Donnybrook, Dublin 4 A consortium of private investors based in the west of Ireland has paid c. €6.5m for the Donnybrook Mall in Dublin 4. Acquired by developer Sean Dunne for €17m at the height of the last boom, the mall last changed hands in 2014, with its outgoing owner, an individual private Irish investor, paying €6.6m to secure ownership of the 15,590 sq. ft property. On this occasion the scheme was offered to the market by Lisney last September at a guide price of €6.8m. The buyers are believed to have secured the property in the face of competition from a number of parties. The mall’s new owners will have the benefit of immediate rental income of €450.3k pa from a tenant line-up which includes Tesco, Lloyds Pharmacy and Abrakebabra. The Irish Times, 25th January
Greystones, Co Wicklow The Meridian Point retail scheme and its 180-space car park are being offered to the market on behalf of the Cosgrave Property Group by agent Avison Young at a guide price of €5.5m (NIY 9.64%). The development comes fully occupied with a strong tenant line-up which includes Sports Direct and Costa Coffee. Meridian Point comprises 20 tenancies in total made up of a mix of uses. The net rent receivable is €582.8k pa with a WAULT of 7.05 years to lease expiry and 5.24 years to lease break. The Irish Times, 25th January
Botanic Avenue, Dublin 9 A property agency that charges students €720 a month to share a room with three other people has been refused permission to expand one of its Dublin developments. The Hazelwood Student Village on Botanic Avenue in Dublin 9 is an amalgamation of two homes that have been renovated to create 28 student bedspaces across 13 rooms. The rent for a bedspace in a room with four single beds is €720 a month. In another room with two double beds, each tenant is charged €1,040 a month per bed. Last year, Hazelwood Walk Holdings Limited applied for permission to expand the Botanic Avenue development and create two new rooms for beds. The two properties on Botanic Avenue were acquired for €1.8m in 2021. Based on rents being charged for bedspaces in Botanic Avenue, the landlords could expect to earn €294k (c.16% yield) in rent each year from the property. The Business Post, 25th January
M7 Real Estate Amsterdam-based investor M7 Real Estate has completed the acquisition of a portfolio of office and industrial assets in the Netherlands and Ireland for €160m. The deal was made on behalf of the firm’s sixth value-add European investment fund, M7 European Estate Investment Partners VI (M7 EREIP VI), which is now fully invested. The portfolio consists of 20 assets totalling 1.5m sq. ft split between 667.3k sq. ft of industrial properties and 785.7k sq. ft of offices in Dublin, Den Bosch, Eindhoven, Groningen and Rotterdam. React News, 24th January
Mulhuddart, Dublin 15 Amazon has lodged plans for three new data centres at its data centre campus to the north of Mulhuddart in north Dublin. This would bring to six the total number of data centres on the site. An Environmental Impact Statement lodged with the new plan stated that permitted development and future indicative development at the data campus will consume 219.7MW in power and produce 607.5k tonnes of CO2 per year. The Irish Times, 25th January
Earlsfort Terrace, Dublin 2 US-headquartered investor KKR is closing in on a deal to rent just under 50,000 sq. ft of office space at Intercom’s new headquarters on Dublin’s Earlsfort Terrace. Although heads of terms have yet to be agreed between the parties, according to market sources, KKR is intent on occupying the top three floors of the newly-developed Cadenza building. Should the deal proceed Intercom will assign part of its lease with the building’s owner, Irish Life, to the global investment firm. Intercom agreed to pre-let the entire building (110,868 sq. ft) on an 18-year lease prior to the arrival of Covid-19 in December 2019. The Irish Times, 25th January
Harcourt Street, Dublin 2 Hibernia Real Estate Group has commenced the “soft strip” element (removal of the internal fit out and all services) in preparation for the demolition of the former Garda Dublin regional headquarters at Harcourt Square. The demolition, which is expected to get under way by the end of February, will clear the way for the developer to deliver a new headquarter office for KPMG. John Paul Construction has been appointed as the main contractor for the project and is now established on site. The new office complex, which is scheduled for completion in February 2026, will be capable of accommodating more than 3k of KPMG’s Dublin-based workforce. The Irish Times, 25th January
St Stephens Green, Dublin 2 An Bord Pleanála has given permission to US property giant Kennedy Wilson to construct a new office campus at St Stephen’s Green in Dublin that will have the capacity to accommodate 3k office workers. The site at Stokes Place at St Stephen’s Green South and Harcourt Street currently accommodates the Dublin headquarters of KPMG and the new proposal involves the demolition of the existing office complex and the construction of an eight-storey office block. Plans were first lodged for the scheme in January 2021 and Dublin City Council approved them in September that year despite local opposition. In allowing the project, the council ordered the omission of one of its floors due to visual impact concerns. The Irish Times, 25th January
Residential Zoned Land Tax As part of the government’s flagship Housing for All policy, the Residential Zoned Land Tax, levied at 3 per cent on a site’s market value, will come into force next year. Approximately 10,000 hectares of serviced residential development land has been identified within the scope of the tax, which could yield more than €300 million a year.
The tax is designed to counter “hoarding and speculative behaviour” in the Irish property market, which has been highlighted by government research. The tax will come into effect in February 2024, with owners of land on the register charged 3 per cent based on the market value of each site. The state is preparing a register that will identify the landowners who will be subject to the tax.
