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Dundrum centre is tipped for €1bn sale

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VALUABLE ASSETS: Clockwise from left, Dundrum Town Centre, the Gibson Hotel and the Burlington Plaza

VALUABLE ASSETS: Clockwise from left, Dundrum Town Centre, the Gibson Hotel and the Burlington Plaza

Valued in the region of €250m, Burlington Plaza is one of Project Tolka's most significant assets

Valued in the region of €250m, Burlington Plaza is one of Project Tolka's most significant assets

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VALUABLE ASSETS: Clockwise from left, Dundrum Town Centre, the Gibson Hotel and the Burlington Plaza

AS Nama considers ramping up its €22bn loans sell-off and international fund pressure to sell mounts, its most valuable Irish property asset is hotly flagged as a contender to go to market this year.

If put on sale with attached lands, Dundrum Town Centre could fetch up to €1bn and is likely to be extremely strongly bid.

Ireland's biggest shopping centre retail space has loans attached to top Nama developer Joe O'Reilly that are in the toxic loan agency, but there are also borrowings from other banks, it is believed.

The yearly rent roll from tenants including House of Fraser, Harvey Nichols, Penneys and Hollister is in the region of €55m.

This and other prime O'Reilly Nama properties could raise millions from giant international fund bidders like Kennedy Wilson, Apollo or Lone Star.

Some or all of four blocks that include Facebook's new headquarters at Grand Canal Quay are due to market imminently. Nama could raise €250m from these Chartered Land properties. It is not thought likely that Facebook will follow Google's example and acquire the property it's based at.

Nearby impresario Harry Crosbie's former prize assets could be near-term sale targets in any accelerated Nama process, including Yahoo's new three-storey home at The Point Village.

All in all, the Point offices, outlets and buildings where the Gibson hotel and Odeon cinema operate would be priced at around €100m.

The Daniel Leibskind-designed Bord Gais Energy Theatre on the other side of the river is harder to price but is believed to be trading well.

The strategy with the Crosbie assets is understood to be to hold and develop rather than rush and sell, but political motivations could outweigh economic ones if there is pressure to wind down Nama early.

"There's more money to be made by holding on to assets because of the favourable interest rates Nama gets," said one property industry source. "At 50 basis points, the cost of funds for Nama is just 1.5 per cent. It is getting an average return on rental income of around 7 per cent. So, in other words, every year that Nama holds on to an asset it amortises debt by around 3-4 per cent.

"There is much more politics than economics involved in this prospective sell-off. It's the political holy grail: announcing the end of Nama, that you're selling off everything. This is much more a political than an economic rationale."

Other assets likely to attract pressure to come to market from giant funds include the Burlington Plaza, where Amazon has lately moved in and broadcast giant Sky is based, likely to price at €120m. It and a block on Harcourt Street, worth €30m, are connected with Nama borrowings of developers John Flynn and Paddy Kelly. As is Belfield business park, worth in the region of €100m.

A former Treasury Holdings prime asset, Connacht House, located next door to the Kennedy Wilson-owned Bank of Ireland offices, would be expected to guide at €60m.

Cork developer Michael O'Flynn's €1.5bn loan book is seen as a barometer of the clamouring demand that is out there. There are 20 bidders for a book expected to sell for around €1bn, suggesting €20bn of bid capital sloshing around at present. First-round bids are due on March 18 with completion expected in April.

Sunday Indo Business