European investor to seek €1bn from sale of Irish residential rental portfolio

Having spent the past several years amassing a portfolio of nearly 1,700 rental properties across Dublin, Cork and Galway, European property firm, the LRC group looks set to cash in on its investment in Ireland’s private rented sector (PRS) market.

With the appetite among institutional investors for certain opportunities proving robust notwithstanding the uncertainty caused by Covid-19, LRC has instructed Eastdil Secured to handle the disposal of its entire Irish residential rental portfolio. While the process is still at an early stage, it is understood LRC is hoping to secure over € 1 billion from the sale. LRC declined to comment on the matter when contacted by The Irish Times.

While the company's move comes at the same time as developer Pat Crean's Marlet Property Group seeks offers in excess of €1 billion for 2,000 apartments it is developing across Dublin, the portfolios differ in terms of what they offer to their prospective purchasers.

While the apartments in Marlet’s Castle portfolio are all new-builds, the LRC Group’s portfolio consists entirely of standing stock, the vast majority of which is let and producing rental income.

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LRC’s most recent investment in the Irish PRS market took place in February of last year. On that occasion, the company paid developer Gerry Gannon’s Gannon Properties €9 million, or an average of €187,500 per unit, for 47 apartments and one retail unit at Applewood in Swords, Co Dublin.

The company’s most significant transaction here took place in April 2019 however, and saw LRC pay about €150 million to acquire 600 mainly-residential assets across Dublin, Cork and Galway from Oaktree affiliate, Targeted Investment Opportunities (TIO).

Smithfield Lofts

Prior to that, LRC’s last reported deal in the Irish residential market was in February 2018 when the company fended off six other bidders to acquire a mixed-use investment at Smithfield Lofts on North King Street in Dublin for just over €10 million. Smithfield Lofts is a five-storey-over-basement building containing 57 apartments, six two-storey townhouses and commercial units. LRC acquired 44 of the apartments, six townhouses and 33 car-parking spaces. The other 13 apartments and commercial units remained in private ownership.

Outside of its stake in Ireland’s private rented sector market, LRC retains a significant interest in the country’s hospitality sector.

In 2018, the company acquired the Irish-led hotel investment and management company, Amaris Hospitality, from US private equity firm, Lone Star in a deal valued at £600 million (€678.5 million).

Established in 1995 by Israeli investor Yehuda Barashi, the wider LRC Group has grown its presence across Europe to the point where it now has more than €6 billion of residential and commercial assets under management.