Across more than 100 documents sent to local authorities last month, housebuilders and landowners claimed the new tax will exacerbate affordability issues in the Irish housing market and make more sites unviable to build on. Conor O’Connell, Director of housing and planning at the Construction Industry Federation, told the Business Post the organisation welcomed the principles of the tax, but said the unintended consequences of the measure needed to be acknowledged by government. The Business Post, 29th January
Kentstown, Co Meath Knight Frank is seeking offers in excess of €3.5m for a greenfield site with planning permission for 86 houses (c€41k per site) in Kentstown, Co Meath. Extending across a total area of 8.87 acres, the lands come for sale with full approval from Meath County Council for the construction of a new-homes scheme to be delivered in two phases. Phase one comprises 38 houses while phase two comprises 48 houses and a creche. The houses comprise a mix of four two-beds, 64 three-beds and 18 four-bedroom units. The Irish Times, 25th January
Newbridge, Co Kildare Developers and investors involved in the delivery of new homes in Dublin’s commuter belt counties will be interested in the opportunity presented by the sale of a 8.81-acre greenfield site at Old Connell in Newbridge, Co Kildare. The site, which has potential to accommodate 126 homes, is being offered to the market by agent Avison Young on behalf of the Dominican Order at a guide price of €5m (€568k per acre). The Irish Times, 25th January
Blackrock, South Co Dublin Bartra property group has secured €4.15m from the off-market disposal of a prime residential development site at Woodlands Park in the south Dublin suburb of Blackrock. Located off Mount Merrion Avenue, the 0.72-acre site, which has full planning permission for 26 apartments (c€160k per site), has been acquired by Red Rock Developments. While the house was not publicly advertised for sale, an examination of the Property Price Register shows that Bartra paid €4m for it in 2018. The scheme also provides for 26 surface car-parking spaces. Having secured approval for this development, Bartra subsequently sought permission for a revised scheme comprising 38 build-to-rent apartments aimed towards the “later living” or retirees’ market. While this proposal received the green light from Dún Laoghaire-Rathdown County Council last October, it remains the subject of an appeal to An Bord Pleanála by local residents. The Irish Times, 25th January
Drumcondra, Dublin 9 Construction of 1,592 apartments in Drumcondra in Dublin has been blocked by the High Court due to flaws found in its planning permission. Permission for the €602m build-to-rent scheme, comprising studios, one-beds, two-beds and three-beds, was granted in November 2021 to the Irish arm of US real estate giant Hines.
The 12 apartment blocks, ranging in height from two to 18 storeys, was to be built on the site of the former Holy Cross seminary, on Clonliffe Road. Ruling on her judicial review action today, Mr Justice Richard Humphreys said An Bord Pleanála failed to follow the required approach to assessing a development’s impact on a protected structure. The Irish Times, 27th January
Housing Targets Unpublished research by the Housing Commission says Ireland may need up to 62k homes built per year until 2050 to meet demand – c. double the annual target in the Government’s master plan for this decade. The research, which was shared with Minister for Housing Darragh O’Brien in November last year, indicates that Ireland requires between 42k and 62k new homes every year – under Mr O’Brien’s Housing for All strategy, 33k is the average annual target in the period to 2030. With population growth consistently at the upper end of official projections due to higher migration, it finds that since 2017, migration has been more than 10% above the high-migration scenario – even excluding recent arrivals from Ukraine. Population alone, the Minister was told, is likely to drive the baseline requirement for houses to between 35k and 40k pa. Obsolescence in the housing stock built before 2022 suggests a further requirement of 7k-17k homes pa. The Irish Times, 26th January
Housing Completions 2022 Figures from the CSO show new dwelling completions totalled c. 30k in 2022, an increase of 45% on the previous year. This was the highest level of residential construction seen in the State since the Celtic Tiger era and was significantly ahead of the Government’s Housing for All target of 24.6k units for 2022. New home completions in the final quarter of last year totalled c.9.1k, a rise of over 31% on the same period in 2021. The full-year total was boosted by a major increase in apartment completions, which rose by 79% to c. 9.1k. There was c. 15.1k scheme dwelling completions in 2022, up 42% from 2021, while 5.5k single dwellings were completed, a rise of c. 17%. Just over 50 per cent of the completions last year were scheme dwellings, a further 30.7% were apartments and 18.5% were single dwellings. A geographical breakdown of the figures shows c. 60% of completions in 2022 were in Dublin or the Mid-East (Kildare, Louth, Meath, and Wicklow). The Government’s projected target for 2023 is 29,000. The Irish Times, 25th January
JLL Irish Property Index, which JLL has undertaken since 1969, measures returns on direct investment in property and represents a typical institutional investment portfolio. The portfolio, worth approximately €720m, is weighted 56% Offices, 17% Retail, 13% Industrial, and 14% Residential. The JLL Irish Property Index Overall Returns decreased by -3.1% during the quarter. This is the second consecutive quarter to record negative returns. The last time two consecutive quarters had negative returns in 2011. Capital values declined by -4.4% quarter-on-quarter (q-o-q) and decreased by -4.4% year-on-year (y-o-y).
