Almost 5,000 rental properties in the pipeline for South Dublin
Up to 4,700 residential rental units are in the pipeline for Dun Laoghaire Rathdown County Council area. This could generate a 29pc increase in rental accommodation units in the area where there are already 16,332 tenancies registered with the Private Residential Tenancies Board (PRTB).
About 1,000 of these new units are earmarked for students and such units are likely to accommodate five or even more adults per unit. Consequently the 4,700 units could have the capacity to accommodate more than 14,500 people.
Such an upsurge in development would bring fresh competition to the residential investor market and might even curtail rent increases in an area where two beds are achieving an average of around €1,650 per month. However, there are a number of reasons why it may be somewhat premature to celebrate such an outcome.
The planning authorities, both Dun Laoghaire and An Bord Pleanala, appear to be slow to approve some projects even when the developers are availing of so-called fast-track planning processes. The latest example was the authorities’ refusal for Ires Reit’s plans to develop 456 apartments across three 14-storey residential blocks at Rockbrook in the Sandyford Business District.
This refusal followed situations where two of the largest applications for residential developments in the county, which between them would accommodate up to 5,500 people, had to re-submit their proposals more than eight weeks after they first requested to avail of the new fast-track Strategic Housing Development (SHD) planning process.
Both of those projects have signalled that they could take up to 10 years to develop, and that does not include the time it takes to get approval.
One of these is UCD’s SHD request for 512 student accommodation units accommodating 3,006 bed spaces in seven blocks at its Belfield campus; those are to be built within a 10-year time frame.
The second was Michael Cotter’s Viscount Securities’ plans to develop 934 new homes at Clay Farm in Leopardstown, Dublin 18, comprising 363 houses and 571 apartments. Their 10-year time frame suggests that a major portion if not all may be aimed at the sales rather than rental market.
Cairn Homes also plans to develop a mixed-use scheme comprising 598 student bed spaces as well as 103 other residential units, retail space and a community sports hall on the sites of the former Blakes restaurant and Esmonde Motors at Stillorgan Village.
A spokesperson for Cairn said that at this early stage in the project the firm had not yet decided whether it would sell on the student residences when they are built or whether it would retain them for rental income.
Neither had it made a decision on whether the other 103 residential units would be for sale, rent or build-to-rent (BTR).
However, unlike the Reits which retain developments for income, Cairn’s business model has been to sell on. But with increasing international investor demand for build to rent opportunities, the 103 Stillorgan units might well be sold to the build to rent market.
The Irish Times also recently reported that Swedish student accommodation provider Prime Living has bought a site at Carmanhall Road and Blackthorn Road in Sandyford Business district, with the intention of providing about 700 bed spaces in 140 units.
That’s just a short walk away from where receiver Pearse Farrell of Duff Phelps is seeking an SHD for 482 apartments at Carmanhall Road. It will be interesting to see if other residential rental providers in the area such as Ires Reit might make an offer to Farrell, should he secure planning permission.
The receiver’s site was part of a larger plot where Cork developer John Fleming had partly developed the Sentinel Building where the Comer Brothers are now seeking planning permission to develop 284 live/work apartment units.
The Galway-born brothers have also accumulated a large portfolio of rental apartment blocks so there would appear to be a strong chance that the Sentinel apartments would also be rented out.
Just last month global property investment company Hines submitted a planning application for a new town centre at Cherrywood which will include 1,269 build-to-rent apartments.
Closer to Dun Laoghaire borough, the Cosgrave Bothers are developing 319 apartments at Honeypark which they have pre-sold to German fund Patrizia in a Hooke and MacDonald-brokered deal believed to be worth €132m.
These will bring to three the number of Honeypark apartment blocks which Cosgraves have sold into the build-to-rent market. Their first was the 197 Neptune block which they sold to SW3 Capital and Tristan Capital Partners for €72.5m.
Ires Reit already own about 400 apartments in Sandyford after recently completing 68 new apartments at Beacon South Quarter.
US real estate giants Kennedy Wilson are also significant landlords in the county where they built 116 rental apartments at Block K Vantage at Central Park, Dublin 18 last year to add to the 276 units they had previously bought at Vantage.
Nama too has about 200 apartments which are rented out at The Grange in Stillorgan and it is expected to bring these to the market in the near future along with a site with development potential.
Meanwhile, a portfolio of 25 apartments developed by Gerry Gannon’s Gannon Homes at Rockfield and Riversdale near the Balally Luas station in Dundrum are for sale with a €7.7m guide price.
The units include 18 penthouses and seven two-bedroom apartments in a number of blocks.
With three show units vacant, they generate rents of €460,032 per annum, which could increase to about €535,600 when the three show units are re-let.
According to agent Iain Finnegan, the penthouses are currently rented at €1,825 to €2,100 per month, while rents for the two-bed apartments range from €1,050 to €1,500 per month.
Nearby, Hibernia Reit completed 213 units some time ago following its acquisition of Wyckham Point, Dundrum and opted to rent rather than sell them.
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