Prime Retail Investment in Dublin City Centre for €4m

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Bannon are guiding €4 million for 49 Lower O’Connell Street, a Georgian retail building rented by Footlocker at €240,000 a year. The investment will show an initial return of just under 6%.

The five-storey over basement building is located at the southern end of the street close to Penneys, McDonald’s and Schuh. It has an overall floor area of 483 sq.m (5,205 sq.ft) and previously had retail use on the first floor as well as at street level.

Footlocker concentrates all its selling efforts on the ground floor and uses the additional space for offices and storage.

There are 13 years remaining on the lease with the next upwards only review due in 2017.

David Carroll of Bannon, who is handling the sale, said the building had a “great profile” beside what would be a very busy intersection of the Luas cross-city service and the Luas red line. The €4 million sale would appeal particularly to cash buyers and debt-backed investors.

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RBS increases Project Aran to €6billion

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Royal Bank of Scotland has increased its Irish non-performing real estate loan portfolio, Project Aran, by €4.3bn to approximately €6.0bn, with the same three-strong finalists now to bid across the enlarged NPL.

Project Aran, derived from RBS’ subsidiary Ulster Bank’s loan book, launched at the turn of September initially with a nominal balance of €1.6bn, secured by 411 borrower connections and 315 properties, which was quickly increased by around €100m to €1.7bn.

The increase to approximately €6.0bn was taken prior to selection of the three finalists; Lone Star, Cerberus and a consortium comprised of CarVal Investors, Goldman Sachs’ special situations fund and Apollo Global Management.

Final, binding bids are expected by early December.

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A1 to recoup assets in Russia accumulated by Quinn family

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IBRC, the former Anglo Irish Bank, has set up a joint venture with Russian investment company A1 to recoup real estate assets in Russia and Ukraine accumulated by Quinn family. The assets include a skyscraper in Russia, a DIY chain and various logistics parks.

A1 will hold a public auction on December 5th on the sale of “Q-Park” in Kazan, called “b” in the investment company. The starting price for property, which exceeds 99.500 sq.m, is 2.575 billion rubles (€40 million). Tenants include Efes, Bosch and Schneider Electric.

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Residential Property Prices rise by 15% in the year to September

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In the year to September, residential property prices at a national level, increased by 15% the CSO reported yesterday. This compares with an increase of 14.9% in August and an increase of 3.6% recorded in the twelve months to September 2013.

In Dublin residential property prices grew by 2.5% in September and were 23.4% higher than a year ago. The price of residential properties in the Rest of Ireland (i.e. excluding Dublin) rose by 1.1% in September compared with a decrease of 0.1% in September of last year.

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Nama reports €102m profit for first half of year

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Nama made a profit of €102m for the first six months of this year, and has guided that it will complete its work by the end of 2017 or mid-2018, according to its annual statement, published yesterday. This was almost double the €55 million surplus achieved in the same period of 2013. The report shows that Nama’s cash generation accelerated in the six-month period, generating cash of €5.4 billion during the first half of this year compared with €2 billion in the same period of 2013.

NAMA is also focusing on the completion of a number of residential properties in London in 2015 and 2016, while it is also planning and facilitating the delivery of office accommodation in Dublin with a special focus on the city’s Docklands Strategic Development Zone. The agency has committed to ensuring that a pipeline of large portfolios of mainly Irish property assets will be put up for sale, adding that packaged deals for properties with a minimum value of 250m will be offered for sale every four months.

View Quarterly report and Accounts

View Annual Statement for 2015

Charity Home Wexford Cycle 2014 – 25th Anniversary

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The 25th Welcome Home Wexford Cycle took place on Saturday, 20th September and our fellow colleagues did us proud.

In support of the Peter McVerry Trust, which was established in 1983 by Fr Peter McVerry to tackle homelessness, drug misuse and social disadvantage.

 

Google in talks to buy historic Boland’s Mill site

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Google is understood to be in discussions to buy the historic Boland’s Mills site in Dublin’s Docklands.

The landmark building, which was at the centre of fighting during the 1916 Easter Rising, is controlled by Nama. The Boland’s Mill site was bought by developer Sean Kelly for €42m during the boom, with plans to build apartments, offices and retail unit on the 1.7-acre site. Treasury Holdings owned adjacent sites to the mills.

So far Google has spent around €1bn in Ireland over the last decade between buildings and staffing costs.

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Key Points in the Budget 2015

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Read the official summaries of the key budget measures and the detailed analysis from leading accountancy firms.

  • The finance minister announced a reduction in the higher rate of income tax from 41% to 40%.
  • Changes to the Employment and Investment Incentive (EII) raise company limits, increase the holding period by one year and include medium-sized companies in non-assisted areas and internationally traded financial services.
  • Noonan also announced that the Seed Capital Scheme will be re branded as ‘Start-Up Relief for Entrepreneurs’, and will be extended to individuals who have been unemployed up to two years.
  • Other tax measures include changes to the R&D Tax Credit scheme, where the 2003 base-year restriction will be removed from January 1 2015, at a cost of €50m to the government coffers.
  • The three-year corporation tax relief measure for start-ups on their trading income (and certain capital gains) will be extended to businesses setting up in 2015.
  • Noonan has also removed the restriction on capital allowances for the provision of specified intangible assets. The use of such allowances in any accounting period was heretofore restricted to a maximum of 80% of the trading income from the relevant trade in which the acquired assets are used. That restriction will now be removed, at a cost of €27m to the government.
  • The 12.5% corporation tax has not been changed, while the 9% VAT rate for the tourist sector has been retained.
  • The minister confirmed that Capital Gains Tax waiver that has been in place for the last number of years enabling purchasers of real estate to avail of a seven year exemption from CGT is to be phased out by year-end 2014.