Three of the four sectors had falling annual capital values, with industrial being the only sector showing growth by +1.5% yoy. Office capital values fell by -6.7%, the sector’s first yearend annual decline since 2012. This was a result of outward yield movement. Retail’s capital values fell by -4.3% making it the fourth consecutive year for the sector to have annual declines. Finally, residential’s capital values fell by -0.5%, the first annual decline for the sector since it was added to the index in 2019, again due to a marginal yield increase. JLL Q4 2022 Property Index Report
Commercial Real Estate Sector Pipeline More than 45k homes are stuck in the planning system, according to a report by construction consultants Mitchell McDermott. A further 28k have approval but no work has yet begun on building any of them. The figures account for close to three years’ worth of the Government target for residential construction across the State. The Mitchell McDermott figures suggest 28k homes were built last year, of which one-third were apartments. The report finds that the construction costs of a two-bed mid-range apartment rose by 9.6% last year. Mitchell McDermott found that the hard costs of building a two-bed, medium rise suburban apartment is now over €240k. Once other costs such as the provision of parking, siteworks, VAT and profit margin are included, the average cost of a suburban mid-rise two-bed apartment is €460k. For the construction industry, costs jumped 12% in 2022. The Irish Times, 26th January
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Dawson Street, Dublin 2 Irish property investment group Tetrarch Capital has instructed agent CBRE to find a buyer for the Dawson Hotel which is being offered to the market at a guide price of €17.5m. The subject property briefly comprises 36 bedrooms (currently closed) along with extensive food and beverage outlets at ground-floor level. The Irish Times, 18th January
Maynooth, Co Kildare The Carton House hotel resort in Co Kildare returned to operating profit in 2021 as revenues more than doubled to €8.94m “following a strong recovery from the pandemic”. New accounts for the Belmullet Hospitality Group Ltd that operates Carton House Hotel, Golf and Spa Resort in Maynooth, Co Kildare, show that the business recorded operating profits of €81k in 2021, following an operating loss of €3.1m in 2020. Revenues increased by 110% from €4.25m to €8.94m as the business was able to reopen and relaunch in early June 2021 as Covid-19 restrictions eased. The business recorded a pretax loss of €2.38m in 2021 after non-cash depreciation costs of €1.69m and interest payments of €767.5k were taken into account. This loss was down on the pretax loss of €14.5m for 2020 which took account of a non-cash write-down in property of €10m. The 2021 operating profit takes account of Government grants of €2.52m. The Irish Times, 19th January
Licensed Premises Review and Outlook According to Lisney’s Licensed Premises Review and Outlook report, transactional activity witnessed in 2022 was more in line with the 10-year average following the exceptional peak witnessed in 2021. 2022 witnessed 23 transactions completed with a combined value of €51.48m. The most significant change witnessed in the 2022 Dublin market was the reduction in activity of Private Equity (PE) purchasers. Having been extremely active in 2021 and accounting for 37% of volume and 73% of value, PE only factored in one Dublin transaction in 2022. Notably, Publican purchasers re-emerged as the forerunners of the 2022 market accounting for 48% of volume and 37% of value. This compares to 37% of volume and 15% of value in 2021 and is illustrative of increased operator confidence in the sector. The Investor category also witnessed significant uplift with percentage of volume increasing from 10% to 39% and percentage of value rising from 5% to 36% in 2022. In general terms, demand for good city premises remained strong and was illustrated through the recent sales of O’Donoghue’s Suffolk Street, Nancy Hand’s Parkgate Street and The Flowing Tide Middle Abbey Street, all acquired by established publican purchasers. Lisney Report, 20th January
Camden Street, Dublin 2 Developer Charles O’Reilly Hyland has paid c. €9m to secure ownership of a 0.3-acre site with development potential in Dublin city centre. Located immediately to the west of Camden Street, 12 Camden Row is home currently to a 18,299 sq. ft building, which is occupied under a series of licence agreements. Taken together, these delivered a gross operating income of c. €704.1k in 2021 based on a current occupancy rate of 66%. The site was offered to the market by agent Savills at a guide price of €9.5m in May of last year. The Irish Times, 18th January
Lord Edward Street, Dublin 2 Paris-headquartered investor Remake Asset Management has made its first acquisition in the Irish property market, paying €9m for an office investment in Dublin city centre which was guiding €8.8m. The subject property – 14-16 Lord Edward Street – comprising 14,156 sq. ft of office space distributed across nine suites, is fully let and producing €589.5k in annual rental income. 68% of the passing rent is derived from local authority/government-backed occupiers. The office tenants include the Irish Film Board, Dublin City Council, Gradireland and Heneghan Peng Architects. With a stable cash flow in place and a WAULT of just under five years, Remake stands to secure a return of c. 6% on its investment. The sale of the property comes just over seven years on from its acquisition for €7.1m by its outgoing owner, an American investor. The price paid on that occasion represented a 16% premium on the building’s then guide price of €6.1m. At the time the investment had a WAULT of 2.09 years and a total rental income of €457.9k pa. The Irish Times, 18th January
Harcourt Street and Northumberland Street, Dublin Murphy Mulhall is guiding prices of €2.7m and €1.35m respectively for two period office properties in Dublin’s Georgian core. In the case of no. 15 Harcourt Street, the prospective purchaser stands to secure immediate rental income of €137.2k pa. The premises briefly comprises a four-storey over-basement Georgian office property which extends to a NIA of 4,943 sq. ft.
