Oaktree, BlackRock and Orion battle it out for the Square Tallaght

Sale process for the Dublin shopping centre enters final phase with price tag set at €233m

The Square Tallaght, where a majority stake  is   for sale. Photograph: Brenda Fitzsimons.

The Square Tallaght, where a majority stake is for sale. Photograph: Brenda Fitzsimons.

 

BlackRock, the world’s largest asset manager, and a fund belonging to US private equity giant Oaktree are among three shortlisted bidders in the race to acquire a controlling stake in the Square Tallaght, according to sources.

London-based real-estate investment firm Orion Capital Managers is the final firm on the list of bidders selected to go into the last phase of the process for the acquisition of the shopping centre, which was put on the market in August with a €233 million price tag, the sources said.

The 27-year-old shopping centre, Ireland’s largest when it first opened, registered some 22 million visitors last year and is currently producing annual rental income of almost €14 million.

It is being sold by joint agents Cushman & Wakefield and Jones Lang LaSalle, under the instructions of the National Asset Management Agency (Nama).

Spokesmen for Nama and BlackRock, which has $5.7 trillion of assets under management, and a spokeswoman for Oaktree declined to comment. Representatives from Orion did not respond to a request for comment.

The Square Tallaght sale includes 118 of the 160 shop units as well as a cinema with 13 digital screens and more than 2,400 car spaces. The mall’s anchor tenants are Dunnes Stores, Tesco and Debenhams.

The 53,603sq m (577,500sq ft) centre was opened in 1990 and sits on a site of about 27 acres. Some of the Square’s units were sold to institutions, traders and tax investors when the premises opened for business.

Solicitor and developer Noel Smyth, who began accumulating a stake in the Square in the middle of the last decade, stepped down from the board of the company that controls the centre, Indego, more than four years’ ago.

Shopping centres

The past two years have seen an unprecedented level of deals activity involving Dublin shopping centres.

In September 2015, UK property firm Hammerson and German insurer Allianz bought loans associated with the Dundrum Town Centre and 50 per cent interests in the Ilac in the capital’s city centre and Pavilions Shopping Centre in Swords. The two firms succeeded in taking over the Dundrum mall last year in a consensual arrangement with developer Joe O’Reilly’s Chartered Land. The centre was valued at €1.5 billion in August.

Hammerson has since secured ownership of the 50 per cent Ilac stake and was given the go-ahead last month by competition authorities to take over the 50 per cent Pavilions interest.

Elsewhere, US investment firm Blackstone bought the Blanchardstown Centre from Green Property in June last year for €945 million, while Germany’s largest public pensions group, Bayerische Versorgungskammer (BVK) paid more than €630 million to buy the Liffey Valley Shopping Centre last December from US commercial property firm Hines, UK insurer Aviva and London-based real-estate company Grosvenor Group.

Oaktree, acting through a vehicle called Targeted Investment Opportunities (TIO), has been among the most active buyers of Irish real-estate assets in the wake of the property crash. It is also using TIO to pursue the Square.

Meanwhile, the Court of Appeal cleared the way earlier this month for the construction of a €30 million, 18,600sq m extension to the Square Tallaght, in the face of opposition from Dunnes Stores. The retailer had argued that the plan would inconvenience its shoppers who would have to travel further to get to its store.