Friday 13 December 2019

Avalanche of retail sales may follow Blanchardstown

Stephen Vernon of Green Property
Stephen Vernon of Green Property

Peter Flanagan

A slew of retail properties may be rushed to market after Stephen Vernon's Green Property fired the starting gun on a sale of the Blanchardstown Centre next month.

The Blanchardstown Centre will differ from most big property sales in Ireland since the crash because it does not involve Nama and is not a distressed sale in any way. It may prompt a rush of sales in the sector.

While retail has been slow to recover since the crash, the success of the Project Jewel sale and other shopping centres that have been snapped up in recent months indicates a strong appetite internationally for the Irish retail market.

While Mr Vernon is effectively taking his money off the table with Blanchardstown, he remains heavily involved in the listed property firm Green Reit, and this sale is being done at arm's length from Green Reit.

Green Reit is focused mainly on the Dublin office market and has concentrated on so-called "core" real estate since it was set up in 2013.

The firm is involved in numerous developments at present, most notably the redevelopment of 13-17 Dawson Street in central Dublin.

The Blanchardstown Centre, which has around 16 million visitors every year, is expected to attract bids of upwards of €1bn. All the under-bidders on Project Jewel, the €1.8bn loan portfolio tied to the Dundrum Town Centre which sold last year, are expected to bid for the centre.

That would put the Kuwait Investment Authority and its partner US property group, Hines, in the picture, as well as another US fund, Davidson Kempner, and Colony Capital - an investment firm backing Johnny Ronan and Paddy McKillen.

Hines is already involved in one major shopping centre in Dublin, having taken a majority stake in the Liffey Valley Centre for more than €250m two years ago.

Davidson Kempner also has form in the Irish retail sector. Last October it paid out around €170m for the National Portfolio of five shopping parks in Dublin and elsewhere.

UK property firm Hammerson is not expected to bid for the centre, despite winning the race for Project Jewel. Industry sources believe Hammerson will need more time to digest the Jewel deal, and the company is locked in talks with Dundrum developer Chartered Land to decide future control of the business.

Other potential bidders include Varde - a Minneapolis fund that bought the Acorn portfolio of shopping centres from Nama in July 2014.

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