German investor pays €50m for Northside Shopping Centre

The German family-office investor, AM Alpha, has paid about €50 million to acquire Dublin's Northside Shopping Centre.

The transaction is understood to have delivered a significant return for the vendor, Patron Capital, on the price it paid for the Coolock property as part of its purchase of the "Project Drive" portfolio from Nama in 2014.

While the loans associated with the portfolio of north Dublin developer Brian O’Farrell had an outstanding balance of €228 million, Patron secured ownership of Northside Shopping Centre, and numerous other assets including a retail centre in Poland, a potentially valuable development site in north Dublin and a large house in the K Club for just €49 million – a discount of 78.5 per cent.

But while Patron would appear to have recovered its full outlay on Project Drive from the sale of Northside Shopping Centre alone, the price paid for the scheme falls well below the sum that had been anticipated when it was brought to the market by joint agents HWBC and Savills last year. Patron had been expecting to secure a figure in the high €50 millions, notwithstanding the general fall off in the value of shopping centres.

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Extending to 16,757sq m (180,375sq ft), Northside Shopping Centre comprises 76 retail units, some 90 per cent of which are occupied. The scheme is delivering total gross rent of about €4 million with SuperValu accounting for the highest individual share of this at €400,000 per annum. The centre’s anchor tenant, Dunnes Stores, rents its premises (unlike most of its stores around the country, which are usually owned by the company).

Other major retailers trading at Northside are Iceland, Heatons, Unicare, Euro General, Sportsworld, Northside Opticians, Café Misto Food Court and KFC.

The centre also offers a range of services to its customers including medical and dental surgeries, a WellWomen Centre, a post office and a credit union, as well as a furniture and bedding outlet.

Open-air scheme

Northside has had a number of owners since it was first developed in 1970 as an open-air scheme on drawings by architect Sam Stephenson. The property has been refurbished and revamped on several occasions since then, with the most recent work carried out by Patron Capital in 2016.

Both HWBC and Savills declined to comment on the sale when contacted by The Irish Times. Agent TWM similarly declined to comment on its handling of the purchase on behalf of AM Alpha.

While Northside Shopping Centre is AM Alpha’s first investment in Ireland’s retail property sector, the company has been active in the past in the Dublin office market.

In 2012, the Munich-headquartered investor paid €35.5 million for Riverside II, a 6,784sq m (73,022sq ft) office block on Sir John Rogerson’s Quay in the Dublin docklands.

The price paid represented a relative bargain when compared to the €60 million valuation attached to the property in 2006 when it was under the ownership of the Elliott, Kelly, Flynn and McCormack families.

AM Alpha secured a gross profit of €14.5 million from Riverside II when it sold the building on 18 months later to Irish property fund Iput for about €50 million.