Tuesday 27 June 2017

Prudential Plc seeks NAMA loan finance deal

funding

Emmet Oliver

THE giant UK insurer Prudential Plc is believed to be among a group of companies which have applied to avail of NAMA's first vendor finance deal in Dublin.

Vendor finance is where NAMA provides about 70pc of the finance to buyers to purchase one of its buildings. It is a common structure for property transactions around the world.

US media outlet Bloomberg reported yesterday that six firms have been attracted to bid for One Warrington Place, a property in Dublin city centre previously owned by developer David Arnold. Also bidding with Prudential Plc is Atlas Capital Group, a US real estate company.

NAMA is hoping to sell the property, near Dublin's Grand Canal, for about €25m, meaning the vendor finance would amount to almost €19m. NAMA hopes the vendor finance model will be attractive to buyers as they may see NAMA as sharing some of the risk in the transaction.

The Dublin property market at present is moribund, but a small number of properties have come on stream to test price levels. One key sale is the Alliance Building in the Gasworks development in Ringsend, Dublin 4.

It contains 210 apartments that are rented at an average of €1,300 a month, equating to an annual rent roll of around €3.2m. Grant Thornton are the receivers selling the building once owned by Liam Carroll, a top 10 NAMA developer.

NAMA meanwhile is trying to stimulate the residential property market by also offer- ing negative-equity-protected mortgages. However, these products are not expected to be offered now until the new year.

The original deadline was September, but government sign-off on the idea has taken more time than expected.

The products will be offered on apartments and houses in West Dublin and some parts of Cork, according to sources.

Irish Independent

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