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Sunday 19 November 2017

Ex-Treasury chiefs to raise cash for property buyout

Bruder and Kavanagh plan launch of their new Irish REIT

John Mulligan

John Mulligan

Former Treasury Holdings executives are plotting the launch of Ireland's next real estate investment trust (REIT), the Sunday Independent has learned.

Such a fund would need to raise hundreds of millions of euro in order to establish a meaningful property asset investment base.

Burlington Real Estate, a company headed and co-founded by former Treasury chiefs John Bruder and Niall Kavanagh, is eyeing REIT possibilities in order to take advantage of intense international interest in commercial property in the capital.

Burlington manages assets that were formerly controlled by Treasury Holdings, the property goliath that was established by Johnny Ronan and Richard Barrett.

Treasury was placed into receivership in 2011 by Nama, owing about €1bn.

Mr Bruder was chief executive of Treasury Holdings Ireland, while Mr Kavanagh was director of property at the firm. With experience of handling large-scale properties, Burlington would be considered one of the few firms with the ability to successfully establish a REIT and attract backing.

The pair established Burlington Real Estate in 2012. It manages a number of large properties around Dublin, including the massive Central Park development in the south of the city that was recently sold by Nama to a joint venture between Green REIT and US property giant Kennedy Wilson.

US global investment group PIMCO helped to bankroll the deal, which saw Central Park sold for €311m – about 24 per cent more than Nama originally advertised the development for.

Green REIT was Ireland's first real estate investment trust. It floated on the stock market last summer having raised €310m. It's backed by investors including Pimco and US investment giant Franklin Templeton, as well as Green Property executives Stephen Vernon and Pat Gunne.

Another REIT, Hibernia, raised €385m when it floated on the Irish stock exchange in December. Last month, it completed its first acquisition, paying €67m for a portfolio of loans secured on a mix of mainly residential properties in Dublin.

Neither Mr Bruder nor Mr Kavanagh was contactable, but it's understood that Burlington is keen to capitalise on the wall of investment money that has been directed towards the Irish property market by international players over the past year or so.

The pair would also be likely to invest their own personal funds in a new REIT if they proceed with the venture.

Ireland's largest hotel group, Dalata, floated on the stock market last week after raising €256m that will be used to buy as many as 25 hotels in Ireland. It marked another landmark in the resurgence of interest in Ireland's economy.

Meanwhile, Johnny Ronan is understood to be close to repaying his personal company debts and embarking on a fresh assault on the property market. He's being backed by Development Securities, a company listed on the London Stock Exchange

Sunday Indo Business

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