The chairman of the O’Flynn Construction Group, Cork-based Michael O’Flynn, has also agreed a separate joint venture arrangement to drive expansion of his group’s business in the UK.
Mr O’Flynn yesterday described the announcements as “a pivotal moment” in the development of the O’Flynn Construction Group following some “challenging years” in the wake of the global financial crisis.
The funding platform, which will underpin the group’s growth in Ireland, has been established under the auspices of a new joint venture with Avenue Capital Group — a global alternative investment firm with some $13.2bn (€12bn) in assets under management as of September 30.
The new structure also includes senior debt funding from AIB and a substantial portfolio of development assets.
O’Flynn Construction Group’s joint venture arrangement in the UK has been agreed upon with global investment giant Blackrock.
“Our new funding platforms position the group for significant growth both in Ireland and the UK,” said Mr O’Flynn.
“While we have a clear business agenda I also believe our ability to move ahead with these developments will contribute significantly to a key infrastructure deficit in Ireland today — the chronic lack of new homes.
“I am delighted that we are partnering with the Avenue Capital Group which brings both capital and a depth of experience to our ambitious objectives.”
Richard Furst, the head of Avenue Europe Strategy and chief investment officer of Avenue Capital Group, said that the groups he represent was delighted to embark on the joint venture with O’Flynn Construction.
“In view of Ireland’s acute shortage of new homes and the lack of experienced home building platforms with strong balance sheets, we look forward to providing support through our joint venture with O’Flynn Construction to target the significant opportunities in the market, including making land acquisitions as banks and other non-strategic holders continue to dispose of their development loans and assets,” said Mr Furst.
Mr O’Flynn said that one of the key objectives of the O’Flynn Construction Group is to build more than 10,000 new homes over the course of the next eight years, mainly in the Dublin and Cork areas.
The developer said that people were ready to buy homes again but that planning process and infrastructural issues needed to be addressed so people could access affordable homes.
“There is a housing crisis in this country,” Mr O’Flynn told RTÉ.
“We have to face up to that and have measures that actually deal with that. We have to ensure we have fast-tracked planning solutions because we have not been forward planning for the last number of years.
“We have to now accept we are in a minus position. The industry and the Government, everybody, has to join up so that people can buy homes.”
In the UK market, a number of development assets have also been acquired in Edinburgh, Clerkenwell, Peckham, Portsmouth, and York.