Irish property fund Iput expects to pay €1.2bn in dividends

Unlisted fund says it has 400,000sq ft of Dublin office space in the pipeline

Iput’s chief executive Niall Gaffney: “We’re regenerating our own income and growing that dividend organically from the portfolio.” Photograph: Eric Luke

Iput’s chief executive Niall Gaffney: “We’re regenerating our own income and growing that dividend organically from the portfolio.” Photograph: Eric Luke

 

The chief executive of Iput plc expects the unlisted Irish property fund to distribute about €1.2 billion in dividends to its investors over the next decade as its 400,000sq ft pipeline of Dublin office space is delivered to the market.

This would represent a major step-up in payments, with the fund having distributed about €500 million in the past 10 years.

“That’s a lot of cash going into shareholders’ pockets and it’s reliable cash, particularly for the pension funds and the insurance companies who have invested with us,” Iput’s chief executive Niall Gaffney told The Irish Times.

“Looking out over the next 10 years, based on our rental forecasts, we would hope to pay out closer to €1.2 billion. Our rental value is going to start moving towards €100 million per annum. We’re regenerating our own income and growing that dividend organically from the portfolio.”

Shareholders

Iput returned just under €82 million to shareholders in 2016, compared with €79.2 million in the previous year.

The fund is celebrating its 50th birthday in 2017, and has paid a dividend to investors each year. Its shareholders include Allianz, a number of large corporate pension schemes, and clients of Davy and Goodbody stockbrokers.

Iput’s net asset value rose to €1.99 billion in 2016, with the company signing five new leases in the fourth quarter to generate €3 million in additional income. It also secured permission to redevelop Fitzwilton House in Dublin.

Its pipeline of offices in central Dublin includes numbers 10 and 40 Molesworth Street, 47-49 St Stephen’s Green, and The Exchange in the IFSC.

On Brexit, Mr Gaffney said: “A lot of the expansion is going to come from international occupiers who already have a footprint in Dublin who will opt to expand here. But there’s not an avalanche of enquiries or anything like it.”

He said he expects future office rental levels in Dublin in “a band between €55 and €60” per square foot.

“There will be notable lettings in prime buildings done at €60 to €65 but we see the market settling at a sensible level.”