No. 40 Northumberland Road comprises a three-storey over-garden-level period property of 1,970 sq. ft and is located close to the junction with Haddington Road in Dublin 4. The ground and first floors are let on a short-term licence producing €60k pa, while the lower-ground floor live/work unit is currently vacant. The Irish Times, 18th January
Dublin City Centre The founder of the State’s largest waste company, Beauparc Utilities, has agreed a €40m deal which will see him acquire Victoria’s Secret’s flagship store on Grafton Street along with supermarket giant Tesco’s premises on Lower Baggot Street. Eamon Waters is understood to have agreed to pay sums of €28m (NIY 5%) and €12m respectively to secure ownership of the two buildings from Irish property company, Iput. In the case of Victoria’s Secret’s premises at 28-29 Grafton Street, the global lingerie chain is understood to have committed to an annual rent of €1.5m for the remaining 10 years of its lease. Iput had acquired the building in 2012 from the ESB Pension Fund for c. €20m as part of a larger transfer of property investments to the fund. The building comprises c. 20,000 sq. ft of retail space at ground, basement and first-floor level as well as c. 10,000 sq. ft of storage on the two upper levels.
The Tesco premises at 15-16 Baggot Street Lower meanwhile briefly comprises a grocery convenience food store on the ground floor, with a shop trading area extending to 5,988 sq. ft. While the grocery store is fully occupied by Tesco itself, the retailer has sublet the upper floors of the building to gym operator Flyefit while a three-storey mews building to the rear has been sublet to XS Direct. While the Baggot Street property had been advertised publicly for sale by Savills at a guide price of €12.8m, the disposal of the Victoria’s Secret store was handled by the same agent on an off-market basis. The Irish Times, 23rd January
Swords, North Dublin French investor Iroko Zen has paid just under €18m (NIY 6.75%) to secure ownership of South Quarter Airside near Swords in north Dublin. Located across from Airside Retail Park, the scheme owned by Irish Life, Iput, and its original developer, David Daly, comprises two four-storey multi-let buildings extending to an overall area of 90,685 sq. ft and 230 car-parking spaces on a site of 1.65 acres. Extending to 57,079 sq. ft, Block A at South Quarter Airside now contains a newly developed remote broadcast and content production centre (RBC) and a mix of six retail/restaurant units. Riot Games occupies Block A on a new 15-year lease at a passing rent of €600k pa stepping up to €650k in year three with a CPI-indexed rent review at year five. Other tenants in Block A include Hogs & Heifers, Pizza Dog, Indigo Pearl and O’Briens with a combined rent of €287.5k pa. There is a WAULT to break of c. nine years and over 14 years to expiry. Block B comprises a four-storey building extending to c. 33,605 sq. ft and is let in its entirety to Flyefit on three separate leases producing an income of €445k pa. Combined, Airside South Quarter provides an attractive WAULT to break of over 10 years with c. 13.4 years to expiry. The Irish Times, 18th January
Clondalkin, Dublin 22 Guiding at a price of €7.9m (NIY 7.31%), Unit AF40 at Cloverhill Industrial Estate is being offered to the market by Harvey by way of sale and leaseback. The subject property extends to 85,935 sq. ft on a site of 5.56 acres and comes with the benefit of a new 15-year FRI lease to Alucraft Limited, with a guarantee provided by its parent company, the Clarison Group. The lease will incorporate a tenant-only break option at the end of year 10. The rent will step from €635k pa in years 1-5, to €698.5k pa in years 6-10, reverting to a CPI-linked cap-and-collar structure of 3% and -0.5%, compounding annually in years 11-15. The company has invested extensively in Unit AF40 since it moved there in 2012, and its intention during the term of the lease is to construct a new building, subject to planning permission, of c. 6,620 sq. ft within the site grounds. The Irish Times, 18th January
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Ballymount Cross, Dublin An opportunity to buy a vacant warehouse close to the M50 is being offered to the market. Unit 6A Parkway Business Centre, Ballymount Cross, Dublin, extends to 23,214 sq. ft and sits on a 0.79-acre site. Savills is quoting €3.25m for a private treaty sale on behalf of PWC which is acting as a receiver. The Irish Independent, 19th January
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Roundwood, Co Wicklow A ready-to-go housing development site in Roundwood, Co Wicklow, is being offered for sale with a €2m guide price. Located at Djouce Meadows, the 2.41-acre site comes with full planning permission for 20 dormer-style houses. They would comprise two two-bedroom semi-detached houses, 15 three-bedroom semis and three four-bedroom detached houses. The property is situated 500m from Roundwood village, which provides local amenities and services. Dublin city centre, which is located 35 km north of the property, is accessible via the N11 motorway. The Irish Independent, 19th January
Residential Development Developers in Ireland may repurpose commercial buildings and offices as homes to speed up the delivery of housing, according to CBRE, the commercial real estate services and investment firm. CBRE said that the repurposing of commercial properties has become a significant feature in other markets and could become more prevalent in Ireland as the country is “massively under-supplied across all housing tenures.” The company’s 2023 Market Outlook said, however, that there are also “significant” concerns about the viability of apartment building as construction and financing costs increase. Higher financing costs will “impact new dwelling completion numbers over the medium-term” with smaller developers in particular likely to find it difficult to deliver new stock, according to the research. Demand for rental accommodation will be “resilient” this year and likely support average rent price increases of up to 4%, CBRE added. The Business Post, 19th January
