A Canadian activist investor in Ires Reit, which is agitating for the Republic’s largest private residential landlord to put itself up for sale, has called on the company to stall a near-term €100 million asset sales plan as it emerged that it is looking to sell its upmarket Marker apartment block in Dublin’s docklands.
Sources confirmed a report in property publication React News that Ires has engaged agent Hooke & MacDonald to run the sale of The Marker Residences, comprising 85 luxury two-bedroom apartments in Grand Canal Dock, with a price tag of about €70 million.
Ires also recently agreed a €20 million sale of its Rockbrook development site in Sandyford, Dublin 18, which has planning permission for more than 400 apartments — having abandoned plans to build the units itself.
Vision Capital
“The recent sale of the Rockbrook development site and the reported proposed sale of one of its highest quality assets, The Marker, represent the sale of two of the ‘crown jewels’ of Ires,” Toronto-based Vision Capital, the activist investor that owns 5 per cent of the company, said in an open letter to fellow shareholders on Monday, its second in two weeks.
“We urge Ires’s board not to proceed with any further asset sales at this juncture until a clear, longer-term strategy that benefits from shareholder-aligned board of directors representation is advanced and communicated.”
Ires bought The Marker Residences block in 2014 for €50.1 million. The Rockbrook site has been sold to the Galway native Comer brothers and is located beside the unfinished boom-era Sentinel building, which the developers bought in 2011 and are hoping to turn into a block of apartments.
Vision Capital has been urging investors to vote against the re-election of Ires chairman Declan Moylan, and three other directors, at an annual general meeting (agm) next month for resisting its efforts to have the business put on the market, as its stock trades at a deep discount to its inherent value.
However, the company, led by chief executive Margaret Sweeney, said last week that it is not clear whether now was the best time for a sale, with valuations under pressure across the European real estate investment trust (Reit) sector.
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Rising interest rates caused residential Reit and real estate investment company discounts to net asset values (Nav) to widen from nil to a median of more than 40 per cent during 2022, according to the European Public Real Estate Association, ISS noted. Ires’s current discount to Nav is in line with the wider sector.
Ires’s plan to raise €100 million from asset sales in the near term is aimed at ensuring that it maintains sufficient headroom over legal and financial debt covenants in a market of declining commercial property values.
Ires’s loan-to-value ratio stood at 43.8 per cent at the end of December — compared to a 50 per cent limit under Irish Reit legislation and the company’s own lending covenants.
Reacting to Vision Capital’s latest open letter, Ires said that it has no further comment to make, other than that the board was focused on “value maximisation” and that it continues to “unanimously” recommend in favour of all proposed agm resolutions.