View Department of Finance Summary

View BDO Analysis

View DBASS Analysis

View RSM Farrell Grant Sparks Analysis

View PWC Analysis

Government Finance Statistics Report

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A report from the Central Statistics Office (CSO) shows at end Q2 2014, Ireland’s Government deficit fell to 3.8% of gross domestic product in the second quarter of 2014 with Government Debt at 116.7% of GDP.

Government Deficit of 5.7 % of GDP in 2013

General Government experienced a deficit of €9,967 million (5.7% of GDP) in 2013 – an improvement on the 2012 position of €13,901 million (8.0% of GDP). Government revenue increased from €59,083 million in 2012 to €60,837 million in 2013 driven by increased tax and social contribution revenues, while expenditure decreased from €72,984 million to €70,804 million over the same period with decreases observable in most expenditure categories except interest and current transfers. Taxes and social contributions, the largest component of revenue over the period, represented just under 87% of total government revenue in 2013. Social benefits, the biggest expenditure category, accounted for just over 40% of government spending in 2013.

Government Debt at 123.3% of GDP in 2013

The gross debt of General Government stood at €215,550 million at the end of 2013, or 123.3% of GDP, up from €210,226 million at the end of 2012, or 121.7 % of GDP. General Government Net Debt for 2013 amounted to €160,962 million or 92.1% of GDP.  This net debt figure is obtained by deducting the values of the financial assets from the corresponding categories of financial liabilities in General Government Gross Debt

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PMI reports increase in construction activity

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The September construction PMI (purchasing managers’ index) shows house-building activity grew at its fastest rate since 2000.

The PMI report – a seasonally adjusted index designed to track changes in total construction activity – posted 61.5 in September, broadly unchanged from the reading of 61.4 in August and thereby signalling a further strong rise in activity at Irish construction firms.

New business and employment both rose at sharper rates than in August. Commercial construction also rose at a sharp pace, although growth was at a slightly slower rate than in August. The commercial index read 62.7 in September, below the previous month’s figure of 63.2.

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SFA calls for cut in capital gains

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The Small Firms Association (SFA) has called for a cut in capital gains tax as part of next week’s Budget.

At a meeting with Minister Simon Harris, TD in Leinster House, Director of the Small Firms Association, Patricia Callan, stated that “small businesses around the country are effectively being prohibited from tendering for public contracts, in the move to centralise government procurement into large-scale contracts that they are ineligible to apply for.”

The body said the rate should drop to 10% for entrepreneurs selling businesses, which would bring it in line with Britain’s levy. It also wants the general GCT rate to fall to 20%.

In 2013, the published data suggests that 28% of tenders are being awarded to countries outside of Ireland, up from a previous high of 18% recorded. Ireland frequently tops the list of countries most likely to award to non-national countries and this trend is increasing all the time.

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Hibernia Reit seeks €300m to fund further commercial property deals

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Irish property investment company, Hibernia Reit has said yesterday it intends to raise €300 million in a placing and open offer of shares to fund further commercial property deals. The company plans to fund further property investments comprising both new acquisitions and capital expenditure on its existing portfolio from the funds raised.

Hibernia said it will issue 285,317,459 new ordinary shares at a price of €1.05. The issue price represents a discount of 8.5c (7.5%) on yesterday’s closing price of €113.5 per existing ordinary share on the Irish Stock Exchange.

Ibec predicts GDP growth of 6.1% for this year

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Ibec, the group that represents Irish business, today published its new Quarterly Economic Outlook which is forecasting GDP growth to reach 6.1% on the back of a broad-based recovery in the economy, which includes a 1.5% increase in consumer spending, a 14.2% increase in investment and a 12.2% increase in exports this year.

According to Ibec, there is no need for the Government to do an austerity budget as the level of growth in the economy will reduce the fiscal deficit down to 2.5%,

In the Q3 Economic Outlook, Ibec also raised its 2015 GDP growth forecast to 4.5% (up from 3.9%), and this year’s GNP growth forecast to 5.4% (up from 2.5%).

Key issues highlighted in the forecast include:

  • Imports and exports: Exports will grow by over 12% this year, the strongest growth since 2000. Imports, however, will also grow strongly by 11% and the resulting net exports will contribute 3.5% to GDP growth, by far the largest contribution to growth.
  • Investment: Ibec’s business sentiment index remains high and indicates that companies’ confidence in the recovery is strong. Therefore, we expect strong investment growth this year and next (14.3% and 13.8% respectively).
  • Consumer spending: Increased job creation and a reduction in the budget adjustment will mean disposable income will increase by around 3% next year. On the back of this we expect consumer spending to rise by 1.5% this year and 2.9% in 2015.
  • Employment: There has been a slowdown in overall year-on-year employment growth compared with the second half of last year (from +3.2% to +2%); but these figures are still the strongest in the EU. The quality of employment growth has also been better as more new roles are full-time rather than part-time. We expect the number at work to return to early 2009 levels by the end of 2015.