Clondalkin, Dublin 22 A temporary accommodation centre housing 148 refugees in west Dublin is to be evacuated on the advice of Dublin Fire Brigade. The International Protection Applicants will be moved from Dolcain House in Clondalkin “as soon as is practicable”, a spokesman for Minister for Integration Roderic O’Gorman said. Local TDs in Dublin Midwest were told that the process of moving the International Protection Applicants from Dolcain House in Clondalkin has begun, on the advice of South Dublin County Council (SDCC). It comes amid a serious shortfall of bed spaces for International Protection Applicants – with Citywest Transit Hub expected to close to new entrants in the coming days. The Irish Times, 20th January
Caherdavin, Limerick Developers’ plans to build a new primary care centre in Limerick have been scuppered after the land it was to be built on was rezoned for agriculture while the appeal lay within An Bord Pleanála’s backlog. Although submitted in March 2022, before the new county and development plan came into effect in July, An Bord Pleanála only issued its decision on the planning application for the primary care health centre in Caherdavin on the Ennis Road earlier this month. This was c. 10 months later and more than five months after the new development plan had come into place, rezoning the land. The new Limerick City and County development plan for 2022-2028 was formally adopted by the council last summer, coming into effect on July 29, 2022. The planning appeal for this primary care centre was lodged on March 15, 2022, over 19 weeks before the new development plan came into effect. The Irish Examiner, 19th January
Social Homes Figures obtained from the Department of Housing show that 2,706 new-build social homes were delivered up to the end of September last year. Of these, 1,946 units (72%) were acquired by way of so-called turnkey purchases – where the local authority or approved housing body enters into a forward-purchasing arrangement with a private developer – or through the Part V rule, which stipulates developers must set aside a certain portion of their developments for social housing. Turnkeys represented 54% (1,452) of the total while Part Vs represented 18% (294). 28% (760 homes) were delivered directly by local authorities via the Social Housing Capital Investment Programme or by approved housing bodies through the Capital Advance Leasing Facility. Reliance on the private sector to deliver housing was highlighted as a “vulnerability” in a briefing document prepared by the Department of Public Expenditure and Reform for its new Minister, Paschal Donohoe, when he took up the role last month. The Irish Times, 24th January
Dublin Airport The competition watchdog has received six complaints about the planned purchase by DAA of a large Nama-controlled car park near Dublin airport. DAA, the operator of Dublin and Cork airports, was the successful bidder for the only privately owned car park at the former. The property is owned by the developer Gerry Gannon, whose debts are controlled by Nama. It came on the market last year with a guide price of €70m. The 42-acre site, which has space for 6,122 cars, was previously operated by John O’Sullivan’s QuickPark. It has been closed since 2019. It is thought that a number of complaints have been lodged from underbidders for the site. If the sale is completed, DAA will own all three dedicated car parks in the vicinity of the airport. Under planning regulations set out by Fingal County Council, a maximum of 26.8k long-term car parking spaces can be provided in the area. The two car parks that DAA already owns have 17.18k spaces. In the event that the CCPC investigates the purchase, such an inquiry could take up to six months to complete. That could mean the airport car park would not open before the summer. The Sunday Times, 22nd January
Commercial Real Estate Outlook An analysis has shown that c. €10bn could be wiped off the value of commercial property in Ireland this year due to rising interest rates and weakening demand. Market analysts are projecting that commercial property values across retail, industrial, logistics, office and residential units will fall between 10 and 20% this year in response to the changing economic environment. The three main property investment funds held by Bank of Ireland, Aviva and Irish Life collectively hold c. €2.3bn-worth of commercial property assets. Over the last six months, these property funds have booked multiple write-downs, knocking more than €110m off their combined value. Bank of Ireland’s €1.2bn property fund has shed more than 6% of its value in recent months, while the €660m property fund controlled by Aviva and Irish Life’s €455m property fund are both down 3%. If the Goodbody outlook for commercial property proves true, the funds may be set to book a further €400m to €450m in write-downs this year. The Business Post, 21st January
Dwyer Nolan Accounts Dublin based developers Dwyer Nolan last year recorded pretax profits of €31.03m as revenues soared. Accounts for Dwyer Nolan Developments Ltd show that the firm recorded the pretax profits in the 12 months to the end of May 31st last as revenues increased more than 17 fold from €5.7m to €99.98m. The building firm had recorded a loss of c. €356.2k in the previous year. The Shankill-based company recorded a gross profit of €32.9m after incurring €67m in cost of sales. The Irish Times, 23rd January
The Land Development Agency (LDA) has signed tender agreements to outsource more than €42m worth of work since it was set up more than four years ago. The agency was established in September 2018 with a €1.25bn capital budget to expedite the construction of 150k homes over 20 years on state lands. At the time, the government said sites had already been earmarked for 10k homes. Last month, figures released by the agency showed it has built no homes on state lands to date, and that all 270 homes it had delivered in 2022 were acquired from some of the biggest developers in the country. In December 2022, it entered into a €12.5m framework arrangement with quantity surveying service firms. The Business Post, 21st January
Non-Performing Loans Goldman Sachs, one of the early active buyers of non-performing loans across Europe in the aftermath of the global financial crisis, has been selling portfolios in several jurisdictions and recently been working on secondary sales with a total value of more than €2.5bn. At the end of last year, Goldman sold a portfolio with a gross book value of more than €1bn to LCM. The portfolio was secured by real estate with a large residential component. For a decade the investment bank had been buying NPLs (including from Irish banks) and in the past few years it has started selling some of the legacy. React News, 23rd January
