Cairn spends €64m on sites

Irish housebuilder Cairn Homes is looking to take advantage of the chronic lack of new houses in Dublin by building about 360 residential units on three sites purchased for €63.7m.

The sites acquired by Cairn include two located in Carrickmines and an 8.11 acre plot in Rathgar.

Combined, the two Carrickmines sites span just over nine acres and have been bought for €20.7m while the third development site changed hands for €43m.

Commenting on the acquisitions, Cairn Homes co-founder and chief executive Michael Stanley signalled further deals are likely in the near future following the company’s successful initial public offering.

“We are delighted to announce the acquisition of these unique sites on the south side of Dublin, the first since our recent initial public offering.

"We look forward to adding to our pipeline over the coming months, as part of our strategy to deliver high quality homes, in major urban centres, with a particular focus on the greater Dublin area, where we believe the greatest demand exists,” Mr Stanley said.

The Carrickmines sites are on Brennanstown Road while the Rathgar site at Marianella, Orwell Road, is subject to approval by the Vatican and the Irish Charities Commission.

Acquiring the Carrickmines sites at the same time will allow the company to lodge a revised planning application for 160 residential units, which will include 60 to 70 houses.

The Marianella site has planning permission for 211 residential units comprising 12 five-bedroom houses, six four-bedroom duplexes and 193 one-, two- and three- bedroom apartments.

Construction on the developments is expected to begin in the opening months of next year. Earlier this month Cairn raised a gross €440m through its flotation on the London Stock Exchange.

Taking administrative costs into consideration, Cairn’s acquisitions’ warchest totalled close to €385m.

Although yesterday’s announcement represented the company’s first acquisitions since the flotation, the initial public offering also triggered the purchase of other sites in Dublin, Meath and Galway for about €62m.

Buying Cairn shares is a play on the clear need for new housing, particularly in Dublin, where new build levels have yet to recover to any extent and are substantially below demand, Davy Stockbrokers analyst Colin Sheridan said yesterday.