Irish funds swoop on two Cork retail investments

Irish funds swoop on two Cork retail investments

Irish investment funds IPUT and Davy have made two separate swoops on suburban Cork retail assets.

Davy has paid close to €20 million for the Ballincollig Shopping Centre, with an income of €1.99 million and 7.96% return, while IPUT paid a reported €56 million for the Mahon Point Retail Park, anchored by B&Q, for a 7% yield.

The two centres, at opposite sides of the city in well-populated suburbs of Metropolitan Cork, had been developed in the 2000s by two of Cork's strongest developers, O'Flynn Group in Ballincollig, and O'Callaghan Properties in Mahon, but each had since changed ownership/control.

Vendors of Ballincollig's main shopping centre, part of a highly successful mixed-use redevelopment of the former Murphy Barracks site and renamed CastleWest, were US venture fund Blackstone.

Blackstone acquired the Ballincollig retail asset in 2014, along with O'Flynn-developed landmark Elysian development in the city centre which they have since resold to Kennedy Wilson for over €87 million.

Spanning 140,000 sq ft of retail, with over 800 car parking space and adjoining a separately-owned Tesco, it has 43 units and is anchored by Dunnes (who occupy two units on a long leasehold) CastleWest was offered quietly in recent months by the Cork offices of joint agents Margaret Kelleher of Lisney and Isobel O'Regan of Savills.

It had guided at  €22m, getting local and national interest rather than international purchase, but is understood to have sold to Davy via best bids process for less than €20 million.

It is 81% occupied, with top tenants including Heatons (paying €240,000 pa), New Look, Hickeys, Easons, Euro Giant and Starbucks.

Irish funds swoop on two Cork retail investments

It has a current WAULT of approximately 6.71 years to break and approximately 9.61 years to expiry on its leases.

The Davy-managed fund will have a net yield of just under 8%.

Meanwhile, east of the city, another Irish fund, IPUT, has successfully secured the Mahon Point Retail Park for an unconfirmed €56 million from Deutsche Bank.

They acquired it in 2018 after purchasing some €300m in fully performing loans attached to Mahon Point's overall 's developers O'Callaghan Properties who developed it on part of a 11-acre landbank acquired from City Hall for c Ir£40m (see other OCP Cork Docklands 30 acres site swoop, worth c €47.5m, p17.)

Mahon Point's Retail Park is fully developed and fully occupied, spanning nearly 160,000 sq ft, with 600 car parking spaces on a site just west of the main Mahon Point Shopping Centre, and south of the Jack Lynch tunnel.

Tenants in the ten-unit retail park include B&Q, Argos, Currys PC World, Halfords, Hickeys, Carpetright, EZ Living, Mothercare, and Home Store+More.

Davy has previously acquired/redeveloped retail assets in Cork city centre, on St Patrick's Street, and it's understood that retail makes up 20% of its €2.55bn Irish portfolio.

It's due to get a 7% return on its off-market Mahon Point Retail Park purchase.

Details (CastleWest): Lisney 021-4275079, Savills 021-4271371

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