Irish spend €3 billion on overseas property in second quarter of 2007

IRISH investors spent €3 billion buying foreign properties in the three months to June of this year bringing the total spend this year to €5bn.

According to the latest report from commercial property advisors Jones Lang LaSalle, Irish investors’ appetite for purchasing properties overseas is showing no sign of diminishing — a market trend that has remained consistent for the past seven years.

The largest purchase by an Irish investor in quarter two of 2007 was made by Bank of Ireland Private Banking which paid €309 million on behalf of its clients for a 50% stake in the New Mersey Retail Park in Liverpool.

Britain and Europe remain the most popular overseas locations for Irish investors.

In quarter two of 2007 €2.1bn of Irish money was invested in the British property market (71.5% of the total overseas investment) and a further €426m was invested in the German market (14.5%).

The US also saw a higher level of Irish investment this quarter with three deals totalling €153m (5.2%). The remainder of overseas investment took place in France (3.4%), Belgium (3.2%) and the Netherlands (2.1%).

The offices and retail sectors in Europe accounted for the highest levels of investment in quarter two of 2007. Investment in the retail sector totalled over €846m. Investment in the offices sector totalled over €723m, with 12 deals completed in quarter two, 24.6% of the €2.9bn total.

Head of research with Jones Lang LaSalle in Ireland, Clare Eriksson, said that she expected the high levels of international investment activity by all investors, ultra high-net worth individuals, institutions and syndicates alike, to continue for the foreseeable future.

“To give just a few examples of the level of new investment initiatives active currently: CMC Capital plans to raise €20m from Irish investors for a new €100m German commercial property syndicate; Augusta, the Dublin-based commercial property fund operator is seeking €20m for another German property fund, while Ailesbury Investments is seeking €30m for a property portfolio in Florida.

And yesterday the Association of Chartered Certified Accountants (ACCA) advised holiday makers to think carefully about investing in an overseas property when on holiday this year.

Head of ACCA Ireland Roger Acton said: “An investment in property is always a major decision; individuals need to consider whether they are buying a holiday home or an investment property. In many cases the property can not be both and could even end up being neither,” Mr Acton said.

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