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Spar to open 50 new stores with creation of 1,000 jobs

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The BWG group, the owners of SPAR, are to invest €100m in store development over the next five years. The investment will see 50 new stores open around the country between now and 2016 with the creation of approximately 1,000 jobs.

The announcement was made at a SPAR retailer convention in Killarney this morning. It follows the recent investment by BWG South Africa, which saw it take an 80% holding in the group.

Volume of Retail Trade Up in Euro Area

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The European Union’s statistics office Eurostat has reported that retail sales in the euro zone rose 1.2% month-on-month in August with 1.9% year-on-year gain.

The 1.2% increase in the volume of retail trade in the euro area in August 2014, compared with July 2014, is due to rises of 1.7% for automotive fuel, of 1.5% for the non-food sector and of 0.6% for “Food, drinks and tobacco”.

Monthly Comparison

The highest increases in total retail trade were registered in Germany and Luxembourg (both +2.5%), Portugal and Sweden (both +2.3%) and Poland (+2.2%), and the largest decreases in Romania and Slovakia (both -0.6%).

Annual Comparison

The 1.9% increase in the volume of retail trade in the euro area in August 2014, compared with August 2013, is due to a rise of 3.6% for the non-food sector, while both “Food, drinks and tobacco” and automotive fuel fell by 0.2%. Total retail trade rose in all Member States for which data are available, with the highest increases observed in Luxembourg (+12.5%), Estonia (+6.7%) and the United Kingdom (+5.6%).

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NAMA to bring five major portfolios of Irish property to the market in Q4 2014

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The National Asset Management Agency (NAMA) has announced that it will bring five Irish property portfolios, with a combined value of approximately €600m, to the market in Q4 2014.  The portfolios will comprise offices, shopping centres, hotels and apartments. This announcement is in line with NAMA’s publicly stated intention to bring property portfolio sales with a minimum value of €250m to the market each quarter.

The portfolios for sale will consist of:

  • Two portfolios of Dublin offices, one of which will include prime offices at 4-5 Grand Canal Square
  • One retail portfolio, comprising five regional shopping centres
  • One residential investment portfolio, comprising approximately 600 apartments spread across seven locations in Dublin
  • One hotels portfolio, comprising a number of regional hotels

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Facebook to double its office size in Dublin Docklands

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The social media giant, Facebook is doubling the size of its European headquarters in the Dublin Docklands with an adjoining office to take its total space up to 250,000 sq.ft. The deal includes the standard landlord fit-out including ceilings, floors, light fittings and air conditioning.

It is reported that the lease which will be for 25 years will see Facebook pay the new standard city centre rent of approximately €45 per sq.ft, but the deal does include the option to break the lease after a period of 13 years. Facebook is understood to have negotiated a rent of no more than €376 per sq.m (€35 per sq.ft) for its first block at 4 Grand Canal Square at the end of 2011.

Retail Sales Volume decreases in August 2014

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The Central Statistics Office report released yesterday shows the volume of retail sales (i.e. excluding price effects) decreased by 2.9% in August 2014 when compared with July 2014 and there was an increase of 6.8% in the annual figure. If Motor Trades are excluded, there was an increase of 0.3% in the volume of retail sales in August 2014 when compared with July 2014.

There was a decrease of 1.3% in the value of retail sales in August 2014 when compared with July 2014 and there was an annual increase of 5.3% when compared with August 2013. If Motor Trades are excluded, there was a monthly increase of 0.1% in the value of retail sales and an annual increase of 2.2%.

The sectors with the largest month on month volume increases were Furniture and Lighting (+11.0%), Bars (+2.6%) and Electrical Goods (+2.2%). The sectors with the largest monthly decreases were Motor Trades (-4.4%), Hardware, Paints & Glass (-2.6%) and Food, Beverages & Tobacco (-2.4%).

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Dealz to open six more stores in Ireland

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UK-listed discount retailer Poundland is planning to open six new Dealz stores in Ireland over the next year. The new openings will bring to 41 the number of shops in the Republic for Dealz, which opened here three years ago.

To date, the UK company has invested approximately €53 million in its Irish network with about €4.5 million being spent this year on its expansion. It attracts about 200,000 customers a week to its Irish stores. The group’s revenues from the Republic amounted to £55 million for the year to the end of March 2014.

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The Square Tallaght gets planning permission for extension

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An Bord Pleanála has given the go ahead to a €40 million extension of The Square shopping centre,Tallaght. A development that is being supported by the National Asset Management Agency. Permission was granted to Indego, which owns about 70% of the units at The Square, following an appeal by Dunnes Stores in April.

The project will create about 300 jobs during construction, which is due to begin in spring 2017. It will add about 200,000 sq.ft of retail space, creating 400 jobs. A multi-storey car park over six levels with approximately 800 spaces is also planned.

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Starbucks Open a Further Two Stores

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Bannon have recently let two units to Starbucks, the American coffee chain, namely at no. 8 North Earl Street, Dublin 1 and the Marshes Shopping Centre, Dundalk which was acquired by Kenny Wilson earlier this month.

Starbucks have taken the ground and basement of 8 North Earl Street under a sub-lease with 7 years unexpired lease term from Carphone Warehouse. The unit measures 129.5 sq.m with a ground floor retail area of 72.5 sq.m, Starbucks are believed to be paying a rent of €70,000 per annum with a minimal limited rent free period provided.

