Thursday 26 April 2018

The property market: It's game on as good omens abound

The hotels were packed, Brown Thomas reported its busiest trading days since Christmas Eve and even the taxi drivers were happy, one supposedly bringing US visitors from Powerscourt Hotel in Wicklow on a Ring of Kerry round trip.

The Notre Dame versus Navy college football game attracted 35,000 US visitors to Dublin and served as a tasty appetiser for 'The Gathering', which aims to attract an additional 325,000 visitors to Ireland next year.

And according to commercial property expert Marie Hunt, if successful, the initiative should underpin another improved year for Irish tourism and the hotel and hospitality sector.

Commercial property specialists are expecting a busy autumn selling season with a number of new properties expected to be formally put in the market in the next few weeks.

Ms Hunt, executive director and head of research at CBRE, says the traditional lull happened again in July and August after a fairly successful period of trading in the first six months of this year.

However, there was considerable "pitching activity" under way all summer, suggesting that a significant number of new properties are to be launched for sale over the coming weeks.

She points to encouraging signs in the hospitality sector, buoyed by an increase in visitors to Ireland generally and Dublin in particular.

The 501-bed Burlington Hotel in Dublin 4, has just come to the market with a guide price in the region of €65m to €75m.

She believes the sale of the landmark four-star hotel will be another big test of the Dublin hotel market.

She also expects strong interest from the international hotel investment market given the size of the Burlington and the branding opportunity that "the Burlo" offers a potential buyer.

There are other signs too. Some of Dublin's better-known pubs are currently undergoing refurbishment, which she believes is a "good omen", and sales are now agreed on a number of hotels that were brought to market earlier in the year. These include: Kilkea Castle Hotel in Kildare; the Killerig Hotel in Carlow; the Kincora Hall Hotel in Killaloe, Co. Clare, and the Cork Airport Hotel.

"That proves there are buyers out there for correctly- priced assets," Ms Hunt added.

The investment market is also showing some small signs of recovery.

Prime property values are reaching a floor, according to CBRE, with prime rents and yields showing evidence of stabilisation.

CBRE research suggests that just under €140m was invested in the Irish investment market during the first half of the year in 12 individual transactions.

They believe that eight out of 12 investment transactions involved local buyers but overseas buyers picked up the most expensive properties -- accounting for 76 per cent of the total amount of money spent.

"We believe that overseas investors remain firmly focussed on sourcing prime opportunities in the Irish market," says Marie Hunt.

Jerome Reilly

Sunday Independent

Today's news headlines, directly to your inbox every morning.

Editor's Choice

Also in Irish News