7th June (Issue 49)

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.




Projects Emerald and Ruby: The Irish Times reports that NAMA has received final bids for the loan portfolio Projects Emerald and Ruby, which have a par value of €4.7bn. The bidders reportedly include Oaktree, Cerberus and Lone Star. €750m of the par value of the loan portfolios is secured by 950 residential properties, c. 300 of which are currently vacant. The Irish Times, 3rd June


Project Abbey: NAMA is expected to select a preferred bidder for the €650m par value Project Abbey loan portfolio in the near future. The current bidders are believed to include Apollo, Oaktree Capital and a joint bid from Deutsche Bank and Davidson Kempner. The portfolio reportedly includes loans secured by the Park West retail, office and leisure complex in west Dublin. According to market sources, the portfolio is expected to sell for less than half of its par value. The Irish Times, 3rd June



DFS Limerick: Colliers International has set an asking price of c. €3m for a retail unit let to the furniture retailer DFS on Ballysimon Road in Co. Limerick. DFS is paying an annual rent of €225k on a lease which has c. 14.4 years remaining. The three-storey unit has a floor area of 22,118 sq. ft. and sits on a 1.4-acre site. The Irish Times, 1st June



Blocks JK: Offers in excess of €21m are being sought by Weir Conway Chartered Surveyors for two office blocks in Eastpoint Business Park in the Dublin docklands. Blocks JK were developed in 2001, have a combined floor area of 63,272 sq. ft. spread over three floors and also provide 110 car spaces. The blocks have been let to Arvato Finance Services on a 15 year FRI lease from April 2016 at an annual rent of €1.4m. The rent equates to c. €20 psf for the office space and €1k per car space. Arvato has been in situ as sub-tenants since 2008 and has already spent over €5m refurbishing the blocks. A recent feasibility study also concluded that Blocks JK could provide additional floor space of 20,000 – 35,000 sq. ft. through adding an additional storey and extensions to the rear. The Irish Times, 1st June

Sharp Building: HWBC and Knight Frank have been retained by the developers McGarrell Reilly Group to source tenants for the Sharp Building on Hogan Place in Dublin 2. The property is set to undergo a €20m renovation which will see the majority of the existing structure demolished and replaced with a new six-storey block. The average floor plates of the new block will be c. 8,600 sq. ft. and it will have an A3 energy rating. The Irish Times, 1st June

Setanta Centre: Larry Goodman is understood to have agreed the sale of the Setanta Centre on Nassau Street in Dublin 2 to a group of Middle Eastern Investors for over €100m. While the property was never officially on the market, it was believed to be the subject of numerous offers, primarily due to its development potential. With a large surface level car park in the centre of the property, a substantial portion of the property was never built on. The Irish independent, 1st June


Fitzwilton House: IPUT has been granted planning permission by Dublin City Council to redevelop Fitzwilton House in Dublin’s Grand Canal. The application proposes that the existing 1960s property is demolished and replaced with a new c. 187,000 sq. ft. eight storey block in a €45m redevelopment. The development will also provide 44 car spaces and 178 bicycle spaces. IPUT hope to commence work on the site in 2017 and complete by mid-2019, however these dates could change if their application is appealed to An Bord Pleanála. The Irish Times, 7th June


Dublin 2 Development: The OPW and receivers acting on behalf of NAMA have sought planning permission from Dublin City Council to develop 400,000 sq. ft. of office space on Tara Street in Dublin 2. The application proposes that the existing buildings on the site, which include Apollo House and Hawkins House, are to be demolished to facilitate the development. According to The Irish Times, the cost of the development is projected at €50m. NAMA Wine Lake, 5th June


Office Market Transactions: A new report from Savills has revealed that c. 27% (c. 10.7m sq. ft.) of the total office space in the Dublin market has been transacted since the start of 2013. The substantial volume of transactions was partly driven by the disposal of properties associated with non-performing loans, while the growth in services employment has also led to strong demand for space from owner-occupiers. The Irish Independent, 7th June



Maldron Hotel: DTZ is guiding €6m for the Maldron Hotel located in Cork City. The three-star, 101-bed hotel is currently undergoing a €2m refurbishment by its operator, Dalata, who are in situ until 2030. The rent Dalata pay is based on a combination of a flat fee (€400k p.a.) and a percentage of turnover. In 2015 the total rent paid by Dalata amounted to c. €535k. The hotel was developed by Tom Coyle and is being sold under the instruction of the receiver, Aiden Murphy of Crowe Horwath. The Irish Times, 1st June


Fitzpatrick Hotel Portfolio: The Irish Independent reports that CBRE has made three Dublin hotels operated by Fitzpatrick Lifestyle Hotels available for sale. The hotels are the Spencer Hotel in the IFSC, the Morgan Hotel in Temple Bar and the Beacon Hotel in Sandyford. While the hotels are not yet officially on the market, their combined price tag is projected at €130m. The Spencer Hotel was purchased by Patron Capital in late 2013 for c. €33m, with Fitzpatrick Lifestyle Hotels also understood to have provided equity to complete the deal. The Pyramid Hotel group acquired the Morgan Hotel for c. €30m two years ago. The Irish Independent, 2nd June


Cahernane House Hotel: The Prem Group has been chosen as the preferred bidder for the four-star, 38-bed Cahernane House Hotel in Killarney, Co. Kerry. The group is expected to pay c. €3m to acquire the hotel, which sits on a 6.5-acre site and is c. 2km from Killarney town centre. The current owner of the hotel is the Browne family. The Irish Independent, 2nd June


