Boundary expands into EUR 750m Dublin regeneration scheme

Irish investment company Boundary Capital is acquiring 45% of Ireland's largest department store, Arnotts, for EUR 65 mln. Brunner, a vehicle controlled by Boundary, will invest EUR 45 mln for an 28% indirect stake in Arnotts, while Anglo Irish Private Bank will co-invest EUR 25 mln with Boundary.

Arnotts' principal activities are retail trading and retail property development. It operates three retail premises, including a major department store on Henry Street in Dublin city centre, which is the largest in the country and the fifth largest in the British Isles. The jewel in the crown is an adjacent property portfolio for which Arnotts has received an initial grant of planning for a redevelopment to create the Northern Quarter. The cornerstone will be a new 24,000 m² Arnotts store. In all, the new shopping and entertainment area will have 47 new shops, 17 new cafes, restaurants and bars, 189 apartments and a 152-bed four-star hotel.

The North Quarter development proposal amounts to 153,000 m² and represents an investment in excess of EUR 750 mln in the heart of Dublin, Boundary said in a statement. Property advisor CBRE has valued the property assets included in the re-development proposal at EUR 410 mln without planning, and EUR 450 mln with planning. Boundary chairman Niall McFadden commented: This is a unique opportunity to be involved with an iconic retail brand and be part of one of the largest retail-led mixed-use regeneration projects in Europe that will transform shopping in Dublin's City Centre.'

Arnotts is finalising the terms of appointment for both a development manager and a minority equity investment by a third party. Boundary is listed on AIM in London and on the Irish stock Exchange in Dublin. McFadden is a director of Arnotts and the beneficial holder of shares in a joint venture property undertaking that is 50.1% owned by Arnotts.

PropertyEU reported earlier this week that Irish developer David Daly has bought the 'River Island' retail premises on Grafton Street in the centre of Dublin from Arnotts and Arnotts Staff Pension Fund for EUR 115 mln. The price reflected an equivalent yield of 2.3%.