5th December (Issue 426)

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.



St Stephen’s Green, Dublin 2 Kennedy Wilson is said to be weighing up the disposal of The Shelbourne hotel in Dublin for €260m. The US investment firm has reportedly appointed Eastdil Secured to sound out buyers for a 50% stake in the hotel for approx. €130m. However, the company is also considering offloading the entire property, which was valued at €236m, according to accounts filed earlier this year. It bought the hotel located on St Stephen’s Green in 2014 for €138m in a distressed sale at a significant discount. Later, the company invested €36m to refurbish the premises between 2015 and 2017. The 265-bedroom property generated higher income this year on the back of increased visitor travel since the pandemic, achieving approx. €15.3m. The Shelbourne hotel is the only operating hotel fully owned by Kennedy Wilson. The hotel is under a management agreement with Torriam Hotel Operating Company, a Marriott subsidiary, which will expire in 2026. React News, 4th December

Stephen’s Lane and Dame Street, Dublin 2 Investment manager Colm Wu has sold two Dublin South City Centre properties. 37 Dame Street has sold for €2.3m which is a discount to the €2.8m which was quoted for the premises when it was offered for sale last year. The premises is well located, between Trinity St and South Great George’s St, and opens to the rear onto Dame Lane with its Stag’s Head bar. Extending to 6,818 sq. ft, it comprises a five-storey former house over a concealed basement. The former Dobbins property at 15 Stephen’s Lane was in need of significant refurbishment and sold for €850k, which was a 43% discount to the €1.5m sought for it early last year. A mews style property, it is believed to have been bought by a builder and is well located between the two Mount streets. A purpose-built two-storey restaurant building, it extended to 3,778 sq. ft with capacity for more than 100 covers. Robert Colleran was the agent handling both sales. The Irish Independent, 30th November

JLL Hotel Report According to JLL, robust hotel market demand is evident by key indicators such as Dublin Airport reporting record passenger numbers with over 120k passengers travelling through the two terminals on Sunday, July 30th. Passenger volumes remain strong, with 2.8m passengers in the month of October, a 4% increase on the same month last year. This is reflected in the performance of the hotel sector. In June, for instance, Dublin city achieved a 91% occupancy level, a record €258 average room rate, and a RevPAR of €234. This broke the existing RevPAR record set, when 400k people attended the Garth Brooks concerts in Croke Park in September 2022, by 8%. In a year when investors have questioned the fundamentals of other real estate sectors, hotel investment volumes remain strong, with JLL forecasting more than €500m worth of transactions. Should this figure be achieved, it would represent an increase of approx. 20% on 2022. The profile of buyers for the first half of the year was predominately comprised of high-net-worth individuals and hotel operators. Q3 was a quiet and uncertain period, with back-to-back increases in interest rates. The Irish Times, 4th December

Ballymahon, Co Longford Center Parcs has secured planning permission for a €100m expansion of its holiday village at Longford Forest which includes approx. 200 new lodges. An Bord Pleanála rejected an appeal by a number of parties including an environmental group against plans by the UK-based operator of leisure resorts for a major expansion of accommodation and leisure facilities at its Irish centre. The board has upheld last year’s decision by Longford County Council to approve the construction of 198 new lodges across three zones at its Longford Forest resort outside Ballymahon. The expansion of the 395-acre holiday village also includes external saunas and pods, a new lakeside restaurant and coffee shop as well as an extension of several existing restaurants and additional staff facilities. A new car park will provide 313 parking spaces for staff vehicles. Longford Forest currently provides 466 self-catering lodges and 30 apartments. The Irish Examiner, 30th November



Walkinstown, Dublin 12 Colliers has concluded the off-market sale of an ultra-modern Bank of Ireland premises in Walkinstown, Dublin 12 for €4.175m (NIY 6.42%; €352 per sq. ft) to French fund FPS Europe +, a specialised professional fund owned by MNK Partners. The premises at 177 Drimnagh Road, which comprises a part single and part two storey detached premises, spans 11,830 sq. ft. The property is let on a FRI Lease to Bank of Ireland from October 24th, 2012, for a term of 25 years, with no break options. The lease is subject to five-yearly fixed rental uplifts of 15%. The passing rent is €294.9k pa with the next fixed uplift in 2027, at which point the rent will increase to €339.16k pa. The final rental increase to €390k pa in 2032 will provide the new owner with an increased return of over 8.4%. The Business Post, 2nd December