Starbucks have also agreed to take a unit at Marshes Shopping Centre, Dundalk which is understood to be a 20 year lease for 1,800 sq.ft at a rent of €60,000 p.a.

Daniel McLaughlin of Bannon who dealt with the lettings commented “there were a number of offers from established retailers for the property given the profile and high levels of passing footfall. We are witnessing demand for well-located city centre properties which far outstrips the availability currently within the market.  We see this trend continuing for the foreseeable future as consumer spends recovers coupled with a lack of new stock being redeveloped.”

Quarterly International Investment Position and External Debt

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The Quarterly report released from the Central Statistics Office today show Ireland’s quarterly international investment position (IIP) results overall stocks of foreign financial assets of €3,124.9bn – an increase of €81.1bn on the end-March 2014 level, while the corresponding stocks of foreign financial liabilities increased by €82.9bn to €3,302.7bn over the quarter.

Irish residents had an overall net foreign liability of €178bn at end-June 2014, an increase of €2bn on the net foreign liability level at end-March 2014. Excluding investment funds, Irish controlled enterprises account for 29% of the remaining external assets and 31% of external liabilities.

Within the commercial financial sector (i.e. MFI and OFI), IFSC enterprises accounted for a very high proportion of the sector’s overall foreign assets and liabilities. IFSC assets abroad increased by €48.9bn to €2,483.8bn at end-June 2014, or 94% of the sector’s foreign assets; IFSC liabilities at €2,517bn, an increase of €69.4bn, represented 96% of the commercial financial sector aggregate liability (and 76% of Ireland’s total foreign liabilities). IFSC enterprises showed a net liability position of €33.1bn

CSO statistical release, 25 September 2014

Housing Supply Capacity in Dublin’s Urban Settlements 2014-18

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A report, which has been commissioned by the Society of Chartered Surveyors Ireland (SCSI), explores the capacity of lands zoned for residential development within the Dublin Region to deliver the requisite housing units for the projected population of the Dublin Region between 2014-2018.

The key findings in the report are:

  • There are 2,233 hectares (ha) of land zoned and potentially available for residential development, which is 2.4% of the total land area in the Dublin Region.
  • This zoned land can deliver approximately 102,500 additional housing units under the minimum recommended density scenario.
  • This can result in the provision of housing for approximately 269,000 additional persons.
  • There is a minimum housing unit requirement of 35,433 between 2014 – 20181. However, currently there is only a total of granted (extant) planning permissions for 26,580 units, resulting in a shortfall of 8,853 units over the five-year period.

View Full Report

View Planning and Zoning in Dublin

A ten step strategy to address the housing supply shortage

Upper floor accommodation to let on Middle Abbey Street, Dublin 1

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Recently refurbished upper floor accommodation to let on Middle Abbey Street.

Extending to net internal area of 127 sq.m (1,367 sq.ft). Excellent high profile location.

For further details please contact Louise Doherty or Katie Williams of Bannon on 01 6477900

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Allianz to invest €140m in Irish property market

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Allianz Real Estate, the international real estate division of Allianz Group with €30bn in assets under management, has committed to invest €140m in IPUT, the largest unlisted debt-free property fund in Ireland. IPUT currently manages over 90 portfolios, valued at more than €1bn, including 43 prime office property in Dublin’s central business district valued at €775m.  Most recently, it acquired a portfolio of Dublin-based assets, known as the Salix portfolio, from the Bank of Ireland staff pension fund for an all cash payment of €115m.

E-day is Today

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Today is E-day, the date from which central Government, local authorities and State agencies stop issuing and accepting cheques from businesses.

The particular focus of e-day is to encourage SMEs to migrate from cheque usage as they are either issuers or receivers of more than 60% of all cheques in Ireland.  A shift from cheques to electronic as a preferred method of payment will result in reduced costs and improved cash-flow for the overall business sector.

The NPP, National Payments Plan, estimates that savings of up to €1 billion per year can be made if Ireland were to match best practice in Europe by migrating away from cheques and cash in favour of electronic payments.

Construction tender prices increase

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The Tender Indices for the second half of 2014, produced by the SCSI, show construction tender rates continue to rise steadily in 2014, up 4.4% from this time last year. Construction tender prices increased by 2% since the beginning of 2014.

The continued stabilising of tender rates in the first half of 2014 are due to a number of factors. International demand for materials such as steel, metal etc., rising fuel prices and running costs have led to material price increases that can no longer be absorbed within tender rates. The rates also reflect the recent steady increase in construction activity in Dublin.

IBRC seizes property company behind eight SuperValu stores

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Irish Bank Resolution Corporation (IBRC) has appointed Liam Dowdall and Sean McNamara of Smith & Williamson accountants to take control of HCJV, the property arm of the Caulfield McCarthy retail group, one of the country’s biggest SuperValu franchisees which owns stores and shopping centres in eight locations around the country on foot of unpaid loans totalling more than €80m.

The Caulfield McCarthy group includes outlets at the Hypercentre in Waterford, Loughboy in Kilkenny, Bandon in Cork, Tipperary town, Merchant’s Quay in Cork city, Malahide in Dublin, and Enniscorthy and New Ross in Wexford. The retail side of the business Caulfield McCarthy Group Retail, is not in receivership, and the stores, which employ about 1,000 staff, will continue to trade as normal.

