Balmoral International Land, a property company that was spun out of tropical fruits group Fyffes more than a decade ago, has told investors it expected its net assets to increase this year, helped by a previously-expected drop in the value of its UK holdings having not yet materialised.
Still, the company, which is majority owned by entities linked to the McCann family synonymous with Fyffes, warned that Brexit “remains a significant risk and could impact property values”, according to an update issued last week.
Balmoral is projecting a group net asset value in the range of 9c to 10c per share at the end of December, up from 7.68c on the year, saying that it now expected “satisfactory valuation increases” in its properties in Ireland and continental Europe. The company had previously anticipated a “modest” increase in both markets.
“The company is targeting further improvement in the years ahead, providing markets remain positive,” it said.
Japanese group Sumitomo, which took over Fyffes early last year for €751 million, moved within six months to sell the 30 per cent stake it inherited in Balmoral as part of the deal.
The buyer was a vehicle linked to the Balmoral’s chairman, Carl McCann, and his brother, David. This pushed the stake owned by members of the McCann family, or entities linked to them, to more than 55 per cent.
Fyffes and its former sister company, Total Produce, accounted for almost a third of Balmoral's €8.4 million rent roll last year. Balmoral was originally named Blackrock International Land when it was spun out by Fyffes in 2006 and listed on Dublin and London stock markets. It was delisted in 2011 following a slump in its share price during the property crash.
Some 64 per cent of the company’s portfolio is currently comprised of industrial and warehouse assets, 25 per cent office and 11 per cent mixed use land, according to its annual report for 2017.
The McCann brothers’ grandfather, Charles, set up a greengrocers on Clanbrassil Street in Dundalk in 1902 to become the first agent in Ireland for Fyffes, the then fledgling London-based banana importer.
In the 1950s, the McCanns brought a fragmented group of fruit wholesalers and distributors together under the United Fruit Importers of Ireland. It ultimately ended up being floated on the Irish Stock Exchange as FII plc in 1981 before going on to acquire Fyffes five years later from US rival Chiquita.