Just three years after it pulled back from an initial public offering on account of “prevailing market conditions”, Core Industrial may well have gotten the timing right on the sale of its assets in Dublin and the greater Dublin area.
Having offered the Core portfolio to the market in April, CBRE and Eastdil are understood to have selected four international investors to advance to the next round of the sales process.
It is understood that the remaining parties – M7 Real Estate, Palm Capital, Arrow Capital Partners, and Ares Management – have submitted offers of up to €150 million.
While those numbers are below the €170 million figure the joint selling agents had been guiding when they offered the portfolio for sale, should a sale be completed at the lower level, it would still represent a significant uplift on the valuation Core had ascribed to its assets in 2018.
In an announcement published in advance of its then-proposed IPO, the company said its 106 industrial assets and 167 acres of land (of which 36.7 acres were zoned for development) in the greater Dublin area had a value of €82.9 million in total as at November 30th, 2017. It is understood the portfolio now being offered for sale differs in terms of its composition.
In its most recent set of accounts filed with the Companies Registration Office, Core Industrial Properties reported that its asset base had risen by 10 per cent to more than €100 million in 2019, ahead of a major refinancing and its decision to put the Core portfolio up for sale. The increase was driven largely by an 8 per cent uplift in the value of its investment properties.
Commenting on the impact of the Covid-19 pandemic on its business, the company, which is led by Daniel Donovan and William Redmond, said in its accounts that its industrial portfolio had “held its value”.
Largest single asset
While the Core portfolio includes properties in Rathcoole, Clondalkin and Finglas, its largest single asset is Naas Enterprise Park in Kildare. The 125-acre scheme known formerly as Tougher Business Park was acquired in 2015 by Core's former backers, York Capital, for €17 million. The New York headquartered hedge fund exited from Core Industrial in 2019, with US investment fund Pramerica Real Estate Capital providing the funds for a repayment of loans from the hedge fund.
Core Industrial's latest financial report said the company dropped its Reit status in May 2020 and refinanced again in July 2020, with the London-based Mount Street Group, a property debt specialist founded by former investment bankers Ravi Joseph and Paul Lloyd, taking a charge over its assets. Under Irish law, a Reit must float on the stock market within three years of being incorporated.