Dalata Transactions: Dalata has announced that they have agreed to acquire the freehold interest in the Clarion Hotel Limerick for €8.5m. Dalata already own the leasehold interest in the four-star, 158-bed hotel and intend on rebranding the hotel as a Clayton hotel by the end of 2016. Dalata has also confirmed that they have completed two transactions which has seen them acquire hotel sites at Beasley Street in Cork (€10.2m) and Kevin Street in Dublin (€8.1m). The Irish Times, 7th June


Amaris Hospitality: The hotel group Amaris Hospitality has unveiled a c. £23.7m capital investment plan which will see 237 rooms added to the group’s portfolio. The c. £23.7m is to be apportioned over three hotels. Approximately £10m is to be spent adding 85 rooms to the Hilton Garden Inn Custom House hotel (formerly Jurys Inn) in Dublin’s IFSC. A further c. £8m is to be spent adding 80 rooms to Jurys Inn Belfast while the third hotel to be extended is Jurys Inn in Oxford, where c. £5.7m will be spent adding 72 rooms. Amaris Hospitality is owned by Lone Star and the group already has over 13,500 rooms in its portfolio. The Irish Independent, 7th June


Oakmount Hotels: Last week Oakmount was granted planning permission to develop two new hotels in Dublin. An Bord Pleanála approved their application to develop a five storey hotel at 117-119 Ranelagh Road. Oakmount also received approval from Dublin City Council to convert a warehouse in North Wall Quay into a seven-storey, 93-bedroom hotel. The key individuals behind Oakmount are Paddy McKillen Junior and Matt Ryan. Sunday Business Post, 5th June



Dublin 4 Student Accommodation: Ziggurat Student Living has retained Savills to manage the sale of the former Montrose hotel near UCD in Dublin 4 for c. €40m. The former hotel now operates as a 192-bed student accommodation complex where rooms are priced between €245 and €300 per week. Ziggurat acquired the former hotel in 2012 and spent c. €22.5m converting the property into student accommodation. The Sunday Times, 5th June


Dublin Apartments: Receiver Peter Stapleton of Lisney has retained agents Hooke & MacDonald to sell 98 apartments spread across four developments in Dublin City. The most valuable block is The New Maltings in Dublin 8, where 47 apartments are for sale for €7m (c. €149k each). The second set of apartments for sale is 16 of the 18 apartments at 46 – 47 Cork Street in Dublin 8, which are guiding €2.9m (c. €181k each). The third set of apartments for sale is 15 apartments at 31-35 Middle Gardiner Street, Dublin 1, which are guiding €2.7m (c. €180k each). The final block is 20 of the 41 apartments from The Ice Rink development in Dolphin’s Barn in Dublin 8, which have an asking price of €2.5m (c. €125k each). When compared to market rents, all four blocks are under-rented. The Irish Times, 1st June


Mortgage Approvals: Figures from the latest Banking & Payments Federation Ireland (BPFI) report show that the number of mortgages approved for the three months ending April 2016, based on moving averages, was 2,307. This figure was 1.9% below the 2,352 approved for the period ending April 2015, however it was 18.7% above the three month moving average for March 2016 (1,944). The value of mortgages approved for the period ending April 2016 was €443m, compared to €442m for April 2015 and €370m for March 2016. The BPFI report also suggests that an increasing number of mortgagees are switching lenders, as the number of switchers in the period ending April 2016 was 76.6% above the April 2015 figure. Banking & Payments Federation Ireland Mortgage Approvals, February 2016


Apartment Heights: Dublin City councillors have elected to increase the maximum height of apartment blocks in the ‘low-rise’ areas of Dublin City from 19m to 24m. Developments of 24m will allow for eight storey blocks to be built in most areas of Dublin city, an increase of two storeys from the previous maximum height. While the majority of Dublin city is designated as ‘low-rise’, nine areas allow for ‘mid-rise’ developments (up to 50m) and four areas allow for ‘high-rise’ developments (over 50m). The four ‘high-rise’ areas are the Docklands, George’s Quay, Connolly and Heuston. The Irish Times, 1st June


Monard Cork: An Bord Pleanála has approval a proposal from Cork County Council to develop a new town in Monard, north Cork, which will have a population of up to 13,000. The scheme will involve the development of four villages and a town centre over 966 acres, the majority of which is greenfield agricultural land. Monard is located c. 4km northwest of Blackpool and c. 4km northeast of Blarney village. To facilitate the development, a new railway station will be developed along the Cork-Mallow rail line. An Bord Pleanála’s approval means that no appeals can be lodged against planning applications submitted by developers for Monard, provided that the application is in line with the council’s proposal. The Irish Times, 2nd June



Ashurst Service Station: JLL is guiding €10m for a service station let to an Applegreen subsidiary in Mount Merrion, Co. Dublin. The property is let to Petrogas Group Ltd under a lease which has a mutual break option in 2025, thereby offering investors c. 9 years of secure income. Based on the €10m guide price and the current rental income of €700k p.a., the investment offers an initial return of c. 6.7% once purchaser’s costs are deducted. Under the terms of the lease, the annual rental income rises to €840k in July 2019, €1,008k in July 2024 and €1,210k in July 2029. The size of the site is 0.64-acres. The Irish Times, 1st June
Airside Motor Park: Savills is quoting €2.5m for a motor showroom at Airside Motor Park in Swords, Co. Dublin. The property includes a 21,409 sq. ft. building and a forecourt which can accommodate approximately 150 cars. The property is let to Citroen Motors Ireland Ltd under a 10-year lease from September 2011, at an annual rent of €165k. The Irish Times, 1st June


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