Cantillon: US firm’s IPO will share its Irish risk
Kennedy Wilson indicated it would be following its money in the apartment market
Peter Collins, who runs Kennedy Wilson Europe’s Dublin office, predicts that 2014 will be the year that retail bounces back
The news that Kennedy Wilson is eyeing a £750 million (€914 million) initial public offering in London puts a bit of much needed context around the US group’s Irish buying spree.
One of the first investors to see value in Irish commercial real estate, the Californian firm was thought to be all done with Ireland last summer before embarking on a fresh round of deals culminating in yesterday’s joint venture with Green REIT to buy Central Park.
And there is more to come with Peter Collins (right), who runs Kennedy Wilson Europe’s Dublin office, predicting that 2014 would be the year that retail bounces back. To a certain extent it has put its money where its mouth is already with the acquisition of Stillorgan shopping centre via the €306 million purchase from Nama of the Opera portfolio of Treasury Holdings’ property loans.
Collins also indicated that Kennedy Wilson would be following its money in the apartment market, with plans to increase their holdings of Dublin apartments from about 800 into the thousands. That was on Tuesday and as of yesterday it has crossed the threshold of its first thousand.
The company seems to have a very large appetite for Irish property and Irish risk. But perhaps it is not as big as it might seem, with the proposed £750 million listed vehicle offering a way of sharing some of this risk with other investors. An intention to list is to be made within the next two weeks with an actual listing expected in the following fortnight, according to Property Week. The as yet unnamed vehicle will have a debt to equity ratio of 50 per cent giving it a £1.5 billion war chest.
Ireland, along with the UK and Spain, are its target markets but it seems the company will not be “seeded” with any existing assets by Kennedy Wilson. That said, there is presumably nothing to prevent it buying some of Kennedy Wilson’s existing Irish assets if the price is right.