Palm Capital closing in on €200m purchase of Core Industrial portfolio

UK-headquartered private equity giant set to acquire assets across greater Dublin area

An aerial view of Naas Enterprise Park. The 125-acre scheme is the Core portfolio’s largest single asset

An aerial view of Naas Enterprise Park. The 125-acre scheme is the Core portfolio’s largest single asset

 

Real estate private equity giant Palm Capital is closing in on the purchase for more than €200 million of the Core portfolio, a collection of industrial and logistics assets distributed across Dublin and the greater Dublin area.

The UK-headquartered investor has been selected as preferred bidder for the portfolio in the face of competing bids from M7 Real Estate, Arrow Capital Partners and Ares Management.

The price being paid by Palm Capital represents a significant premium on the €170 million the joint selling agents, CBRE and Eastdil Secured, had been guiding when they offered the portfolio for sale last April.

It also represents a particular coup for the vendors, Core Industrial, coming as it does just over three years after it pulled back from an initial public offering on account of “prevailing market conditions”.

The €200 million figure marks a significant uplift on the valuation Core had ascribed to its assets in 2018.

In an announcement published in advance of its then-proposed IPO, the company said its 106 industrial assets and 167 acres of land (of which 36.7 acres were zoned for development) in the greater Dublin area had a value of €82.9 million in total as at November 30th, 2017. It is understood the portfolio now being acquired by Palm Capital differs in terms of its composition.

While the Core portfolio includes properties in Rathcoole, Clondalkin and Finglas, its largest single asset is Naas Enterprise Park in Kildare. The 125-acre scheme was acquired in 2015 by Core’s former backers, York Capital, for €17 million. The New York headquartered hedge fund exited from Core Industrial in 2019.

In its most recent set of accounts filed with the Companies Registration Office, Core Industrial Properties reported that its asset base had risen by 10 per cent to more than €100 million in 2019, ahead of a major refinancing and its decision to put the Core portfolio up for sale. The increase was driven largely by an 8 per cent uplift in the value of its investment properties.

Commenting on the impact of the Covid-19 pandemic on its business, the company, which is led by Daniel Donovan and William Redmond, said in its accounts that its industrial portfolio had “held its value”.