Irish Residential Properties Reit (Ires) generated net income of €5.5 million between July and the end of September 2016. This compares to €3.6 million for the same period last year, a gain of 53 per cent. This was largely due to acquisitions and strong organic growth, the company said in a trading update.

"There is a pipeline for growth available through further sales by the National Asset Management Agency and private off-market transaction opportunities as well as the development of apartments on currently owned sites," it said.

During the period, Ires acquired 89 apartments with 145 parking spaces at Coldcut Park, Clondalkin, Dublin 22 for €18.3 million, bringing its total number of apartments to 2,377 and the total invested to €596 million.

It has also submitted a planning application to Dún Laoghaire-Rathdown County Council for the construction of 492 apartments and a commercial space at Rockbrook, Sandyford, Dublin 18.

It said the development of 68 apartments at Beacon South Quarter, Sandyford was progressing to plan.

Occupancy levels

The group maintained high residential occupancy levels of about 99 per cent. In the first nine months of 2016, about 8 per cent of apartments renewed and 19 per cent of apartments turned over to new tenants.

For the 2016 accounting period, the board intends to pay a dividend in March 2017.

In a note, Davy estimated rents as a percentage of average monthly earnings in Dublin were between 35 and 40 per cent.

“With annualised rental growth of 9 per cent, management’s ability to generate further organic growth will be influenced by the pace of wage inflation through 2017,” it said.

“We remain positive on Ires given the deep imbalance between demand and supply in Dublin’s housing market, the quality and location of its 2,377-unit portfolio and the group’s 560-unit development pipeline which could add €8.8 million in gross rents.”