The loans were due to be sold on by IBRC as part of its liquidation, but according to the receivership appointment notices, it was the bank that put in Smith & Williamson, and not any third party loan buyer.

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Shopping Centre Investment in Rathfarnham

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Bannon are delighted to bring to the market the sale of Rosemount Shopping Centre, Rathfarnham, Dublin 14. The shopping centre comprises a two level scheme with 8 retail units situated at ground floor and a further 4 commercial and offices units at first floor. The first floor units are served by two stairwells with a minimum quantum of common area to be maintained. There is an attractive Initial yield excess of 8%.

The scheme extends to 2,215.4 sq.m (23,846 sq.ft) with the benefit of 112 surface car parking spaces. This car park has been taken in charge by South Dublin Co. Council. Key tenants include Supervalu, Shannon’s Pharmacy, Rosemount Meats, Ray’s Catch, Fresh Fruit & Veg Delicatessen and Truly Scrumptious Café amongst other complimentary uses. The shopping centre has full occupancy with excellent income history.

For further details please contact Daniel McLaughlin, Rod Nowlan or Ben Semple of Bannon on 01 6477900

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Property firm Green REIT reports net profits of €43m

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Green REIT Plc today announced its results for the period from incorporation on 24th June 2013 to 30th June 2014 which reported a pre-tax profit of €43 million for its first year of operation, as it re-valued its portfolio upwards by approximately €36 million.

In the 12 months to June 30th 2014, Green Reit reported total passing rents of €28.5 million, an investment income yield of 7%, and a dividend of 0.92 cent.  Over 73% of the assets are in offices, 17.5% in retail, 3.6% in development land, 2.4% in industrial and 3% in other investments.

Reit said that it has a further €322 million to invest into new opportunities.

Please view full report – Preliminary Results for the period to 30th June 2014

New type of loan for small businesses

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The network of Local Enterprise Offices (LEOs) has joined forces with Microfinance Ireland (MFI) and launched a new type of loan support aimed at Ireland’s small business community called ‘LEO Microfinance’.

Start-ups and small businesses which employ fewer than 10 people can now apply directly to any of the 31 LEOs around the country for the new loan package. It offers loans of between €2,000 and €25,000 at a reduced rate of interest of 7.5% as opposed to 8.5% on a standard loan rate with flexible repayment options. It is expected that up to 250 new applications for the loan support will take place this year alone. Based on an average loan size of €15,500, this would mean €3.8m in lending.

For more information visit www.microfinanceireland.ie

Retail Warehouse Units For Sale – Barrow Valley Retail Park, Carlow

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Barrow Valley Retail Park have 9 retail warehouse units for sale on the instructions of the Joint Receivers Michael Madden and Michael Coyle.

Units are available individually or as a single lot.

The units for sale extend to approximately 56,165 sq.ft on ground with mezzanine accommodation of approximately 18,435 sq.ft which forms part of a modern retail park scheme of 20,000 sq.m anchored by the only Dunnes Stores in Carlow. High profile location with over 500 metres frontage to the N80 Northern Relief Road and over 500 car parking spaces. Easily accessible, convenient location 2km from Carlow Town Centre.

Retail occupiers include Lifestyle Sports, Hughie Doyle Furniture, Tenants t/a The Ivy Rooms and Tyndall Clinic and Pharmacy. Leisure occupiers include The Talbot Hotel (80 bedrooms) and The Dome Leisure Centre. Motor occupiers include Ford Motors, Mitsubishi Motors and Meridian Motors.

For more information please contact Cian McMorrow on 01 6477900

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Six Irish shopping centres to be offered in Project Spectrum

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There are six Irish shopping centres to be offered for sale in a single lot by Lloyds Banking, named the Spectrum portfolio, in a further move to recover some of the development loans granted by Bank of Scotland Ireland.

Joint agents Bannon and Savills are quoting €120 million for the shopping centres at Douglas in Cork, Quayside in Sligo town, Bloomfields in Dún Laoghaire, Co Dublin, The Mill in Clondalkin, Dublin 22, Kilbarrack in Dublin 5 and Dundalk Retail Park in Co Louth. The sale also includes a rented three-storey office building in Clondalkin and 30 acres of development land adjoining Dundalk Retail Park.

The Spectrum portfolio’s seven assets produce approximately €11 million of income, which at a sale price of €120 million would offering a net initial yield in the region of 9%.

The retail schemes include:

  • Douglas Court Shopping Centre, South of Cork City. WAULT, 7.64 years, 85% occupancy, annual rent: €3.9m
  • Dundalk Retail Park, Dundalk, Co. Louth. WAULT, 8.32 years, annual rent: €2.46m
  • Quayside Shopping Centre, Sligo Town. WAULT, 3.97 years, annual rent: €1.28m
  • Bloomfields Shopping Centre, Dun Laoghaire, Co. Dublin. WAULT 7.2 years, annual rent: €852.2m
  • The Mill Shopping Centre, Clondalkin, Dublin 22. WAULT 10.9 years, annual rent: €1.29m
  • Kilbarrack Shopping Centre, Dublin 5. WAULT 11.79 years.  Annual rent: €721m
  • A State let office block opposite The Mill Shopping Centre on Ninth Lock Road, building let in its entirety to Dublin City Council and the OPW. WAULT, 5 years, annual rent: €451.5m.

