In another mass sale of Dublin apartments, the National Asset Management Agency (Nama) is to seek buyers for 588 homes in six Dublin suburbs and one in the city centre.
Domhnaill O'Sullivan of Savills and Ivan Gaine of DTZ Sherry FitzGerald are guiding €116 million for the portfolio which will be sold either in its entirety or in seven different lots. Around 70 per cent of the apartments are two-bedroom units.
In the event of a single buyer emerging for the Plum Portfolio, they can bank on an initial return of 6.3 per cent from the apartments and 3,370sq m (36,274sq ft) of commercial buildings when they are fully let. The apartments, which are owned by different developers and investors, are at Beechwood Court, Stillorgan; Time Place, Corrig Road, Sandyford; Lad Lane, Cumberland Road; Carrington Park, Northwood Park, Santry; Northern Cross, Malahide Road; Heywood Court, Northwood Park, Santry, and Waterside, Malahide Road.
There is considerable confidence that some or all of the investments will be of interest to several overseas funds and real estate investment trusts (REIT) as well as to some domestic investors because of the potential to add significant value through rental growth, finishing out some of the apartments and letting empty commercial space.
The seven schemes currently produce a rental income of €7.43 million but the agents say this figure could be increased to around €8.7 million through improved asset management. Last August Nama sold 761 apartments in four other Dublin schemes to the Irish Residential Properties REIT (I-Res) for €211 million.
Beechwood Court, developed by Brian Cullen's Jackson Homes just before the property crash, will have the strongest appeal to investors because of its high quality finish and its accessibility just 10 kilometres south of the city centre. The original scheme comprised 316 apartments and a number of houses.
The 101 apartments and a range of commercial units now going for sale are producing an annual income of around €1.5 million.
Interestingly, Beechwood Court is on the opposite side of the Stillorgan Road from the Grange apartment scheme which was developed by Ray Grehan’s Glenkerrin Homes. More recently, Nama brought in builders to finish off around 150 apartments which are also expected to be offered for sale shortly.
Also on offer in south Dublinare 67 apartments in Time Place on Corrig Road in Sandyford which were completed by Michael Burke of Galway-based Burkeway Construction.
He managed to sell a further 23 units before the development ran into financial difficulties. The 67 homes, currently producing a rental income of €995,000, are located beside Beacon South Quarter.
The only city centre development included in the sale is at Lad Lane on Cumberland Street where the now defunct Treasury Holdings acquired 40 apartments used as student accommodation as part of a larger plan to redevelop the area.
The accommodation is leased under a four-year agreement from 2012 to Reservations Network (Dublin) Ltd at €372,000 per annum. An additional €70,000 comes from an adjoining car park.
Nama is also selling 73 apartments and three commercial units in Cannon Kirk’s Waterside development between Swords and Malahide. All the properties are let and produce a rental income of €1.035 million which includes €60,000 from the commercial buildings.
The sell-off will also include two developments in Northwood Park in Santry: 141 apartments built by P Elliott at Carrington Park and 38 owned by Paddy Doyle's Lyndonbarry Developments at Heywood Court.
Fourteen of the apartments in Carrington Park will require capital expenditure to finish them off while the remaining units are producing a rental income of €1.58 million.
There are 38 apartments available in the Heywood Court project which have a rent roll of €425,000.
The seventh development included in the sale, Northern Cross on the Malahide Road which was developed by PJ Walls, has a good mix of commercial buildings as well as 128 apartments.
The residential units are rented at around €1.5 million while the 20 own-door retail units with an overall floor area of 2,833sq m (30,500sq ft) are all vacant.
Savills’ Domhnaill O’Sullivan said the sale presented investors with an excellent opportunity to acquire a significant volume of multifamily units at a time when property prices and rents in Dublin continued to rise.
Ivan Gaine of DTZ Sherry FitzGerald said that in addition to the rent and yield trajectory it was likely that prospective purchasers would underwrite on a break-up value, particularly across developments such as Beechwood Court in Sillorgan and Time Place in Sandyford.
