Blame the Government for housing crisis - REIT boss
Hibernia REIT chief Kevin Nowlan has launched a broadside at the Government and local authorities, accusing them of failing to understand the difference between apartments intended for the rental market and ones that "people live in".
Speaking at the Real Estate Stakeholders Debate Brexit summit, of which the Irish Independent and 'Sunday Independent', are media sponsors, at the RDS in Dublin yesterday, Mr Nowlan called for an end to the blanket requirement for dual aspect [views] in apartments.
He also called for the introduction of a wider range of apartment sizes to cater for the differing demands of renters and owner occupiers.
Laying the blame for the deepening housing crisis on the State, he said: "There's some very simple things that could be done but for some reason our local authorities have a difficulty in understanding the difference between rental stock and apartments that people live in. They're different.
"In Ireland, local authorities think there are only one-bed, two-bed and three-bed apartments and that's it.
"If you go to the UK, you'll see the different asset classes they have in terms of flats. They understand it's about usage, about occupancy levels and what people need those units for."
Citing the example of workers in Dublin's docklands, Mr Nowlan added: "The majority of the people who want to live in our docks area are generally younger people who don't spend a lot of time in their apartments.
"They don't need to be protected by dual aspect and 80 sq m [floor areas because they don't spend a lot of time there. We need to understand this and get a little more sophisticated with our residential [planning regulations]".
The Hibernia chief said while there was an "amazing, huge amount of demand for rental stock", government, planners and local authorities have been "unable to engage" with the issue of rent affordability.
"If you look at London, I can build a two-bed apartment and it has to be 61sqm; in Dublin, it's around 80 sq m. In London, I don't pay any VAT on construction; it's zero-rated. And in London, the affordability criteria for what people can afford to rent is higher. So these are the issues we're dealing with."
Mr Nowlan said changes needed to be made to the dual aspect requirement for apartments and that floor area sizes would need to be made "more consistent". The VAT rate on construction would also have to fall to allow for the creation of a stock of "well-managed residential apartment blocks".
"The organisations are there to do it now, I-RES is there, we're interested in it and the pension funds, they won't deliver it, but an organisation like Hibernia could deliver them on and sell them on after making a profit."
In a further criticism, he added: "State land is everywhere and it's not being managed. It needs to be freed up. It's all over the city centre and it's simply being hoarded."
The ongoing shortage of suitable residential accommodation in Dublin was raised by several of the keynote speakers at yesterday's Brexit summit with Colm Lauder of Goodbody's real estate division identifying it as a particular issue for UK firms who may seek to relocate here.
Meanwhile, Sean Mulryan's property firm Ballymore has launched a new business district in Dublin's docklands.
The million square foot development, dubbed Dublin Landings, will include five new office blocks and 273 luxury apartments. Dublin Landings, which will see the National Treasury Management Agency (NTMA) as its first tenant, is located on North Wall Quay.
Development rights for the 2.35 hectare site were secured by Oxley Docklands Quay Ltd, who have partnered with Mr Mulryan to build the project over the next four years. "The calibre of tenants expressing interest in Dublin Landings is a testament to the quality and scale of the development," Mr Mulryan said.
Construction of the first two blocks is already under way, with the entire lifetime of the project set to create 2,000 construction jobs. Walls Construction has been appointed as main contractor for block one and two.
"We have great confidence in the Dublin market and particularly the central business district. This unique mixed-use site is unlike any other in Dublin and we look forward to working with Ballymore," said Oxley chairman Mr Ching Chiat Kwong.