Applegreen and M&S are significantly extending their partnership, signing a ten-year deal that will add up to 60 new M&S Food service points at Applegreen locations. Fifteen new outlets will be open by the end of 2024, adding to the five already in operation, and all of the new outlets will also offer click and collect services for M&S Clothing and selected homeware ranges. The first M&S Food shop at an Applegreen opened last November at Mountgorr in Swords in North Co Dublin. Further outlets were added in Booterstown in South Dublin, Celbridge in Co Kildare, Kinsealy in Co Dublin and the M11 services area at Cullenmore, in Co Wicklow. The first of the new stores will be in Louth, Meath and Limerick, with other locations to be announced throughout the year. The outlets carry a range of up to 400 M&S products including fresh fruit, salads, Irish sandwiches and dinner options. The Business Post, 4th December



Rialto, Dublin 8 Plans have been lodged for a €26m mixed-use Large Scale Residential Development (LRD) development in Rialto. The project is located at the former G4S property on Herberton Road. The plans, submitted by Herberton Road Development Limited, propose the construction of 120 apartments and a community cultural space. It incorporates studios, co-working space, meeting room and a reception area. The Business Post, 1st December

Clongriffin, Dublin 13 Developers Gannons are selling a mixed-use investment in Clongriffin which comprises eight commercial units and five residential apartments. Joint agents Knight Frank and Colliers are quoting €1.715m (gross yield 10.1%) for the properties which are spread between premises on Main Street and Park Avenue in Clongriffin. Five of the commercial units are occupied and generating €82.1k pa. The current tenants in situ include a Centra convenience store, a restaurant, barbers and beauty salon and a community hub. The five apartments consist of three-bedroom apartments, four of which are within blocks on Park Avenue and one which is located in a block on Main Street. The apartments extend on average to 1,040 sq. ft and are privately let and generating a gross income of €101k pa. The Irish Independent, 30th November

Drimnagh, Dublin 12 Plans from a Conor McGregor company to build a 113-unit apartment block in his native Drimnagh have attracted opposition from locals, including a couple in their 80s. Emrajare Ltd lodged plans for the eight-storey, mixed-use development with Dublin City Council last month. They would involve the demolition of the Marble Arch pub that MMA fighter Mr McGregor bought two years ago, reportedly paying up to €2m. The LRD application also foresees the demolition of warehouse buildings/structures on the 0.72-acre site, with Emrajare to build a restaurant/bar/cafe, a gym and a retail unit in addition to the apartment scheme. The Marblearch LRD apartment element would consist of 57 two-bed units, 53 one-bed units and three studios. The Irish Times, 29th November



Castleforbes Business Park, Dublin 1 Eagle Street Partners has started construction of 702 apartments at Castleforbes Business Park in Dublin’s North Docklands. Catering for the private rental and social and affordable housing markets, the development will, upon completion, comprise 508 studios and one-bed units, 179 two-bed apartments and 15 three-bed apartments distributed across eight blocks with an 18-storey residential tower as its centrepiece. It will also include community and public amenity space and an adjacent hospitality offering. Eagle Street Partners is delivering the docklands development in a joint venture with Nuveen Real Estate and the Australian superannuation fund Hesta. Nuveen is acting as investment adviser to the joint venture while Eagle Street will act as developer and operator of the 702 rental apartments, under its resident space operating platform. The residential block is being financed by Apollo Global Management. The first phase of the scheme is expected to reach practical completion in the third quarter of 2025. The Irish Times, 30th November

Housing Initiatives According to Hooke & MacDonald, the Irish government’s Housing for All strategy is starting to make a significant difference across a number of areas of the housing sector. More than 40,000 first time buyers have secured their first home as a result of the Help-to-Buy initiative since its introduction in 2016; and the 16-month-old First Home (shared equity) Scheme has seen its 1,000th facility drawdown last month. The Croí Cónaithe (Cities) scheme aims to bridge the current “viability gap” between the cost of building apartments and the market sale price. Local authorities, the Land Development Agency and Affordable Housing Bodies are being funded by the government through a wide range of measures to supply subsidised housing for rent and to own. The one area that is currently not functioning properly is the private rented sector, which is made up of mostly smaller landlords (over 80%). Commentators and the Housing Commission have pointed towards a requirement to build 50,000 to 60,000 new homes per annum in Ireland to meet current demand. The Business Post, 2nd December

