Irish Life Investment Managers is looking for rents of some €2,350 for a two-bed apartment at the new Fernbank development in Churchtown, south Dublin, the financial services company's first foray into the build-to-rent market.
The company paid about €128 million for 261 apartments and one listed building at the site, at an average price of almost €500,000, situated on land formerly owned by Notre Dame school in Churchtown, last May, raising the ire of the more than 1,000 people who had been interested in purchasing an apartment at the development. Last year Knight Frank suggested the site would yield about 5.32 per cent a year for Irish Life.
It’s the first move by Irish Life, which is owned by Canada’s Great West Lifeco, to position itself as an institutional landlord in the residential market. Its asset management arm expects to invest about € 1 billion for investors over the next couple of years acquiring properties that will be rented to tenants.
Described as a “luxury let” by rental agent Lisney, the furnished apartments are a short walk from Dundrum town centre, and come with an onsite concierge. Some of the two -beds come with a separate study, and the apartments also have a separate utility area, as well as underground parking. Viewing is by appointment only.
Park Developments developed the site, and agreed to complete after the sale, with the first units now hitting the market. When finished, in early 2020, the scheme will have 56 one-bedroom units, 188 two-beds and 17 three-bed apartments. The site also includes a listed building that must be retained as a single-use dwelling.
Much of the new supply in the residential apartment sector is coming from build-to-rent specialists, with Irish Life now joining the likes of US fund Kennedy Wilson, Irish listed property investment company Ires Reit and German fund Patrizia, in the market.
Increasingly, developers are looking to sell on partially completed apartment blocks to players in this sector, rather than selling them to individual buyers, as was the case with Fernbank. Cairn Homes for example, sold 120 apartments at Hanover Quay on Dubln's south docks, at an average price of almost €850,000, to Carysfort Capital last year, while Patrizia acquired 319 apartments, Ireland's largest build-to-let apartment development, at Honey Park in Dun Laoghaire, from Cosgrave Property Group back in 2017.
And in Dundrum, listed property group Glenveagh is currently weighing up a potential block sale of its Herbert Hill development, which lies directly across from the town centre. The development, of 90 apartments, is due to come to the market this year, and while the property group is currently gauging interest from individual buyers with Sherry Fitzgerald, it says that it is continuing to evaluate an institutional sale also.