First round bids are called for 10th October, with second and binding bids expected three weeks later before closure with the winning bidder slated for mid-November.

For further information please contact Rod Nowlan of Bannon on 01 6477900

The Spectrum portfolio, renamed from the portfolio’s original name of Project Thomond after peripheral Limerick assets were removed.

Woodies Owner Grafton Group reports strong performance all round

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Woodies owner Grafton Group has reported a strong performance in their first half of the year, with revenue, profit and earnings per share all rising on the back of improving trading conditions. Profit before tax was up more than 280% from 24.5 million in the first six months of 2012 to 68.4 million in the same period this year, the company said in a statement.

The company said the merchanting business in Ireland reported a significant increase in revenue, which rose 5.6% from €114 million in 2013 to €121 million in the first six months of this year. Operating profit advanced “very strongly” from €1.5 million to €6 million and the operating margin increased by 3.3 percentage points to 4.%. The UK merchanting business, which constituted 73% of group revenue, performed strongly due to volume growth in the residential repair, maintenance and improvement market.

“The benefit of restructuring of its Woodies chain completed in the second half of 2012 that involved the consolidation of two stores and the realignment of rents to current open market levels in ten stores enabled the comparative half year loss to be eliminated and the business returned to profitability”, said Grafton.

Hibernia Reit acquires 0.75 acre freehold site in Dublin’s South Docks

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Property investment company Hibernia Reit has exchanged contracts to acquire a 0.75 acre freehold site at 1-6 Sir John Rogerson’s Quay, Dublin 2 for € 17.75 million in an off-market transaction.

The site, which fronts onto the river and adjoins Hibernia’s recently acquired Observatory Building, has existing planning permission for 102,000 sq. ft. net lettable of offices, c. 5,000 sq. ft. of retail space, three residential units and 34 parking spaces.

With Hibernia’s Windmill Lane Site and Hanover Building immediately behind and the Observatory Building adjoining, the acquisition gives Hibernia ownership of a full riverside quadrant in the South Docks area, which has become one of the most popular office locations in Dublin in recent years.

This acquisition is Hibernia’s eleventh since listing on the Irish Stock Exchange in December 2013. Following completion of the acquisition of the site and its recent acquisition of The Forum building in the IFSC, Hibernia will have invested € 393 million, with a further € 63 million committed.

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Hibernia Reit acquires Forum building in IFSC

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Hibernia REIT has announced a deal to buy The Forum building in Dublin’s IFSC from an affiliate of Atlas Capital Group for a price of €37.8m in an off-market transaction.

Constructed in 2003, the building is situated on Commons Street and comprises 47,109 square feet of office accommodation over two floors above four floors of car park space. The offices are fully let to Depfa Bank on annual rent of €40 per sq. ft. on leases which expire in 2029, with options to break in 2019. The total passing rent from the offices, together with 50 parking spaces also let to Depfa, is €2m per annum. The remaining 320 car parking spaces are currently utilised by Park Rite, paying €675k per annum, on a lease that has formally expired. Lease discussions are on-going with the tenant.

The Forum is Hibernia’s tenth acquisition since listing. The deal is expected to be completed in late 2014.

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SCSI calls for extension of Home Renovation Scheme to Commercial

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The Society of Chartered Surveyors of Ireland (SCSI) has called for an extension of Home Renovation Scheme (HRI) to Commercial Properties following a survey which was carried out. SCSI has called for a number of measures to boost the supply of new commercial property, including the introduction of a Builders Finance Fund (BFF) and a Revolving Infrastructure Fund to support the availability of development finance.

The survey also shows a 5th of commercial property owners applied for a rent reduction in the last year, of those that applied 42% achieved a reduction of up to 10%.

Please see PDF report:

New Commercial Property Survey from Society of Chartered Surveyors Ireland

KPMG prepares fresh sales process for IBRC’s unsold projects

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KPMG has repackaged all €2.4bn unsold IBRC non-performing loans (NPL) in three separate portfolios, dubbed projects Amber, Quartz and Pearl, in a set of fresh blind auction processes which are targeted for staggered closures before the year end.

PricewaterhouseCoopers has been assigned to advise KPMG, the joint special liquidator of IBRC, on the re-attempted sale of the loans which failed to meet the minimum price threshold as set by Ireland’s Minster of Finance, Michael Noonan in May last year.

The re-packaged NPLs are now comprised as follows:
– The €675m Project Amber, comprised of Irish corporate and commercial property loans
– The €1.1bn Project Quartz, comprised of commercial property loans
– The €655m Project Pearl, comprised of predominantly Irish residential mortgages.

Project Amber is the first of the three re-issued NPLs to be marketed, with the sales process having started last week, according to the Irish Independent. The sales process for Projects Quartz and Pearl are expected to begin next month.

A successful sale of projects Amber, Quartz and Pearl would facilitate the completion of IBRC’s accelerated wind-up, as decreed by Ireland’s parliament in early February 2013 after emergency overnight legislation was passed in the Dáil, Ireland’s parliament, and KPMG’s Wallace and Richardson replaced IBRC’s Board.

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REIT acquires €130m credit facility with Barclays

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Property investment company Irish Residential Properties REIT plc (Ires Reit) has entered into a two year €130 million credit facility arranged by Barclays Ireland, secured against the company’s assets, which will allow the company to grow and achieve its investment goals.