Portlaoise, Co Laois Laois County Council has granted planning to Marina Quarter Limited for a €33m LRD at Dublin Road, Ballyroan in Portlaoise. The project will consist of 175 houses in a mix of two, three and four-bed units and 20 one-bed apartments as well as a crèche and two ESB kiosks. The Business Post, 1st December

Athlone, Co Westmeath Plans are in the pipeline for a €30m LRD in Cornamaddy, Athlone. The development for Glenveagh Homes Limited proposes more than 170 units in a mix of apartments and houses. A decision is due in early 2024. The Business Post, 1st December

Rathdrum, Co Wicklow Works have begun on a €20.2m residential development in Knockadosan, Rathdrum. The project for Oakway Homes involves the construction of 88 houses and four apartments. Regan Construction has commenced work on the first 19 houses. The Business Post, 1st December

Drogheda, Co Louth Louth County Council has just given the green light to Sionna Homes Ltd for a large residential development on a site which extends to approx. 9.39 acres, on lands at Boyne Road, Drogheda. The €39m project will see the construction of 42 houses in a mix of 22 three-beds, 20 four-bed units and 150 apartments. The latter will comprise 95 two-beds and 13 three-bed apartments. The Business Post, 1st December

Bundoran, Co Donegal Works are to begin imminently on a €10m social housing development at Gort na Gréine, Drumacrin, Bundoran, Co Donegal. The project is being built by Garyaron Homes Limited and includes the construction of 22 houses and 20 apartments. The Business Post, 1st December

Dominick Street Upper, Dublin 7 Fresh plans have surfaced to convert the Hendrons Building, a long-abandoned machinery workshop in Dublin 7, into apartments. The building, a modernist protected structure near the city centre, is owned by developer Eugene Carlyle. An application to redevelop the building into apartments has been filed with Dublin City Council by Phibsborough D7 Development Limited, a firm linked to Cafico International, a financial advisory business. The proposal for the building detailed plans to build a mixed-use development of 93 apartments across three residential blocks. The plans also include a café or retail unit, outdoor seating and a play area. A decision on the proposal by Dublin City Council is expected next year. The Business Post, 28th November

Cleeves Riverside Quarter, Limerick The “masterplan” for a major redevelopment of the former Cleeves factory site, which will see the grounds transformed for residential and commercial use, has been unveiled. Plans for the Cleeves Riverside Quarter development include the construction of up to 290 residential units on the historic industrial site, with scope for a further 275 residential beds for student accommodation. The project – which has been described as the “largest inner-city project ever undertaken in Limerick and one of the largest in the State” – is estimated to cost upwards of €500m, with a commitment of €35m already in place under the Urban Regeneration Development Fund (URDF). Limerick Twenty Thirty, the developer behind the project and a planning subsidiary of Limerick City and County Council, will seek expressions of interest for individual aspects of the plan in the new year. Limerick City and County Council purchased the grounds in 2014 and 2017 for a total of €4.1m. The Business Post, 28th November

Land Development Agency (LDA) The Coalition is close to a deal to provide “up to €3bn” in new funding for the LDA, giving it the firepower to build 5,000-6,000 new homes in the next three years. Although the LDA was set up as a State body to build social and “affordable” housing on public land, it has been criticised for the slow delivery of homes. The new money is approx. half the €6bn mooted when Minster for Housing Darragh O’Brien pushed to deploy a major portion of the State’s corporation tax windfall for social and “affordable” housing. But senior Government sources said the LDA never needed that entire sum in a single swoop, insisting the new package would be enough to fund its work through the early years of a new business plan for 2024-2028. In a deal under discussion at the Cabinet subcommittee on housing, the agency will receive an initial round of funding for 2024 until 2026. Also under discussion is a further injection from the Ireland Strategic Investment Fund, a separate sovereign wealth fund from which the LDA’s first €1.25bn was drawn. With agreement now in prospect on money for 2024-2026, the arrangement assumes the LDA will use such funds to deliver between 5,000 and 6,000 new homes by 2027. That is in addition to the pipeline of just over 3,000 homes committed under the first €1.25bn. The Irish Times, 5th December

