Sunday 16 December 2018

Irish Life readying plans to enter residential property market this year

Gavin McLoughlin

Gavin McLoughlin

Irish Life is readying plans to enter the residential property market this year.

The company, which is very active in commercial property, is now planning to deploy pension funds towards build-to-rent projects, including student accommodation.

Patrick Burke, managing director of Irish Life Investment Managers, said the company’s plan is to be a capital investor in specific projects rather than taking stakes in housebuilding companies.

He said it would look to team up with other parties with “long-term sustainable proven track records”, without attaching itself to one particular developer or company.

Mr Burke said there was no announcement of a project imminent but that Irish Life hopes to make investments in the next 12 months.

The company was previously active in the sector and found itself embroiled in a scandal in the 1990s when it sold the Mespil apartments in Ballsbridge to private investors. Some tenants of the apartments were subsequently served with notices to quit and others faced large rent increases. The State had a stake in Irish Life at the time.

Meanwhile, the head of the company’s health insurance business said there is likely to be further upward pressure on premiums in the market this year - partly due to an ageing population - though not as much as in previous years.

“We know there’s a lot of upward pressure from all of the providers in the system, private hospitals and consultants and so on, to increase their charges. That’s going to put some more pressure on it. And then medical inflation, new products and new technologies and so on, push it up,” said Jim Dowdall, who joined Irish Life after the company bought his business Glo Health.

“Don’t expect that the increase this year will be of the scale of increases that we would have seen in previous years,” he added, saying it was difficult to put a figure on what kind of an increase customers might expect to see. Mr Dowdall said the company itself had “no plans for any price increases at this stage”.

Yesterday Irish Life presented a survey that found 35pc of Ireland’s population expect to rely on the State pension as their main source of income in retirement. Irish Life retail managing director Denis McLoughlin said: “While four in five people agree that as a nation we’re not saving enough for a decent quality of retirement, only one in four adults is planning towards a specific level of retirement income.

“More than twice as many over 45s expect to rely on the State pension as their main source of retirement income compared to millennials.”

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