Nama to sell key west Dublin residential site via partnership deal

Receivers appointed by the National Asset Management Agency are to sell, through agent Savills, a key residential site within walking distance of the Liffey Valley Shopping Centre in Palmerstown, in Dublin 20, by way of licence agreement.

This method of sale, deployed with success by Nama and Savills on a site in Maynooth last year, grants a developer the right to develop the site as per the planning permission. The developer selected pays an initial deposit and both Nama and the "licence partner" then receive shared payments as each built residential unit is sold. Developers must also sign up to an agreed timeline for the development of the lands.

The sale process includes a published weighting system, upon which bids will be appraised, that places emphasis on price, track record of building similar product and ability to construct. As a result, the agent is not giving a guide price but the site, as it stands, could be expected to make between €7 million and €8 million on the open market.

This sales method is structured so that developers will not have significant initial funding requirements, as Nama has identified this as a major impediment to development given the stressed state of banks and their limited ability to lend, especially for sites.

Commitment

Nama maintains that such licence agreement sales are helping it to deliver its commitment to facilitate the construction of 20,000 new residential units in Ireland by 2020, subject to commercial feasibility.

Extending to 9.76 acres, the ready-to-go Palmerstown site forms part of the St Edmunds development and is within easy reach of the M50 and M4. There is planning permission for 102 terraced and semidetached houses.

"These homes would be extremely saleable, with house prices potentially achieving between €295,000 and €405,000, representing a possible total gross development value in excess of €35.55 million," says David Browne, head of Savills New Homes.

One licence agreement transaction has taken place to date and Nama says that, if the approach works well on its pilot projects, it is likely to be adopted more extensively in the future.

Construction of a licence agreement scheme of 136 residential units at Carton Wood is under way in Maynooth after the 15-acre site was offered for sale in June last year. About 18 developers, both domestic and international, pitched for the project and Anthony Neville Developments was selected.

The first units at Carton Wood are expected to hit the market shortly with more due over the next three years and, though Savills did not put a precise value on the Maynooth sites, they would have probably sold on the open market for between €50,000 and €60,000 each.

John Swarbrigg of Savills, who is handling the Palmerstown sale, says the licence agreement sales process was "well received by builders and developers last year with regard to the lands in Maynooth".