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Temple Bar, Dublin 2 The Wellington Hotel in Temple Bar in Dublin 2 has been brought to market for sale on the instructions of receiver Kroll Advisory through joint agents CBRE and Colliers. The turnkey 38-bedroom hotel is being sold by private treaty guiding excess €15m. The 38 bedrooms range in size from 140 to 250 sq. ft and a number of these overlook the Liffey. The Business Post, 14th January
Hatch Street, Dublin 2 Red Carnation Hotels is looking to sell its Dublin hotel development, Hatch Hall, for a guide price of €25m. CBRE has been tapped to market the property on Hatch Street in Dublin 2, which was originally earmarked by Red Carnation for its third hotel in Ireland. Full planning permission is already in place for the 60-bedroom, five-star hotel, which will be set over eight storeys. The redevelopment of the former chapel building will extend to 78,490 sq. ft and will also feature two bars and a restaurant. Offers for Hatch Hall are now invited to be received by 26th January. React News, 17th January
Grafton Street, Dublin 2 The firm that operates the Bewley’s café on Grafton Street has lodged a case in the Circuit Court seeking a renewal of its lease with Ronan Group Real Estate (RGRE). RGRE has disputed Bewley’s entitlement to a lease renewal based on alleged breaches of its previous tenancy agreement. Bewley’s Café Grafton Street Limited, whose 35-year lease expired last August, applied to the Circuit Court in November seeking a court order for its renewal. It is understood to have continued to pay full rent since the expiration of the lease. RGRE sought possession of the Grafton Street premises in 2020 over non-payment of rent, but that issue was resolved following mediation and the payment of arrears of €749k. The rent on the premises is c. €1.5m a year. The Business Post, 14th January
Smithfield, Dublin 7 Budget hotel brand easyHotel has officially opened its doors to its first Dublin hotel on the corner of Benburb Street and Wood Lane near Smithfield. The newly built 160-room hotel takes the group to 44 hotels across Europe, which are made up of owned, franchised and leased hotels across 11 countries. The Business Post, 14th January
Capel Street, Dublin 1 City ID, the Dutch hospitality group, is scaling back its planned tourist accommodation block on Capel Street in Dublin city centre. Last year, the firm acquired a derelict site on Capel Street located beside Jack Nealon’s pub. The site was sold to the Dutch group with planning permission in place for a 142-bedroom hotel which had been granted in 2020. City ID has applied to make changes to those plans which include building a 105-unit aparthotel on the site instead of the hotel. The Capel Street site was sold to City ID by Ringline Investments Limited, which secured the previous permission for the 142-bed hotel. The Business Post, 14th January
Liberties, Dublin 8 The developers behind a proposed co-living development in the Liberties area of Dublin have ditched their plans for the scheme, and now want to build a hotel on the site. MM Capital and SCIO Capital, two investment funds based in Ireland and London respectively, have asked Dublin City Council for permission to amend their approved plans for the complex. In 2019, a firm controlled by MM Capital and SCIO proposed to build 69 co-living units and 144 hotel rooms on the corner of New Row South and Fumbally Lane. During the pandemic, the London-based company went bankrupt and has been forced to abandon its international projects. An application by TC Fumbally Properties Limited to Dublin City Council said the operator which was previously in line to run the shared accommodation and hotel no longer operates. It added that Sonder is now in line to manage the development upon completion. TC Fumbally Properties said that Sonder does not operate co-living accommodation and has requested permission from the council to change the planned 69 permitted co-living units and amenity spaces into hotel accommodation. The changes to the development would result in a larger 235-room hotel. The Business Post, 14th January
Refugee Accommodation Two-thirds of hotels contacted about renewing contracts to host refugees have yet to sign new deals. Of the 141 accommodation providers contacted by the department whose contracts are expiring, only 51 have agreed to extend so far. A further 29 have raised queries which the department says are “being addressed”. The 141 provide 8.4k beds overall. Hotels and other forms of serviced accommodation are home to c. 46k beneficiaries of temporary protection (BOTP) – the status afforded to those fleeing the war in Ukraine under an EU-wide scheme. The hotels are being asked to sign up to a new contract that stipulates refugees must pay €10 per day for meals for adults and €5 for children, as well as pay for ancillary services like washing which had been provided for free. The Irish Times, 13th January
Lower Mount Street, Dublin 2 Knight Frank has brought Verschoyle House on Lower Mount Street in Dublin 2 to the market with a guide price of €13m. The sale offers investors the opportunity to acquire a refurbished Grade A office building of just under 17,222 sq. ft with secure income from two tenants. The largest of the two occupiers, the Pensions Authority (which occupies c. 80% of the building), is a statutory body set up under the Department of Social Protection. The Authority occupies the lower ground and first to fourth floors under two leases, paying a current rent of €668.4k pa. The ground floor is let to Ornua at a current rent of €213.5k pa. The building comes with eight basement car parking spaces. The investment produces a total income of €881.9k pa, with potential for a further increase following the settlement of the outstanding rent review on the third floor. The Business Post, 14th January
