Naas Road site of 18.7 acres makes around €115 million

As in Sandyford, the Luas effect seems to be emerging in the Naas Road area of Dublin 12 where industrial sites now look like a far more lucrative proposition as potential residential land, writes Jack Fagan

The owners of several large tracts of land along the Naas Road and Long Mile Road in Dublin 12 will be reviewing its use following this week's sale of the Nissan headquarters and car compound to the Cork housebuilders O'Flynn for around €115 million.

The 18.7-acre site, which is likely to accommodate up to 800 residential units, has frontage on to the Naas Road, Long Mile Road and Walkinstown Avenue. Several different groups have been assembling sites in the immediate area in the expectation that Dublin city planners will allow some commercially zoned land to be used for housing because of its proximity to the Luas.

The high profile Nissan site, like the Irish franchise for the motor company, is owned by a Saudi Arabian businessman. However, the executive chairman of the Nissan group, Gerard O'Toole, is understood to hold a minority stake in the site.

The sale of the land to Michael O'Flynn's company will come as a surprise to many of Dublin's leading developers and site assembly companies who were unaware that it was to be disposed of by private tender.

The €6.15 million per acre valuation set in the Nissan deal will be of interest to a range of companies based in the same area, not least O'Flaherty Holdings, the giant motor distributors, which has at least 15 acres facing on to the Naas Road. O'Flahertys recently enlarged its land holding by buying the Lenwood cash and carry site at the rear of its original site.

By far the largest land owner is the businessman Pino Harris who has about 50 acres on both the Naas Road and the Long Mile Road. The drinks company, Gilbeys, owns about 10 acres while another strategically located 10-acre site fronting on to Long Mile Road is held by a group of businessmen. Motor retailer Padraig Mooney is also a significant land owner in the area.

The €6.15 million an acre valuation on the Nissan land is a long way ahead of the price paid last year for the 10-acre Coca Cola plant on the Naas Road. Estate agent Finnegan Menton acquired that landbank for a private client at a cost of a mere €2 million an acre.

While many of the motor distributors, like Nissan, may well feel that, with high land values in the area, it no longer makes economic sense to use their extensive grounds for car storage, the planners are unlikely to agree to a wholesale redevelopment of the area to facilitate a huge number of new homes. Industries on the Naas Road and Long Mile Road provide substantial employment and valuable rates revenue which is needed by local authorities.

One planning expert said he expected that the first few residential schemes in the Dublin City Council area would probably be approved but it would be "a long drawn out battle after that".

The changes envisaged in west Dublin replicate what has already taken place in the old Sandyford Industrial Estate where a large number of commercial buildings have been demolished to make way for high-rise apartment and office schemes.

In many ways the Naas Road area has a better infrastructure, including schools, shopping centres and parks, and it is a short three-and-a-half mile commute by Luas into the city centre. However, the proximity of Sandyford to prestigious areas, like Foxrock, seems to guarantee continuing demand for new homes.

Even before O'Flynns is in a position to lodge a planning application for a high density housing scheme on the Nissan lands, the new owners of the former Royal Liver Retail Park on the opposite side of the road are expected to unveil their plans for a mixed-use scheme to replace the slow-moving retail operation.

O'Flynns is understood to have acquired a number of small sites since setting up a Dublin operation. It recently paid a strong price of €22 million for the 2.82-acre grounds and home of the businessman Seán Barron overlooking Killiney golf course.