Saturday 25 November 2017

Hammerson and Allianz win the race for Project Jewel

Project Jewell loans are tied to Dundrum Shopping Centre, pictured, and two other centres in Dublin.
Project Jewell loans are tied to Dundrum Shopping Centre, pictured, and two other centres in Dublin.
Peter Flanagan

Peter Flanagan

One of the biggest property firms in the UK has teamed up with the German giant Allianz to buy loans tied to the Dundrum Town Centre and two other shopping centres in Dublin.

London-based Hammerson and Munich's Allianz Real Estate are understood to have been named as the preferred bidder for Project Jewel - a portfolio of loans backed by the Dundrum Town Centre, a 50pc stake in the Ilac Centre, and the Pavilions centre in Swords.

It also includes debt tied to a parcel of land adjoining the Dundrum centre that has been earmarked as the site for an extention of it.

The portfolio is valued at around €1.6bn, with the Dundrum loans worth an estimated €1.1bn on their own.

While being named preferred bidder does not mean the deal is closed, it means the sale will conclude barring a major issue.

The agreement may be announced as early as this morning.

If it does, it will mean that Hammerson and Allianz willhave seen off a rival bid from US investment firm Hines and the Kuwait Investment Authority.

The agreement will bring to a conclusion a saga that has been going on for more than a year. The centre was developed by Joe O'Reilly's Chartered Land during the Celtic Tiger and quickly rose to become the number one retail asset in the country.

However the loans that financed the centre were ultimately transferred to Nama. The agency has been preparing the loan sale since last summer before kicking off the process earlier this year.

The deal will see the London-listed Hammerson make their first foray into the Irish market during this cycle. The retail specialist controls 59 shopping centres and retail parks in the UK and mainland Europe.

The firm is seen as a generally conservative player that takes a hands-on approach to its properties. It has a stake in Value Retail, the owner of the Kildare Village.

Allianz Real Estate, meanwhile, is no stranger to Ireland. The firm invested €140m with IPUT almost exactly a year ago.

Both firms are likely to hold talks with Chartered Land sooner rather than later.

While the deal will effectively end Chartered Land's relationship with Nama, the firm's relationship with Allianz and Hammerson will be closely watched.

Last year US firm Blackstone bought loans tied to developer Michael O'Flynn. That deal ended up in court however after Blackstone attempted to take control of the O'Flynn Construction business.

Irish Independent

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