Friday 15 December 2017

Dunnes Stores wants 'high class' co-tenants in Point Village before investing €15m

Dunnes Stores
Dunnes Stores

Tim Healy

Dunnes Stores believes it should only release €15m for the Point Village Development in Dublin once "high class" tenants have been secured for other units in the centre, the Court of Appeal heard.

High class does not include "pop up" outlets like an e-cigarette shop or any barber shop, Martin Hayden SC, for Dunnes, told the court.

Mr Hayden agreed with appeal court president, Mr Justice Sean Ryan, that Dunnes had anticipated the Point Village would be was "more like Dundrum Shopping Centre than Nutgrove (Rathfarnham)."

The court is hearing an appeal over a High Court decision to refuse Dunnes disclosure of documents for the defence of an action by the receivers of Point Village Development Ltd (PVDL) seeking that the supermarket chain release €15m as part of the supermarket chain's deal to become the main, or anchor tenant, in the centre.

The money, the receivers say, is due under a 2010 agreement between Dunnes and PVDL whose chairman Harry Crosbie negotiated the agreement before NAMA appointed receivers over the company in 2013 on foot of a €450m debt.

Mr Hayden, for Dunnes, told the appeal court the documents sought would support their case in relation to high end tenants.

Dunnes' case is that this is the correct reading of the original agreement to develop the Point Village and of the 2010 agreement which was drawn up to settle a dispute in relation to what must first happen before Dunnes would move in as anchor tenant.

That settlement required that binding leases for seven of the other units in the Point would have to have taken out before Dunnes would have to fit out the unit it has been allocated.

Although some of those smaller units are now occupied, and include an e-cigarette shop, a barbers and a coffee shop, Dunnes says some of them do not qualify as high class tenants.

The discovery sought by Dunnes would show that it was always anticipated the other tenants would be high end, Mr Hayden said.

Michael Collins SC, for PVDL,  said the Point Village as originally proposed, was to include what was to be the highest building (102metres) in the country and the "U2 Experience, but these were later dropped.

Both the original agreement and the 2010 settlement did not use the words high class tenants but Dunnes appeared to interpret them as such by a references like "first class" developments like Eyre Square in Galway and Dundrum Shopping Centre. 

In any dispute, the 2010 agreement was to take precedence and all that said was that there were to be seven binding leases in place before Dunnes would fit out its store, he said.

Dunnes had been due to open in the Point nearly ten years ago but did not do so after the economy collapsed. This left a "chicken and egg" situation where smaller tenants did not want to go in without the anchor and the anchor then saying it did not want to go in when the other units were vacant, Mr Collins said.

The Court of Appeal reserved its decision.

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