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North Wall Quay, Dublin 1 Ronan Group Real Estate (RGRE) has acquired Citigroup’s existing European headquarters on Dublin’s North Wall Quay. According to market sources, RGRE paid c. €140m to secure ownership of the property in the face of competition from UK-headquartered private equity property manager Henderson Park, and from Westridge Real Estate. The offices at 1 North Wall Quay were offered to the market by agent Knight Frank at a guide price of €120m last March. Once Citi’s workforce is ready to move into Waterfront South Central and vacate the company’s current premises at 1 North Wall Quay, RGRE will take ownership of the building. The Irish Times, 12th January
Serviced Office Sector According to Shane Duffy, managing director of Click Offices, the 9%+ increase in 2022 in serviced office desk numbers in Dublin alone to 34.5k from 31.65k the previous year was “almost double the increase that was expected”. The most sought-after area and the one with the lion’s share of serviced desks in Dublin – c. 21k of them – is in the Dublin 2 postcode. The Business Post, 14th January
Henry Street, Dublin 1 Dublin City Council has refused planning permission to developer Fitzwilliam Real Estate for a 12-storey, 159-unit build-to-rent scheme over part of the Arnotts store on Henry Street in Dublin. The council said its refusal is supported by a policy in the Dublin City Development Plan that there would be a general presumption against large-scale residential developments which are comprised of 100% build-to-rent units. The 159 units proposed by Fitzwilliam Real Estate were comprised of 60 studios, 85 one-bedroom apartments and 14 two-bedroom units. The scheme would involve the construction of a 12-storey-over-basement element fronting Williams Lane, a five-storey element over the Arnotts multistorey car park and a two-storey element over the Arnotts store. The Irish Times, 11th January
O’Connell Street, Dublin 1 The long-delayed redeveloped Clerys on Dublin’s O’Connell Street, which shut down c. eight years ago, is to be completed within weeks, with shops expected to open before the summer. In 2018 it was sold to a division of New York-based real-estate firm Rockefeller Group – Europa Capital, and its local partners, Derek McGrath’s Core Capital and Paddy McKillen jnr’s Oakmount, for a sum understood to be c. €63m. The old store and an adjoining building, now called the Clerys Quarter, has been undergoing redevelopment since 2019 as a retail, office, bar and restaurant complex, as well as a hotel. The Irish Times, 16th January
Hogan Place, Dublin 2 BNP Paribas has brought to market 19-20 Hogan Place in Dublin 2. The property comprises a four storey over basement, modern HQ office building (5,683 sq. ft) plus three one-bed apartments (355 sq. ft each) separately accessed from Eblana Villas. The entire building is being offered for sale by private treaty with vacant possession of the office element only. Each of the 3 apartments are fully let. BNP Paribas Real Estate, 11th January
Purpose Built Student Accommodation (PBSA) According to the latest Cushman & Wakefield Irish Student Housing Report, growing student numbers and positive demographics within Ireland continue to underpin the fundamental demand for PBSA. In contrast to the growth within demand, supply has tapered, particularly in the Dublin market. As of Q3 2022, just one scheme was under construction in the Dublin market, meaning stock will remain relatively unchanged in the short term. The volume of bed spaces in the pipeline, either via pre-planning, plans submitted, or plans granted, on paper points to more supply to come on stream, however the realities currently appear different with uses and viability coming under scrutiny.
From an investment perspective, the student accommodation market has recorded an increase in activity over the past 12 months with €305m recorded across three deals of note. As there are a number of assets on the market at present, eyes will turn to their performance. A period of “price discovery” due to rising costs of debt and outward yield movement is being felt across all sectors, with PBSA not immune to this adjustment, despite the underlying strength of its occupational demand. Cushman & Wakefield Research
Construction Legislation Tax breaks for developers are now being considered as part of plans to activate 70k idle planning permissions for residential developments. According to market sources, the government is looking specifically at tax breaks for apartments rather than houses. There have been complaints that most large apartment schemes in recent years have been developed by institutional investors for the rental market rather than first-time buyers. There were lower standards for build-to-rent developments introduced in 2018, with less stringent storage requirements and more apartments permitted per floor. The Business Post, 14th January
Land Development Agency (LDA) The Government is facing a call for c. €1bn in additional funding for the LDA as the State body steps up interventions in the housing market. The organisation was promised €2.5bn at the outset – €1.25bn in capital from the Ireland Strategic Investment Fund and another €1.25bn in debt – and potentially another €1bn. The LDA already has agreements to back five private developers building 671 homes in Dublin, Cork, Wicklow and Waterford and is in talks with four others on plans that will bring to c. 1,000 the number of homes built under its Project Tosaigh initiative. The LDA separately has planning permission for c. 597 new dwellings on State lands at Shanganagh Dublin, 265 dwellings on State land at St Kevin’s Hospital, Cork, and for 219 units at Devoy Barracks, Kildare. Construction has commenced at Shanganagh and at St Kevin’s Hospital in Cork. Planning approval has been sought for a further 2,755 units on assorted sites in the Greater Dublin Area. The Irish Times, 16th January
Land Rezoning, Galway The Minister of State for Housing Peter Burke wrote to the local authority, directing it to change 26 separate elements of the newly ratified Galway City Development Plan 2023-2029, including the rezoning of a 3.2 acre site on the Headford Road. This large parcel of land, which is situated below sea level, is designated as a flood zone A area by the Office of Public Works. Despite objections from the Office of the Planning Regulator, councillors voted to ignore the recommendation of their own chief executive, Brendan McGrath, and rezone the Headford Road site for residential use during final deliberations over the city development plan in late December. The Irish Times, 15th January