The firm, which is a subsidiary of Toronto-based Canadian Apartment Properties Real Estate Investment Trust (CAP REIT), followed Hibernia REIT and Green REIT onto the Irish Stock Exchange in April, when it raised €200 million. Its focus is on buying and managing investments in the apartment blocks in urban areas across in Ireland.

In June Irish Residential Properties REIT plc acquired a block of 84 luxury apartment suites adjacent to the five-star Marker Hotel in the Grand Canal Dock area of Dublin for €50.1 million.

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Irish Exports: Recovery in 2014 taking hold

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Trade data for the first five months of 2014 show that exports volumes grew by 4.3% on the same period in 2013.  Indicators suggest that the Irish manufacturing sector has benefited from stronger external demand, particularly from the UK.

It is reported that some 62,900 sq.m (677,049 sq.ft) of space was transacted in Q2 – almost double the activity in Q1 – bringing the volume of industrial space transacted so far in 2014 to 95,000 sq.m (1,022 million sq.ft).

For more information on available Industrial facilities please contact Niall Brereton on 01 6477 900

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Barclays Bank wins loan financing mandate for Oaktree Capital

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Barclays Bank has won the £335m whole loan financing mandate for Oaktree Capital Management and Patrizia Immobilien’s joint acquisition of the three-strong MEPC UK business parks portfolio.

Oaktree, which is the majority equity investor with at least 90% of the joint venture share, has selected Barclays after a competitive financing process which included a number of investment bank underbidders including Citigroup, Deutsche Bank and Bank of America Merrill Lynch.

The three regional business parks are spread over 4m sq.ft of mixed-use space leased to 510 tenants.

  • The 2m sq ft Hillington Park in Glasgow
  • The 1.2m sq ft Birchwood Park in Warrington, 20 miles east of Liverpool, 20 miles east of Liverpool
  • The 820,000 sq.ft Chineham Park in Basingstoke, 17 miles south west of Reading, which includes MEPC as a tenant.

Oaktree and Patrizia confirmed the closure of the initial all-cash acquisition on Monday, reflecting a net initial yield of 7.3%, while the debt refinancing is scheduled for 25th September,  one week after the Scottish referendum which potentially represents a currency risk in the event of a break-up of the UK.

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Line-up of tenants battle over Grafton Street

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Only four months after opening the Cos fashion store on Dublin’s Wicklow Street, the giant H&M fashion group has emerged as the favourite to put another of its luxury brands, & Other Stories, into the former A|wear shop on Grafton Street. The letting is likely to be confirmed later this month.

The line-up of tenants chasing the three-level floor plates at 26-27 Grafton Street includes American fashion chains Gap, Gant and Anthropologie, UK shoe retailer Schuh, the Spanish Inditex company, Zara Home, German fashion house Hugo Boss, the Irish-based Lifestyle Sports as well as & Other Stories. Some of the companies chasing the premises are understood to have offered at least €50,000 more than the quoted rent of €850,000 per annum.

The five-storey over basement building has the second largest retail area on the street after BT2 – apart from the department stores – with more than 882 sq.m (9,500 sq.ft) at basement, ground and first floor levels. The owners of the building, Aviva Investors, are planning to carry out a major upgrading of the block early next year including the installation of a new façade. In the meantime, the retail area has been let to HMV on a short term lease until next January at a rent which equates to €750,000 per annum. With the three top floors of offices extending to 836 sq.m (9,000 sq.ft) also to benefit from the refurbishment.

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RBS shortlists for Project Achill Final Round

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Royal Bank of Scotland has selected a shortlist of three private equity funds and one investment bank – Lone Star, Cerberus Capital Management, Oaktree Capital Management and Deutsche Bank – to progress to the second and final round for the nominally-valued €1.2bn Project Achill portfolio, following first round bids which were submitted on 1 August. The four finalists are understood to have bid for the majority of Project Achill, which comprised 31 separate borrower connections over six subpools originally extended to Ulster Bank, an RBS subsidiary.

The underlying properties within Project Achill include:

  • Belfast’s upmarket The ARC Apartments with 207 units at Titanic Quarter and the 130,569 sq.ft Gateway Offices, which is 90% leased to Citigroup to June 2024
  • A loan secured by the Forge Shopping Centre in Glasgow; the Ards Shopping Centre in Newtownards, 10 miles east of Belfast; Waterfront Plaza in Belfast, anchored by PwC and Mallusk Industrial Estate in Newtonabbey
  • A suburban Dublin office and retail portfolio over 118,669 sq.ft, including 1-5 Leopardstown Retail Park and Unit 33 Sandyford Office Park
  • The IBIS & Novotel Hotels in Friar Street, Reading
  • A Primark retail store at 62-74 Burleigh Street in Cambridge
  • Russell & Bromley’s store in Princes Street, Edinburgh
  • Independent House, Talbot Street in Dublin (which is home to the Irish Independent)
  • Exchange House in Belfast
  • Blackrock Business Park in Blackrock, Ireland
  • 16 completed residential units in Skerries and Malahide; a 128-acre land site with planning permission in Kinsealy, Skerries and Bettytown; 25 Merrion Square, an office block in Dublin; and 15 houses in Barnageeragh
  • A 16-strong mixed-use portfolio comprising residential, retail and office assets in Cork over 218,079 sq.ft, with a 74.5% occupancy

It is understood that second round biding bids on Project Achill, which is being sold by Eastdil Secured on behalf of RBS, have been called for Friday 19 September.

