It has been another busy property week, with the new selling season definitely upon us but before we get carried away, it’s important to reflect on what is still broken within the system. Over the past week, three people who were classified as homeless in different parts of the country (Dublin, Kildare and Cork) died. Our genuine sympathies go to the families and friends of the deceased. Their deaths must serve as a reminder to us within the industry that while things are picking up again, we cannot allow recovery of the market to dim the lessons learned over the past decade, otherwise we are doomed to fall into past traps. Also, I urge property commentators to be sensitive and balanced when discussing prevailing problems and to take a solution-based approach to commenting on future progress (Independent.ie, that one is for you).
Well done to all the property businesses and professionals who took part in the inaugural ‘Dragons at the Docks’ boat racing event at Dublin’s Grand Canal Docks last week. More than €200,000 was raised for the Dublin Simon Community and other local charities. I was sorry to miss the after party but I look forward to the next event already!
Here’s a quick round-up of the industry news you might have missed this week:
The Sunday Times
Valerie Flynn writes on page 4 about ‘New homes to float your boat’. This refers to plans by Dun Laoghaire Harbour Company (DLHC) to provide approximately 50 floating homes at the western end of the port. DLHC are seeking construction partners to supply the two-bedroom homes, which are expected to be 84 sq m – larger than most two-bedroom apartments in the area. Of course, sensational sea views will come as standard! The harbour estate is 250 acres, made up of 50 of land and the rest water. While originally the DLHC considered traditional development on the land, the turned their attention to floating properties over the past year. Chief executive Gerry Dunne predicts that “with a fair wind in our sails we could have them in the space of a year”. Costs are likely to range from €250,000 to €300,000, although it will be interesting to hear what lenders make of such floating security for a mortgage…
Writing on commercial property, Grainne Rothery looks at the retail sector and how refitted shopping malls allow established brands to expand and bring new entrants to the Irish market. She explains that while retail sales volumes have increased over the last year and consumer sentiment is strong, “the retail property sector has been somewhat slower than expected since the beginning of 2017, with uncertainties around Brexit and lack of available stock being contributing factors”.
Other industry news
- Mark Tighe writes ‘Ex-public planner sets sights on 40 storeys high’: Former head of planning and development at Dublin City Council, Jim Keogan is now lobbying Cork City Council for a 40-storey building on Cork’s Custom House Quay on behalf of New York-based, Kerry brothers Donal and Kevin O’Sullivan.
- Dublin house builder, Bridgedale, has apparently taken options to purchase €100 million worth of development land in Wicklow and Citywest – contingent on the company floating on the Dublin stock exchange.
- Paddy McKillen is paying more than €30 million for a 9.7 acre site off Temple Road in Blackrock, South Dublin in order to build up to 300 homes with his son, Paddy McKillen Jnr.
- Designer Group, M&E specialist contractor, has expanded into the US market with the purchase of a Missouri company that specialises in designing power plants.
- Icare Housing gets ready to launch next month. The housing non-profit will buy homes of distressed borrowers and allow the families to remain in the properties as local authority tenants.
- Gavin Daly writes that ‘Nama plans prime site in north docks’, referring to plans lodged for a large-scale commercial development (four office blocks, two apartment buildings and pedestrian plaza) on the site between the Dublin Landings development and the 3Arena.
- German property company, Real IS, has paid €46.5m for the Capitol building in Cork.
- Developer McDonogh Capital Investments expects to lodge a planning application within the next year for an €80m innovation centre on the outskirts of Galway City.
- CBRE is guiding €4.5m for a four-storey, Georgian building at 119 St. Stephen’s Green (better known for housing Dublin’s best steak, at Shanahan’s on the Green!).
- Savills is asking €1.8m for a 19-hectare site with residential development potential at Rowlestown, Co. Dublin (8km north of Swords).
- ‘Builders’ merchant shows his steel: Home Project Centre chief has cemented an unlikely turnaround after exiting Nama’, writes Philip Connolly about Sean Moran. The HPC chief talked about their 13 DIY and building supplies outlets nationally, turnover up 20% and growing and the company making a healthy profit since exiting the Nama process ‘We want to hit €100m revenue by 2020″.
IPAV Residential Property Price Barometer
On the front page today, readers will be met with the ominous headline ‘Property prices will hit boom levels within a year’. This applies to prices in the Dublin market and it comes from IPAV head Pat Davitt as the organisation releases the Residential Property Price Barometer (available exclusively in the Sunday Independent today). According to this most recent research, the cost of an average family home in Dublin is now €527,894 – more than double that of the national average three-bed at €253,466. Unsurprisingly, Dublin 4 tops the price charts for houses while Dublin 2 is the priciest area for apartments, with Dublin 3, Dublin 14 and Dublin 7 following closely behind. Wicklow remains the most expensive area outside of Dublin, followed by Kildare and Meath. Counties Longford, Sligo and Leitrim recorded the lowest house prices nationally. Lack of available stock and delays with new stock coming to the market is still the driving force.
There is a two-page breakdown of regional pricing and values across pages 6/7 of the property supplement today, with some excellent commentary from Conall McCoille, Dr. John McCarthy, Ronan O’Hara, Tom Parlon and Ruchika Hassan. There’s too much to summarise is well so if you only have time for one newspaper today, the Sunday Independent is the one to pick up.
Other industry news
- There is a two-page spread across pages 16/17 on the housing crisis. Philip Ryan writes about ‘How Airbnb is breaking up communities’, with development residents saying they feel like ‘victims’ in their own homes. It might well be considered insensitive timing of the newspaper to include the inconvenience of residents by tourists under the heading of housing crisis…
- The quick ‘flip’ is back, speculators are snapping up properties and re-selling them to new owners within a short space of time, making sizeable profits. This is an inevitable consequence of any marketplace with consistent demand but ever-reducing levels of supply.
- Niamh Horan writes that ‘Dublin’s rental market is totally crazy and bad for mental health’, that’s not necessarily a technical description nor an actual diagnosis but it is difficult to argue with her conclusion.
- The Merrion Hotel has sold all 12 of its luxury apartments, which have access to the hotel facilities (including in-house dry cleaning and laundry services!) and The Garden Room restaurant.
Sunday Business Post
On the front page today, Hugh O’Connell writes in advance of Budget 2018 ‘Fianna Fàil demands tax cuts for developers to solve housing crisis’. This sounds quite controversial but the reality is that incentivising the people who can actually supply new homes is the only reasonable measure left to do. The State – irrespective of budgets to local authorities – simply does not have the capacity and skills to get building this week, this month or this year. Rather than wasting further time and resources ramping up, we need to use the skills available today i.e. experienced home builders. The uncomfortable truth is that the help-to-buy scheme is, in effect, a developer incentive, it just doesn’t go far enough.
Other industry news
- Harcourt Developments (Pat Doherty) sell £12.5 million boutique hotel in Manchester.
- Deutsche Bank has rejected an offer by Cardinal Finance to refinance debts by Galway developer Gerry Barrett.
- Dublin office rents are the third highest in the eurozone at €646 per sq. metre, with Paris still the most expensive city, followed by Stockholm.
- Leinster Property Auction seeks entries for public sales events in late September and early December.
- CBRE’s Dan Shannon writes that ‘Flexibility leads to growth for co-working office sector’; this is the continuation of a trend that the market has experienced over the past three years, in Dublin and now other cities and regional towns.