure Ireland. MetroLink is to be the State’s first mostly underground railway running between the Swords area and Charlemont in south central Dublin. The route will serve Dublin Airport and residential communities in Swords, Ballymun and Glasnevin, the city centre, as well as linking major employment and education facilities. The route is 18.8km, and it is proposed to have 15 stations on opening with more later. Should Bord Pleanála give the project the green light construction is earmarked to get under way in 2025, and the line would be operational in the early 2030s. The Government has acknowledged a wide variation in estimates for the project. At the lower end the target cost is €7.16bn, with the central estimate at €9.5bn and an upper estimate allowing for high inflation and contingencies at €12.25bn. The Irish Times, 30th September
Maynooth University has “terminated” construction of a new student centre project due to rising costs, the third level institution has announced. The decision has been criticised by students and their union, as the project was being funded through a €150 annual student levy since 2015. Construction on the 39,826 sq. ft. building was due to be completed by July 2023, but it was terminated on Monday following a decision by Maynooth University (MU)’s governing authority. In a statement, the university said the project has been “adversely impacted by rapidly escalating costs, linked to technical construction issues as well as hyperinflation”. The Irish Times, 28th September
Savills Report Assumptions that underpin the Government’s National Planning Framework (NPF) about how population growth will be spread out across the country are “unrealistic” and will mean “we are structurally under-provisioning housing supply in the Dublin region for the next 20 years”, Savills has said. According to Savills, the NPF’s focus on increasing residential density within urban areas to prevent urban sprawl means that less land has been made available in county development plans for the Greater Dublin Area than in previous times. This amounts to “a large reduction” in zoned residential land, which they estimate would have had the capacity to accommodate more than 100k units in Dublin, Meath, Kildare and Wicklow, the equivalent of around a decade’s worth of supply. Residential Land Supply Study 2022, Savills, 4th October
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