Ormond Quay hotel portfolio down 85%

THE SALE of distressed hotel assets assembled by developer Bernard McNamara during the chaotic property boom continues this week with the planned disposal of the former Ormond Hotel and two adjoining four-storey period houses at Upper Ormond Quay in Dublin city centre.

Joint selling agents CBRE Hotels and Corrigan Brown Chartered Surveyors are seeking offers over €2.5 million for the three properties which were acquired around 2006 for over €17 million.

Paul McCann of Grant Thornton is receiver to the Ormond and a string of other hotels acquired by McNamara with Bank of Scotland (Ireland) funding.

Other sales under way include the Burlington Hotel in Dublin; Parknasilla Resort Spa in Co Kerry; and the Cork International Airport Hotel.

McNamara also had a stake in the Shelbourne, Conrad, Tara Towers, Montrose and Mercer hotels in Dublin as well as the Radisson in Galway and the Kilkenny Ormond.

Although the Ormond Hotel has a prime city centre location fronting on to the River Liffey, it is thought unlikely that whoever buys it will go to the considerable expense of redeveloping and fitting it out as a hotel because of the limited car-parking in the area but more particularly because of the intense competition in the city hotel industry.

The fashionable Clarence Hotel, on the opposite side of the city quays at Wellington Quay, secured approval from An Bord Pleanála four years ago for a major redevelopment but even with wealthy owners, including U2’s Bono and the Edge, there is no sign of that project proceeding.

The same planning authority also cleared the way for a new six-storey, 130-bedroom hotel on the Ormond site but the permission lapsed in 2009.

The likelihood is that the Ormond site will be used for a mixed-use development of offices and shops or possibly with a residential element given its high profile between the Four Courts and O’Connell Street.

The old hotel has frontage of 31 metres (101ft) on to Upper Ormond Quay as well as along Little Strand Street to the rear. The building has a floor area of 2,835sq m (30,515sq ft) and is presently in “shell” condition. McNamara bought the rundown hotel in 2006 for €12.5 million.

The adjoining building at 12 Upper Ormond Quay – bought around the same time for €2.4 million – has retail use at ground floor, upper floor offices and a warehouse/stores to the rear. There is a useful rear access onto Hamilton Court.

The first, second and third floors are occupied by Ellis & Ellis Law Researchers at a rent of €30,000 per annum. The joint agents suggest that if the ground floor and rear storage areas were occupied the overall rent would be at least €50,000.

Next door, number 13 is also in “shell” condition and ready for redevelopment or refurbishment. The house, which cost €2.2 million, also has access on to Hamilton Court.

The “realistic” asking price for the three properties is expected to appeal to a number of developers.

A buyer will get the three properties for roughly what McNamara spent buying Number 12 alone.