European states raise just €1.1bn in property sale
But estate agents CBRE hopeful of strong demand for Irish sell-off
NEW figures show governments across Europe raised just €1.1bn from property sales last year, but estate agents CBRE yesterday insisted there would be a "lot of demand" if the State auctioned off some of its buildings.
The paltry sum raised from property sell-offs in 2010 was revealed in an update from CBRE, which showed that the bulk of sales had taken place in Sweden (€418m) and the UK (€264m). The contribution from Ireland was zero.
The new Government has committed itself to selling off state assets as part of a bid to restore Ireland's finances. While much of the focus so far has centred on semi-state companies, properties are also expected to come onto the radar.
A spokesman for the Office of Public Works, which holds much of the State's property assets, said it was "actively" looking at ways to "rationalise" its properties but declined to give further details.
Richard Holberton, CBRE's research boss for the Europe, Middle East and Africa region, said demand was likely to be "stronger for assets still needed for operational purposes".
The OPW's portfolio includes scores of offices that are leased by government departments and other state organisations, and could in theory be used for 'sale and lease back' deals.
"The OPW has a lot of good, performing assets," said Marie Hunt, CBRE Ireland's research director. "There would be a lot of demand for those, particularly if there are long leases involved."
While the Northern Ireland authorities have confirmed plans to sell £500m (€576m) worth of properties by 2014, no similar commitment has been made by the Government here.
"[The] OPW continues to monitor its portfolio of owned properties with a view to identifying vacant, under-utilised and underdeveloped property that is surplus to OPW's requirements," a spokesman said.
"Details of the actual properties that the OPW proposes to surrender are commercially sensitive."
He declined to be drawn on the prospect of sale and lease back arrangements, but said that the office was "actively" examining ways to "rationalise" its portfolio.
The agency sold more than 50 properties between 2004 and 2010, raising €379m but the spokesman said he "couldn't comment" on the value that could be unlocked by further sales for "commercial reasons".
The biggest ticket item was the former Veterinary College on Shelbourne Road, Dublin 4, which raised €171.6m in 2005, while €35.9m was raised from an adjacent faculty building.
Other sales included 72-76 St Stephen's Green for €52.3m in 2004, Lad Lane on Baggot Street for €22.5m the same year, and a property on St John's Road, Dublin 8, for €45m in 2005.