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New partnership in Northside Shopping Centre

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Patron Capital Partners has formed a new retail and residential partnership with Brian O’Callaghan, the son of well-known Cork developer Owen O’Callaghan.

Patron has already begun working on its first joint project with Mr O’Callaghan to operate and expand the Northside Shopping Centre on the northern fringe of the M50 in Coolock, Co Dublin.

The UK and Luxembourg property fund with €2.5 billion under management acquired the centre in May from NAMA. The shopping centre was a key asset in a portfolio of loans “Project Drive” bought by Patron, which are associated with developer Brian O’Farrell. Project Drive had an outstanding loan balance of €228m which implies an approximate discount of 78.5%. Other assets in the portfolio include a retail centre in Poland, a potentially valuable site in north Dublin and a large house in the K Club.

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Eircom plans transfer to Jersey

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Eircom has announced plans to transfer the assets and liabilities of its main operating company to a new entity incorporated in Jersey. Last April, Eircom announced it was undertaking a formal review, advised by Goldman Sachs, Rothschild and Morgan Stanley, of its future “strategic options”, including a possible flotation that could value it at between €2.5 – €3 billion.

The former State-owned company announced that is considering another listing on the stock market, which would be its third in the space of just 15 years. The government initially floated the company in 1999 only for it to subsequently return to private ownership two years later, before being re-floated in 2004 for another two-year period. It emerged from bankruptcy protection in 2012 after a 40% debt write-off worth €1.8 billion.

Microsoft to build Mega HQ in Leopardstown subject to levy

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Us computer giant Microsoft has been granted permission to build new headquarters in Leopardstown in Dublin to accommodate up to 2,000 staff, subject to €8m council levy.

The proposed office development on a three-hectare site at South County Business Park on Leopardstown Road would have to meet 35 conditions set out by the council’s planning department.

The total gross floor area of the concrete structure is at 34,554 sq.m. There would be 558 car parking spaces, with 343 on surface level. The basement would also include 24 motorcycle spaces and bicycle spots.

Dún Laoghaire-Rathdown council seeks funds for parks, roads and public transport. If permission is granted, the development will commence in late 2014 and be fully operational in two years.

Shelbourne Hotel acquired by US property investment group

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The Shelbourne Hotel has been acquired by US property investment group Kennedy Wilson, which is planning to invest millions of euro into the business to build on its status as the top five-star hotel in Dublin. This will include a facelift for the hotel’s facade, which is considered a “priority project”. Plans are also being developed to add a hair and beauty salon to its existing spa facilities, and to refurbish its 19 suites and public areas.

Ownership of this prized asset has switched from Jerry O’Reilly and John Sweeney, the remaining owners from a consortium that acquired the hotel in 2004. Other members of the consortium included Bernard McNamara, who was recently declared bankrupt in Britain.

The receivership has no impact on the operation of the hotel, with all sums owed to staff, trade creditors and the Revenue Commissioners to be paid in full by the new owners.

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€6m for Grade A North Park offices in Dublin 11

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Agents Katie Williams and Rod Nowlan of Bannon are guiding €6.2 million for an office investment at the entrance to the North Park on the North Road in Dublin 11 which will show a return of 8% with an opportunity to better that figure on letting vacant space and completing rent reviews.

The J5 Plaza extends to 5,834 sq.m (62,796 sq.ft) excluding basement which has 252 car parking spaces. The investment is currently producing €518,465, with 77% of it coming from the HSE.

Värde Partners wins NAMA’s Acorn portfolio for over €170m

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Värde Partners outbid a joint venture of Burlington Real Estate, the reborn management team from Treasury Holdings, and US hedge fund Davidson Kempner to acquire the Acorn portfolio from NAMA for more than €170m, 30% above the initial asking price.

The Acorn portfolio is comprised of three provincial Irish shopping centres, delivering €13.18m of rent from 120 tenants.

The assets are:

  • The Blackpool Shopping Centre and Blackpool Retail Park in Cork
  • The Millfield Shopping Centre in Balbriggan, Dublin
  • The Showgrounds Shopping Centre in Clonmel, County Tipperary

The Irish shopping centre market has been dormant for six years, with the only post-crisis sale of the 72.8% stake in Liffey Valley sold by Aviva Investors to HSBC Alternative Investments Limited (HAIL) and Hines for €252m. However, Liffey Valley is a stabilised Dublin shopping centre, compared to the Acorn assets’ more provincial locations.

Bannon and Jones Lang LaSalle were selling agents for the Acorn portfolio on NAMA’s behalf.

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Deutsche Bank pays €145m for €400m Project Spring portfolio

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Deutsche Bank has won a portfolio of €400 million worth of property loans linked to the developer Gerry Conlan from the National Asset Management Agency (Nama).

Project Spring includes loans secured on several prominent buildings in Dublin city, including several attractive redevelopment opportunities. It includes loans attached to an office block on Wilton Terrace near Leeson Street bridge, the Central Hotel on Exchequer Street, the Newhall Retail Park in Kildare, prime London city offices, and a development site near Britta’s Bay in Wicklow. Project Spring’s annual rent is circa €8m.

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