Chartered Land seeks buyer for €650m Dublin apartment portfolio

Developer Joe O’Reilly’s Chartered Land is seeking offers of about €650 million for a portfolio of 1,695 new apartments it plans to deliver across four landmark Dublin sites.

Agent CBRE is understood to be targeting a number of institutional investors in a forward sale process for Project Chase, a portfolio of four residential development sites located at Parkgate Street in Dublin city centre, and the surrounding suburbs of Rathborne, Finglas and Kellystown.

According to the confidential teaser document circulated to prospective purchasers the proposed units will be constructed in phases by Chartered Land's sister company, Castlethorn, between 2021 and the final quarter of 2022. On completion the purchaser will take ownership of the entire portfolio.

Some 1,237of the apartments within the portfolio will be located on the Parkgate Street and Rathborne sites while the remaining 458 units are to be built on the Finglas and Kellystown sites.

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The portfolio’s €650 million guide price equates to an average price of €383,480 per apartment – or €636 per net sq ft.

The 1,695 apartments within the portfolio will have an average floor area of 56sq m (602.78sq ft) and include a mix of private, affordable (Part V) and co-living residential units, and be will offered at a range of rental levels from €1,825 to €2,725 per month depending on their location and size.

Upon completion, the Project Chase portfolio is expected to have an estimated rental value of about €37 million per annum and to deliver €29 million in net operating income.

Some 36 per cent, or €10.44 million of the portfolio’s €29 million net income, is expected to come from the 542 units which Chartered Land is aiming to deliver on the landmark Hickeys site at Parkgate Street.

The developer acquired the 1.65 acre (0.67 hectare) plot for €30 million in August 2018. While the price paid by O'Reilly represented a premium of 50 per cent on the €20 million agent Finnegan Menton had been guiding when they offered it for sale in an off-market placing, the Parkgate Street site's proximity to Dublin city centre makes it particularly attractive to investors in the private rented sector (PRS) market.

The area surrounding the Hickeys site has seen a number of major developments in recent years including Heuston South Quarter (Eir Headquarters), the new Criminal Courts of Justice, and Kennedy Wilson's Clancy Quay PRS residential offering at Islandbridge. Diageo (Guinness) is to develop a major mixed-use scheme known as St James's Quarter on a 12.6 acre portion of its St James's Gate premises.

Meanwhile, Chartered Land's Rathborne site near the Royal Canal at Ashtown in Dublin 15 is expected to accommodate 695 apartments and account for 39 per cent (or €11.31 million) of the portfolio's net operating income.

O'Reilly acquired the 12.29 acre (4.97 hectare) site last February for about €22 million, some 13 years after his own Castlethorn company sold it to Capel Developments for more than €70 million. Spellet Developments, a company linked to Castlethorn, is understood to have completed the purchase with funding from the Cardinal Capital Group.

Chartered Land’s site at Finglas is expected to accommodate 220 units and account for 12 per cent or €3.48 million of the portfolio’s net operating income, while the 237 units it intends to deliver on its Kellystown site is expected to deliver a 13 per cent share, or €3.77 million annually.