The investment arm of the group that is the world’s largest Ikea franchise operator hopes to build as many as 250 social-housing units in Ireland with a €100m investment.
Ingka Investments has announced that it is poised to deliver the units over the next three years, with an initial focus on the Dublin area.
The project is being advanced in conjunction with Aurium Capital, which will be responsible for coordinating construction and delivery of the homes. The units will be leased to local authorities on a long-term basis.
The payments made on the homes will effectively be mortgage payments, with the properties eventually being transferred to local authorities at the end of the lease term, at no additional cost.
It’s the first Irish social-housing project that Ingka Investments has been involved in, and possibly one of the first ever the group has engaged in.
The Ingka Group operates 392 Ikea stores in 32 countries, while Ingka Investments has €20bn of assets under management and targets financial returns made on investments that have a positive return for customers and the environment.
Colm Mugan, portfolio manager at Ingka Investments, said the firm is eyeing a minimum of 150 social-housing units with its project in Ireland, but hopes the final figure will be around 250 within three years. The €100m investment will also include site acquisition costs.
He said a “huge focus” for the investment arm is getting value for money and that it wants to deliver the units for around the same price that it would cost the government to do it itself.
“The current environment is tricky,” he conceded, “and we haven’t signed off on any sites just yet. We’re in negotiations with certain developers in terms of land sales and so on.”
The sites it is in negotiations to buy have already secured planning permission.
“We’re very close to closing on a couple of sites,” said Mr Mugan. He said the ultimate number of units built will depend on the final mix of housing on the sites, including apartments and houses.
“We’ll deliver a mix, but we certainly will be looking to get value for money here and it’s a huge emphasis for us,” said Mr Mugan.