Tuesday 22 October 2019

Investors are set to contribute €322bn to 2040 strategy

Pat Farrell, CEO of Irish Institutional Property (IIP)
Pat Farrell, CEO of Irish Institutional Property (IIP)
Donal Buckley

Donal Buckley

Institutional capital now accounts for 51pc of all institutional and private investment in property in Ireland, Pat Farrell, CEO of Irish Institutional Property (IIP), said at the launch of the new voice for institutionally financed investors and real estate providers, both Irish and international.

Six IIP companies are represented in the top 20 ISEQ-listed PLCs by market capitalisation and its members currently have €11bn of assets under management in Ireland.

They have also collectively built over 5,500 new homes since 2015, provided 1.3 million square feet of commercial office space since 2016, 127,000 square feet of retail space in the same period and over 600,000 square feet of hospitality space in the last year alone.

"This impressive level of delivery was made possible by our 5,000 direct employees as well as the many thousands more indirect employees in construction, legal, accounting and financial services firms that we work with," Mr Farrell said.

He says that institutional capital provides stable long-term funding to enable sustained delivery of the required supply of critical infrastructure, housing and workplaces.

This contrasts with the Celtic Tiger era when the Irish market was dominated by other investor types such as private developers, private equity and syndicates many of them unsustainably debt funded. The shift is expected to ensure a more stable property market which would be better for the economy.

An IIP analysis shows that while the State will contribute €116bn to deliver the Ireland 2040 plan, institutional and private investors will contribute €322bn or three-quarters of the funding.

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