6th October (Issue 15)
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.
LOAN / PORTFOLIO
Project Clear: Ulster Bank is set to launch the sale of Project Clear, a loan portfolio secured by land banks which have a value in excess of €500m. The land banks are spread across Ireland and include sites in Dublin, Cork and Galway. The portfolio is to be sold in three tranches and prospective buyers will not be able to bid for the portfolio as one transaction in its entirety. The deadline for bids is expected to be before the end of October. The Sunday Business Post, 4th October
The Spire Portfolio: D2 Private, who earlier this year purchased Clerys department store in Dublin city centre, is believed to have been chosen as the preferred bidder for The Spire Portfolio. The portfolio has a guide price of €10m and consists of a mix of properties on O’Connell Street and Abbey Street. The mixed use properties have a total floor space of 40,000 sq. ft., with tenants including Ladbrokes and Londis. The properties are owned by Markland Holdings, whose debts are controlled by NAMA. The properties however, are not in receivership and the sale is being conducted on a consensual basis. The Sunday Times, 4th October
OFFICE
Cumberland House: Twitter are to move into Cumberland House in Dublin 2 after agreeing terms on a 20 year lease (break options in years 12 & 15) with Hibernia REIT. Twitter will occupy 85,000 sq. ft. of the 112,000 sq. ft. property while also leasing c. 140 car spaces. The total rent will be c. €4.6m p.a., with the office space being let at c. €50 psf. Hibernia acquired Cumberland House for c. €49m earlier this year and will spend up to €27m renovating the property before Twitter’s lease commences in H2 2016. The Irish Times, 1st October
New NTMA Offices: The NTMA have reportedly chosen to vacate their existing offices on Grand Canal Street in favour of the Project Wave site on Dublin’s North Wall Quay. Singaporean real estate firm Oxley and Sean Mulryan’s Ballymore Properties purchased the Project Wave site from NAMA in 2014. The new owners have recently lodged a planning application for c. 538,000 sq. ft. of office and commercial space as well as 250 apartments. The NTMA are expected to commence talks with the owners shortly and hope to move in late 2018 if a deal can be agreed. The Irish Times, 1st October
1 Grant’s Row: Aviva Life & Pensions have been chosen as the preferred bidder for a multi-let office building at 1 Grant’s Row off Lower Mount Street in Dublin city centre. The property fund are to pay c. €8.3m for the 15,244 sq. ft. property which is currently producing an annual rental income of c. €482k. There are currently four tenants in situ and the next rent review is in 2016. The property was sold by JLL under the instructions of receiver Ken Tyrrell of PwC. The Irish Times, 30th September
HOTEL
Radisson Athlone: CBRE are handling the sale of the four star, 128-bed Radisson Blu Hotel in Athlone on behalf of the receiver Kieran Wallace. While CBRE have not put a guide price on the hotel, industry sources believe the hotel will sell for c. €6.5m. The hotel was developed in 2004 and is in a prime location opposite Athlone Castle in the town centre. Trading has been strong for the hotel which has been kept in good condition in recent years. The Irish Times, 30th September
Clyde Court Hotel: The Clyde Court Hotel in Ballsbridge is to close at the end of the year after the owners, Chartered Land and the Abu Dhabi Investment Authority, exercised their break option in the lease. The hotel is to be replaced by 190 apartments, for which construction is to begin in early 2016 with the apartments available to purchase from 2017. The nearby Ballsbridge Hotel, which Chartered Land and the ADIA also own, will remain open until at least April 2018 after its operator, Dalata, extended the lease. The Irish Times, 30th September
Hotel Extensions: The five star Dylan hotel on Eastmoreland Place in Dublin 4 has sought planning permission for a 26 room extension, which would bring the total number of rooms to 70. The hotel was developed by Seamus Ross of Menolly Homes and the application was submitted by the operator of the hotel, Lyndonmount. Nearby The Fitzwilliam Hotel on St Stephen’s Green has also sought an extension to a previous planning application, which approved a 34 room extension of the hotel. The Sunday Times, 4th October
RETAIL
Whitewater Shopping Centre: Joint agents Savills and Coady Supple have been chosen to manage the sale of the Whitewater Shopping Centre in Newbridge, Co. Kildare. The c. 296,000 sq. ft. shopping centre, currently owned by Ballymore Properties and Elm Holdings, is expected to sell for over €150m. A sales price of €150m would reflect a net initial yield of c. 7.5%. The centre opened in 2006 and boasts more than 70 tenants, including Debenhams and Marks & Spencer.The Irish Times, 6th October
Irish Life: Irish Life has spent c. €19.2m acquiring two amalgamated shops at 57 / 58 Grafton Street in Dublin. Life Style Sports currently occupy the property and are paying rent of €675k p.a., which is guaranteed by the retailer’s parent company, Stafford Holdings Ltd. The investment will offer an initial yield of c. 3.4% once purchasing costs have been deducted. The four storey over basement building comprises 12,400 sq. ft. of floor space, of which over half is suitable for retail use. Irish Life has now spent c. €650m on Irish property over the past two years. The Irish Times, 30th September
RESIDENTIAL
Daft.ie Property Report: The latest house price report from Daft.ie shows the different trends in the Irish market over the past quarter. In Q3 2015, the average asking price in Dublin fell by 1.4%, while outside of Dublin the average asking price rose by 3.9%. The largest increases were recorded in Limerick city (7.7%) and Cork (6.8%). Daft.ie economist Ronan Lyons believes that the decrease in prices in the most expensive areas is reflective of the introduction of the Central Bank’s new mortgage lending criteria. The Irish Times, 6th October
11 Shrewsbury Road: Knight Frank are guiding €10.5m for Fintragh, 11 Shrewsbury Road. The 5,700 sq. ft. residential property is located on a c. 0.7 acre site and boasts an outdoor swimming pool and tennis court amongst its key features. With seven bedrooms upstairs, Fintragh would be attractive as a family home whilst also offering embassy potential. The Assaf family own the property through an investment vehicle, Pennyvale Property, having purchased Fintragh in 1987. The Irish Times, 1st October
CSO Property Prices: New figures from the CSO reveal that national residential property prices rose by 2.3% in August, representing the largest jump in a calendar month since last October. On a national level, residential prices have now risen by 9.5% in the past year. Property prices outside of Dublin grew by 10.8% in the past year, surpassing the 8.2% growth rate in Dublin. Despite this increase, prices remain 35% below their peak in 2007. Goodbody Stockbrokers estimate that the national average sales price for a property is now c. €215k, well below the average in Dublin of c. €288k. Economists believe that an improving economy and continued shortage of supply are the primary factors behind the continued increase in prices. The Irish Independent, 1st October
St Augustine Apartments: Savills are guiding in excess of €22m for 110 apartments at 42 – 76 St Augustine Street, Dublin 8. The guide price reflects an average valuation of €200k per apartment, with the block consisting of 77 two-beds, 21 one-beds and 12 three-beds. One of the most appealing aspects of the investment is that the entire block has been let to rental company Staycity, therefore the investment will require minimal asset management. Staycity are currently paying rent of €1.3m p.a., with eight years left on the lease. The Irish Times, 30th September
OTHER
Commercial Market Overview: On a quarterly basis, the value of completed commercial property transactions (excluding loan sales) has fallen by almost 50% between Q1 2015 and Q3 2015. In Q1 2015 there were c. €1.03bn worth of transactions completed, decreasing to c. €665m in Q2 and c. €530m in Q3. Based on current figures, the total value of commercial property transactions in 2015 should fall short of the 2014 figure, when nearly €5bn worth of transactions were completed. The Irish Independent, 3rd October
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