Apartment blocks sold

A DEAL worth around €16m has been reached on the first bank/receiver sale of an entire apartment and retail scheme in Cork, at suburban Dennehy’s Cross.

Apartment blocks sold

Irish investors, the Comer brothers from Galway and who are primarily UK based, came to the fore in a highly significant deal negotiated by Savills. It is part of a larger, €75m 640-apartment sell-off for Ulster Bank, in Dublin and Cork

The 142-unit Orchard Gardens scheme, with retail units and a Tesco Express developed by Frinailla, is being bought as part of what’s seen as a key test for residential investments, notably finding Irish buyers.

Buyers of the Gemini portfolio (offered last September by Savills for joint receivers Grant Thornton and KPMG,) can expect a c 6% yield, with rents rising to €8.5m when all assets purchased are completed and let. Residential rents at the Cork scheme Orchard Gardens could reach €1.6m at 97% occupancy.

The Gemini portfolio buyers, the racehorse-owning Comer brothers from Shannagh in Co Galway, have a strong development and investment track record in the UK and Germany, and are known for apartment developments in Britain, many in converted institutional buildings. They have just added 500 units in Dublin, and 142, in Cork to their tally.

The portfolio — bought at a 70% discount from peak values — includes Orchard Gardens, Dennehy’s Cross, Cork, on the site of the old Dennehys garage and bar near UCC, done by Frinailla; Tallaght Cross East, developed by a Liam Carroll Company; and Island Key by the IFSC and East Wall in Dublin, done by Ellen Construction. The entire €75m acquisition mix embraces almost 200,000 sq ft of commercial space, including the vacant Tallaght Glashaus Hotel, while retail tenants include Tesco and Marks & Spencer.

The Comer brothers visited Cork in recent months looking over other available buys, but there’s no other comparable blocks equivalent to Orchard Gardens currently on the market in the southern city.

With private homes in Ireland, the UK and Monaco, the Comers are now reckoned to have bought close to 1,000 residential investments in the past year in Ireland, as well as John Fleming’s skeletal Sentinel building in Dublin’s Sandyford for under €1m.

In Cork, UCC had rented the first block of Orchard Gardens in a lease due to expire this year, and a further 82 units were finished off in recent months, and are renting at almost €1,000 a month for two-beds.

The development is close to UCC and the Bon Secours hospital, and includes a 14,000 sq ft Tesco Express, at a rent of €133,000 pa, and a half-dozen other retail units, which are being marketed by Savills. Cork Savill’s director Isobel O’Regan declined to confirm reports this week of the Comers’ deal in Cork and Dublin.

Other Frinailla schemes in Cork include the fire-ravaged Good Shepherd Convent and a site on Grand Parade. There’s also the completed City Square scheme on Watercourse Road which is largely rented out, with retail vacancies, and the Douglas residential scheme Temple Grove/the Vicarage on Carr’s Hill, now controlled by West Register, a company associated with Ulster Bank

Details: Savills 021-4271371

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