Just who is buying up Dublin?
Foreign buyers scramble to snap up prime assets in the capital
Individual investors have also brought a splash of colour. John Malone, America’s biggest private landowner and the chairman of UPC-owner Liberty Global, recently bought the Trinity Capital hotel on Pearse Street, while Israeli billionaire Igal Ahouvi has snapped up assorted small retail outlets. Neville Isdell, the former chief executive of Coca Cola, evidently thought Dublin was the real thing by paying €10 million for the CHQ building, while Russian investor Elena Baturina paid €22 million for the hip Morrison hotel.
“The Irish have come to terms with the economic crisis; you understood exactly the essence of it and you have turned a corner and that’s why it is an attractive market,” Baturina told The Irish Times.
“The market for hotels in Ireland is very good. Nama has been very influential. My team is continuing to look closely at the market, cooperating with Nama and with others, and there are a few specific prospects under consideration.”
Tax efficient real estate investment trusts (REITs), such as the recently lunched Green Property REIT, may add more spice to the market in coming months. Mark Daly is head of property investment at Investec, which also advised CapREIT on its purchase last week.
Daly says that while things are heating up again in Dublin commercial property, the old days of capital speculation are a distant memory. Income, he says, is now the name of the game. “The smart money from overseas likes to be paid while it is waiting for a recovery,” he said. “Now, it’s all about the income. Capital growth is only the potential upside.”
Investors, he said, can get an average yield in Dublin that may be 2 percentage points more than prime cities such as London or Paris. “Dublin prices should always be at a discount to those places, true. But if you can get 7 per cent in Dublin, why wouldn’t you take that over the 5 per cent or less you’ll get in London?”
Investors, meanwhile, will be hoping that after the feeding frenzy, they won’t have to go hungry once again.