Cherry Orchard, West Dublin Plans for more than 700 social and cost-rental homes in Cherry Orchard in west Dublin, in blocks of up to 15 storeys, have been submitted to An Bord Pleanála by the Land Development Agency (LDA) and Dublin City Council. The 547 cost rental and 161 social housing apartments represent the first phase in the development of more than 1,100 homes on a large land bank just north of Park West railway station and to the east of the M50. The apartment scheme is the largest joint project undertaken by the LDA and the City Council to date. The apartments are proposed in 16 blocks ranging in height from four to 15 storeys, with 28 studios, 263 one-bed, 368 two-bed and 49 three-bed apartments. With the Cherry Orchard area dominated by two-storey social housing, the new development is designed with a majority of cost-rental homes for low- and middle-income workers. The Irish Times, 1st December

Housing Construction Builders could complete more than 33,000 new homes in the Republic next year, say European forecasters. Industry forecaster Euroconstruct estimates that approx. 31,000 new homes will be built here this year, boosting Government claims that the final figure will top its 29,000 target. Euroconstruct says that the Republic could build 33,450 new houses in 2024, lending weight to industry and Government predictions that it will be a particularly strong year for residential construction. The organisation, which operates in 19 European countries, says the Republic will be the only one where building will grow strongly next year “up 7.9% during this period”. The Irish Times, 1st December

Peter McVerry Trust Minister for Housing Darragh O’Brien has said there was “no question” that the Peter McVerry Trust would need to be restructured in the future, after the Government had to bail out the homelessness charity. Mr. O’Brien received Cabinet approval this week for up to €15m in “exceptional” emergency funding for the charity, which has been battling a major financial crisis over recent months. The bailout will be paid to the charity in phases between now and March 2024, with the first tranche of approx. €4m to be released this week. There would be “conditions attached” to the State funding, which the Minister said he would lay out in correspondence sent to the charity. The Irish Times, 30th November



Church Street and Hammond Lane, Dublin 7 Plans for the construction of a purpose-built family court complex on a vacant Dublin City site bought by the State approx. 30 years ago have finally been published by the Office of Public Works. The Dublin Family Court complex will be constructed beside the Four Courts on a large derelict site in Smithfield bordered by Church Street, Hammond Lane, Bow Street, and the Red Luas line. The complex of 19 court rooms will replace the existing fragmented facilities for family law at Dolphin House, Chancery Street, Phoenix House and the Four Courts. The building, which will rise to six storeys, will include consultation spaces, staff and judicial accommodation, public waiting areas, space for mediation and domestic violence support services, accommodation for legal practitioners, and custody facilities. The development of the complex, which will rise to six storeys, is expected to cost more than €100m and has been dogged by delays since the site was acquired by the State in the late 1990s. The Irish Times, 30th November

JLL Report Annual returns on direct investment in Irish property recorded the largest decline in more than a decade, a new report from JLL Ireland has shown. The latest JLL Irish Property Index showed that annual returns “experienced a significant drop” of 9.7% YoY in the third quarter of 2023 – the largest decline recorded in the property investment market since the second quarter of 2010, according to the property investment manager. On a quarterly basis, values in the property investment market are down 1.3% in overall returns compared to the previous quarter. The current report assessed a typical institutional investment portfolio worth approx. €647m, which is weighted 53% offices, 19% retail, 15% industrial and 13% residential. The latest JLL analysis shows that that the rate of decline in property valuations QoQ has eased, after investment returns dropped 2.1% in Q2. Further analysis of the sample portfolio used by JLL Ireland showed that the capital value declined by 2.8% QoQ and decreased by 14.7% YoY. Rental values for office sector properties have remained stable across the last four quarters, with no significant changes. Meanwhile, retail’s rental values have recorded the first annual increase for the first time in ten quarters, up 2.5% YoY. The Business Post, 28th November

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