Property digest: Dried-up liquidity stalls investment
AROUND €465m of investment transactions were concluded in the Irish market in the first nine months of 2008, according to latest figures from CB Richard Ellis. This is compared to a total spend for the first nine months of last year of €1.6 bn.
"The dearth of transactions relative to recent years is evidence of the lack of demand for investment properties in a market where bank funding has effectively dried up and where buyers remain cautious," CBRE investment expert Sean O'Brien comments.
"Despite a lack of transactional evidence, we believe that prime yields in Ireland have effectively increased by up to 200 basis points in all sectors over the last 12 months. We believe that prime retail high street yields are now approximately 4.5pc; prime shopping centre and prime office yields are 5.5pc and prime retail warehouse and industrial yields are approximately 6.25pc."
Mr O'Brien sums up that the investment climate is "very challenging and is likely to remain so until such time as liquidity improves". However, he states that a small number of investors are now starting to express interest in purchasing assets and expects that a number of investment transactions will be agreed over the coming months -- particularly if the punitive 9pc stamp duty barrier is removed.
€70m property package
Property consultants CB Richard Ellis have now formally launched the sale of three Dublin office properties on behalf of Irish Life Investment Managers. The three buildings (for sale by private treaty) are expected to realise in excess of €70m and are on offer with individual price tags of €20m for Nutley House on Merrion Road; €36m for Hambleden House, Pembroke St and €14m for Wilson House, Fenian St.
"This follows numerous unsolicited approaches on various properties in their portfolio," CBRE director Colm Luddy relates. "Irish Life have concluded that the best way to secure sales is to offer the properties to the wider market and afford all potential buyers the investment opportunity."
The agents reveal that Nutley House weighs in with a current yearly rent of €1,129,760. Hambleden House is currently producing €1,725,186 a year, which CBRE estimates could increase to €2,100,000 following rent reviews. The current annual rent at Wilson House is €877,600, and is expected to increase to €910,000 following the letting of a small section of the currently vacant ground floor.
SCS future shock
HOW is the current crisis in the global economy going to affect Ireland and what is the future for this country, particularly in relation to property investment and the construction industry generally?
These burning issues will be the subject of the forthcoming Society of Chartered Surveyors annual conference -- under the highly topical theme 'Ireland's Future in the Global Economy'.
The full-day conference will take place on October 17 at the O'Reilly Hall in UCD.
It will feature a distinguished panel of industry professionals -- including David Drumm, chief executive of Anglo Irish Bank; Professor John Fitzgerald, research professor at ESRI; Tom Costello, managing director of SISK; Professor Stig Enemark, president of the FIG (International Federation of Surveyors; John Bruder, managing director of Treasury Holdings Ireland; and David Strahan, author of 'The Last Oil Shock -- A Survival Guide to the Imminent Extinction of Petroleum Man'.
The conference is being supported by commercial sponsorship for the first time this year, with insurance companies Marsh and Travelers coming on board as conference partners.
Additional associate sponsorship is being provided by Mason Hayes+Curran and Omega Financial Management.
The attendance fee is €250 for associate members; €175 for probationers; and €300 for non-members, to include conference and lunch.
Further details are available from the SCS. Tel: 01 676 5500 or email greynolds@scs.ie
Surveyors' gala night
THE Young Chartered Surveyors (YCS) annual gala ball will take place at the end of next week.
This year's event is being held at The Alexander Hotel, Merrion Square, Dublin 2, on Friday, October 10.
YCS organiser Yvonne Kiernan of Colliers Jackson-Stops urges members of the division to secure their place early as numbers are restricted to just 400.
Tickets at €60 each for YCS members can be booked via email surveyorsball@scs.ie. Details are available from Gillian Reynolds at SCS headquaters, Telephone: 01 6765500.
Manager of the Year
The construction manager of the €300m Elm Park development struck gold in the latest Construction Manager of the Year awards.
Hats off to Michael McCormack of Michael McNamara & Co. who scooped the top prize in this year's roll of honour.
The CIOB/Roadstone awards are among the most prized accolades in the industry, honouring the professionalism of our construction managers -- especially their ability to deliver projects on time, within budget and to very demanding standards.
Presenting the awards, Robert Hartie, chairman of the CIOB, declared: "Michael McCormack is the deserving gold winner on this occasion, scoring highly in technical competence, leadership, planning, innovation, financial management, quality and, above all, safety. Michael's performance on this high-profile project was truly exceptional."
The 2008 awards were presented in five categories. Other winners included Michael O'Donovan of John Sisk (Cork School of Music); Eoin Flanagan of P J Hegarty & Sons (Thornwood apartments, Dublin); Darrell McGuckian of Farrans Construction (Altnagelvin Pharmacy & Laboratory Service, Derry) and Derek Byrne of DBFL Consulting Engineers (Wyckham Way road widening, Dublin).
- Con Power