Crumlin, Dublin 12 A community group is asking the High Court to overturn permission granted for the construction of 150 homes in Crumlin, Dublin. Bethmell Limited, which has a registered address in Walkinstown, Dublin, says An Bord Pleanála’s fast-track approval of the plans for the site of Glebe House is invalid for various reasons. The permission was granted to Seabren Developments Ltd. Last February the High Court quashed a previous planning permission granted to Seabren for the development of 152 units at the site. The Irish Times, 16th January
Housing Assistance Payment (HAP) The latest Locked Out report by the Simon Communities of Ireland shows there was just 41 properties available across the country for people on the HAP, although the number of properties available to rent at any price did increase. In the latest of the series of quarterly reports by the charity, 757 properties were available to rent in December, c. double the number available last September, but still far fewer than the 1,349 available in December 2021. The report comes amid record levels of homelessness, with 11,542 people in emergency accommodation according to latest monthly data. The number of properties available to rent increased for the first time in two years, but those attainable by those on HAP payments remains low, with 11 of the 16 study areas having no properties available to rent in any household category within standard or discretionary HAP limits. The Irish Times, 13th January
Landlord Exodus The exodus of landlords from the rental sector through selling up is putting households at immediate risk of homelessness, housing charity Threshold has warned. In its latest quarterly report, Threshold said that the threat of eviction is the greatest issue facing private renters in Ireland, but over half of eviction notices given to tenants in the last quarter of 2022 were invalid. The charity received 13.5k contacts from households through telephone or online between October and December 2022, and over one-third of queries came from renters who had received a notice of termination from their landlord. Of the clients who reached out to Threshold in Q4 2022, 1,837 were at risk of homelessness and landlords selling up was the reason in the majority of cases. The Irish Examiner, 17th January
Donabate, Co Dublin A local community group has initiated a legal challenge aimed at overturning planning permission for a development in Donabate, Co Dublin. Portrane Donabate Community Council is seeking judicial review of the permission granted by An Bord Pleanála to Aledo Donabate Ltd for the strategic housing development of 1,356 housing units, including c. 1k apartments, at Corballis East. The proposed development also includes a local retail centre, three creches, a reserved site for a new Gaelscoil and a 35-acre nature park. It is claimed most of the proposed residential units would not be in two-storey blocks in material contravention of the area development plan. The planning application proposed nine apartment blocks of five storeys, five apartment blocks of four storeys, a sheltered apartment block of three storeys and a significant number of three-storey houses and three- and four-storey duplex units. The Irish Times, 16th January
Sheriff Street Upper, Dublin 1 Dublin apartment developer Eagle Street has paused construction work at a major development site for more than 700 build-to-rent apartments in the city’s docklands. Its international funder – US asset manager Nuveen – is understood to be reviewing construction costs in the high interest rate environment. Eagle Street, run by former Glenveagh executive Shane Scully, has permission to build 700 apartments in blocks of up to 18 storeys on the former Castleforbes Business Park site on Sheriff Street Upper. The project backers still believed “in the viability of Dublin as a market” and felt the market here still had “significant tailwinds behind it and strong fundamentals”. But they were “currently just looking at the options, given the current pricing of construction, of what might be viable”. The Irish Independent, 15th January
Cork UCC and the Tyndall National Institute have lodged an application for planning permission for the phased development of a new bridge and boardwalk. The project is designed to provide a shared pedestrian and cycle link between the existing Tyndall Campus at Lee Maltings on the south bank of the River Lee and the Distillery Fields on the north side of the River Lee. The proposals have been submitted to Cork City Council. A separate planning application for the construction of a new purpose-built research facility was lodged by UCC and the Tyndall National Institute, with plans including a seven-storey building comprising of research laboratories with support accommodation of seminar rooms, offices, exhibition space and a café. Following an appeal, the final decision on the planning is yet to be made by An Bord Pleanála. The Irish Examiner, 11th January
Santry, North Dublin Global healthcare group UPMC is acquiring the Sports Surgery Clinic (SSC), an independent hospital located in the north Dublin suburb of Santry. SSC will become part of UPMC’s network of orthopaedic, sports medicine and rehabilitation facilities, and will also become UPMC’s fourth hospital in Ireland, joining UPMC Whitfield in Waterford, UPMC Kildare in Clane, Co Kildare, and UPMC Aut Even in Kilkenny. Terms of the purchase were not disclosed. Latest accounts for SSC show that it made a pre-tax profit of €6.7m on turnover of €59.1m in 2021. It had accumulated profits of just more than €33m on December 31st, 2021. The Irish Times, 16th January
Bank of Ireland Real Estate Fund Bank of Ireland has blocked investor withdrawals from a €70m real estate fund “until further notice”, as commercial property markets continue to correct. The fund is described as “a pan-European fund of funds” targeting returns from third-party asset managers, with a portfolio of property assets located predominantly in Northern European cities. The move to restrict investor withdrawals comes as the bank has taken significant write-downs on the value of its main property investment fund, which has c. €1.2bn under management. The main fund has not been gated. Since September, the fund has lost more than 6% of its value and is down 15% since the start of the pandemic. The Business Post, 14th January
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