REIT shares rocket 10pc on first day of trading
Shares in Ireland's first real-estate investment trust soared on the first day of trading in Dublin yesterday.
Shares in Green REIT, currently a cash shell after raising €310m last week in a share placement, closed up 10pc at €1.10 in Dublin with more than 2.3 million shares changing hands.
Finance Minister Michael Noonan made changes in last December's Budget to encourage REITs as an investment vehicle. The National Asset Management Agency said earlier this week that is also expects to create a similar vehicle while Mr Noonan predicted several other REITs will also seeking listings this year.
Green REIT placed 300,000 shares on the Irish stock market at €1 per share in its initial public offering.
"Essentially, Green REIT is a play on a property recovery in the Irish economy and management expertise to identify and extract value from this recovery," said Dermot O'Leary, chief economist at Dublin-based Goodbody Stockbrokers. "The Dublin commercial property market has attracted significant interest from international investors over the past 12 months," he added.
Green REIT aims to increase the size of its fund by borrowing around one-third of its equity and focus on buying commercial real estate in Dublin, according to non-executive director Stephen Vernon.
Green REIT's managers include Mr Vernon, Pat Gunne, Mark Munro, Paul Culhane and Jim McKenna who all bought shares along with Green Property Holdings.
The trust intends to exploit demand for offices and commercial buildings in central Dublin. The IDA warned earlier this week that Dublin lacks suitable office space for the rising number of foreign companies that want to set up here.