FIFTY apartments in Cork’s Harty’s Quay, earning €760,000 a year in rent after 40% rental growth since they last sold, are included as part of one of the country’s largest sell-off of buy-to-let units.
It comprises more than 800 units in 16 locations, primarily apartments, but also including about a dozen houses.
The offer of 815 units has an unconfirmed guide price of €240m, via joint agents Savills Ireland and Eastdil.
Secured, for owners the US-based Marathon Asset Management who built up the portfolio over recent years, including buying 588 apartments from Nama in 2015 for €120m, in Nama’s Plum Portfolio disposal.
It added 220 more to that tally, including the 50 Cork apartments in Harty’s Quay, Rochestown. They were offered in 2015 with a guide price of €6.75m, via Cushman & Wakefield’s Eoin Ryan, and sold after competitive bidding for €7.66m.
The 50 Cork units are in the two largest Harty’s Quay blocks developed by McCarthy Developments, called Neptune and Schooner, and included one, two and three-bed units, including 10 penthouses, some of up to 1,500sq ft.
The Price Register shows all 50 units in Rochestown’s Neptune and Schooner blocks selling by summer 2015, at prices from €120,000 to €149,00 in the Neptune and €133,000 to €203,000 in the Schooner.
At that time, there was a rent roll of €520,000 pa, with €540,000 expected once two show units were let, and at the time DTZ (now Cushman & Wakefield) said rental income could easily grow to €570,000 given rent rises. And, in the event, the rent roll at the Harty’s Quay element of XVI Portfolio now stands at €760,000 from the 50 lets, up 40% to a new average of €15,200 pa, showing the astuteness of the investment swoop by Marathon Asset Management back in 2015.
That contrasts with a total XI portfolio income of €14.7m pa, or an overall average of €1,530 per unit from the 815, unsurprisingly given the vast majority are in Dublin; the sales agents say further rental growth could push the income return to as much as €17.7m. Two of the Dublin developments have income in excess of €2m pa, such as Carrington Park, Santry where 142 units produce €2.48m pa, and Stillorgan’s Beechwood Court, earing €2.08m from 101 units.
The XVI Portfolio is expected to be bought by institutional investors and with 815 units as an entire lot would mark it out as the single biggest Irish sale of buy-to-let properties.
Among possible buyers are Kennedy Wilson and LRC Group, both of which own big residential portfolios in Dublin and Cork, with Kennedy Wilson owing the Elysian, and LRC acquiring City Square in Blackpool and apartments in Ballincollig during 2018, while LRC Group also this year spent €150m on 600 residential units in Dublin, Cork and Galway.