Some of the most interesting Q1 2013 deals took place on the edges of Europe even though the Big Three dominated in terms of volumes Ireland and its struggling economy received a much-needed boost in the second week of April when EU finance ministers, meeting in Dublin, granted the Emerald Isle and Portugal another seven years to repay bail-out loans.

Some of the most interesting Q1 2013 deals took place on the edges of Europe even though the Big Three dominated in terms of volumes

Ireland and its struggling economy received a much-needed boost in the second week of April when EU finance ministers, meeting in Dublin, granted the Emerald Isle and Portugal another seven years to repay bail-out loans.

Irish finance minister Michael Noonan described the move as ‘a very positive development’ which marked ‘another significant step on Ireland’s and Portugal’s journey to a full and sustainable return to the markets.’ In a sense international real estate investors are ahead of the curve; a number of top names have been increasing their activity in the Irish market - which means Dublin to a large extent - for at least the past six months. This activity stands apart from the Irish Bank Resolution Corporation and NAMA agency offloading big-ticket assets in London which were backed by reckless loans from Irish banks in the boom years.

RISING VOLUMES
The domestic Irish market - albeit much smaller than London with smaller lot sizes - is also beginning to show signs of life after being left badly unconscious by the financial crisis. Receivers have been busy finding willing buyers with a flair for adding value and/or buying at a discount to take a wide range of properties and development schemes out of administration. CBRE recorded an investment volume of €336 mln in Ireland during the first quarter.

This quarterly volume - based on deals of €1 mln-plus, compares favourably with the €545 mln invested in Irish commercial real estate in full-year 2012. In total, 21 investment transactions of more than €1 mln were completed in the Irish market during Q1 2013. The Q1 performance was also significantly higher than the sum invested in each of the previous three years.

Notable deals completed in the first quarter of 2013 include the sale of the Bishop’s Square office building in Dublin to US investor King Street for €65 mln, reflecting an initial yield of 9.8%; the sale of a portfolio of four office buildings in the Irish Airlines Pension Fund and the sale to German fund GLL of two adjoining buildings on Grafton Street for a reported €40 mln.

In November US private equity giant Blackstone bought the Burlington - a top Dublin hotel - for €67.5 mln in the largest of a string of 24 hotel deals in Ireland over 2012 that generated a total volume of €146 mln, according to CBRE. In a major turnaround of market conditions there is now more demand for prime property in the Irish market than there are willing or ‘motivated’ sellers. Caroline McCarthy, executive director and head of...

Click on the link below for the PDF of the full story (Premium Content)