Business Property & Mortgages

Tuesday 23 September 2014

The Space Age gathers momentum at Allsop auctions

Scenic islands and elegant red bricks have replaced much of the pile 'em high cheap-as-chips apartments at the Allsop Space sale

Published 29/08/2014 | 00:00

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An Allsop auction
Castle Terrace Court, Malahide, Co Dublin with 23 units, 4m euro plus
The Allsop Space Property Auction at the RDS

THE Allsop Space Property Auction rattled cages all over Ireland when the first sale kicked off at the height of the crash in mid 2011, flogging receiver properties for bottom-line prices in mass auctions where 100 sales could be clocked up in an afternoon.

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In a market where many estate agents believed sales were near on impossible, the Allsop Space outfit used the UK crash era experience of the British mass auctioneering firm Allsop to put out stricken properties with the difference that the reserves where disclosed. In a market where no one knew where they stood at an auction because of consistently misleading guideline prices, and where property had become almost impossible to value, Allsop Space shifted vast tranches of property by simply telling people what the bottom line on price was and taking a no nonsense and no pomp approach to the sales event itself.

The first auctions at the Shelbourne Hotel saw extraordinary sights, with auctioneers standing on hotel steps to conduct bidding to crowds on the street while nearby pubs were used as overspill because the booked venue was so full.

Having being sabotaged by protests right up until last year, including one famous shut down auction at the Shelbourne, Allsop Space managed to convince anti repossession groups that it did not sell any repossessed homes. It remains the only auctioneering firm to give such a guarantee.

We saw banks of auctioneers taking one fifth of bids from abroad via internet and telephone.

But most expected the Allsop Space circus to be a flash in the pan and attraction solely for cash-rich 'bottom feeders' which would outlive its usefulness and fade away once the market recovered.

But with Dublin prices rising 2.6pc last month and the rest of the country by 1.3pc, Allsop Space has not only announced its 17th 'monster' auction, but its largest one yet.

On Tuesday, September 16, the company plans to sell 260 properties with an expected total sales value on the day of €60m.

For the first time the auction will be split in two with commercial properties kicking off in the morning from 8.30am and the residential-only sale (comprising the bulk of the properties) to begin sometime after 12.30pm. The all-day session is expected to run until at least 7pm.

Perusers of its latest catalogue will notice that the offerings have changed. The coming auction appears to have attracted a whole new market in the form of the upmarket project home buyer.

It is the key to how Allsop Space has not yet run out of road after more than three years.

"Initially we managed to attract bidders in numbers because were up front with them. The prices were attractive and unlike the Irish private sales and auction process at the time, they could tell exactly what the bottom line price was," says associate director Jonathan Fenn. "We started with almost 100pc receiver sales, but as time went on, other segments of the market realised the advantage to be had in availing of an event which could focus the attention of hundreds of buyers on a property, obtain the best market price for the property and finally, do it in a timeframe that was appealing to them."

Those who have attended the auctions over the three year period will notice that this is borne out by the changing face of the crowd.

In the early days the profile of the typical Allsop Space buyer was a middle to older rural-based farmer spending cash on a Dublin investment property.

Last year attendees will have noticed high numbers of Asian buyers in search of apartments and small business premises. This September the firm expects good numbers of small Irish consortia of three and four investors apiece in search of small shops and big run-down houses in period areas.

"The run of large period houses in Dublin 4, 6 and 8, which we see in the coming auction, is a result of changes in the Pre 63 market. Landlords who might have wanted to hold on to their properties are either reluctant to invest the big money needed to fit them out for new requirements which ban the bedsit, or else they want to diversify from Pre 63 into other types of property." So the vendors could well be back as buyers.

Fenn asserts that making one workable and efficient process available over time means that as the market changes, different sets of vendors and different sets of buyers have come forward to make use of it. Therein is the key to its longevity.

"When we started out, almost all sales were receiverships - now around half are from that source and it is falling all the time. When we started, 90pc of the buyers were purchasing with hard cash - now that's down to about half.

"When we started we were selling ghost estates, now we're also selling entire estates and multiple unit holdings from private investor owners who are not under any financial pressure at all."

Certainly the claim for diversification is borne out by some of the properties in the coming catalogue.

They include Duvillaun, a scenic 55 acre island with its own beach located two and a half kilometres off the Mayo coast. The last residents vacated more than 100 years ago and it has mainly been used for sheep since then. A nearby island got permission for holiday homes which might illustrate the potential and the reserve is €100,000.

Young families will be attending for properties like the three-bed terrace in Stillorgan for €325,000.

Luxury

Meantime many of the interested parties in the D4, D6 and D8 pre 63s are private owner occupiers looking to convert them back to luxury private homes.

"The big properties on the top streets are being chased mainly by owner occupiers who intend to refurb and live in them while those on secondary streets are attracting the previously mentioned small consortia," says Fenn.

For those seeking a home in the capital's most fought-after residential enclave, there's a three bedroom end-of-terrace home at 50 Elmwood Terrace in Ranelagh, Dublin 6 with a reserve of €300,000. The catch is a life tenancy at a rent of €600 per annum.

So what's next for the monster auction company?

"Going forward we're hoping to move further into the mainstream residential market. I've no doubt that we'll still be here in three more years and we'll be selling mostly regular properties," says Fenn.

Meantime, the last of the 'bottom feeders' will be glad to know there are still some bargain vestiges of the crash remaining in the Allsop catalogue. An entire estate of 32 family homes in Carrickmacross, Co Monaghan is reserved at €1m - or around €30,000 each - that's the price of a new family saloon car.

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