Kennedy Wilson to pay €95m for Elysian Tower in Cork
Mergers watchdog must investigate sale before permission can be given
Developer Michael O’Flynn in front of the tower, which his group built in 2008, just as the Republic’s property market was collapsing. Photograph: Daragh Mac Sweeney/Provision
Kennedy Wilson, owner of more than 1,000 apartments in Dublin, recently emerged as fellow US firm Blackstone’s preferred bider for the Elysian, a 17 storey property close to Cork city centre.
Mergers watchdog, the Competition and Consumer Protection Commission (CCPC) announced on Wednesday that Kennedy Wilson had notified it of the deal, which the regulator can block if it believes it will damage competition.
It is understood Kennedy Wilson has offered to pay €90 million to €95 million for the block, which contains 217 apartments, one of which was let recently for €3,000 a month.
If the deal goes ahead, it will be Kennedy Wilson’s first significant step outside Dublin, and add the Elysian to a property hoard that includes the Shelbourne Hotel on Stephen’s Green in Dublin.
Developer Michael O’Flynn’s group, O’Flynn Construction, spent €100 million building the Elysian, which was completed in 2008, just as the Republic’s property market was collapsing.
Bids for the tower
Blackstone sought bids for the tower last year. The private equity fund took over the Elysian in early 2014 in an agreement resolving a dispute with the O’Flynn group, which continued to manage the property.
Blackstone paid the O’Flynn Group a further €5 million to complete a fit out of some of the landmark block’s apartments in 2016.
The CCPC must investigate the sale to Kennedy Wilson to establish that it does not damage normal commercial competition before allowing the sale to go ahead.The commission will carry out a phase-one investigation of the sale, which can take up to 30 working days, before deciding whether to approve it or move to a more detailed phase-two inquiry, which could take several months.
A phase-two investigation could result in the CCPC blocking the deal, approving it or imposing conditions on the parties involved before allowing it to go ahead.
Kennedy Wilson owns Clancy Quay near Kilmainham, the Alliance on South Lotts Road and Sandford Lodge in Ranelagh among other apartment developments in Dublin. It owns about 1.5 million sq ft of offices in the capital.
In a presentation to investors, Kennedy Wilson describes itself as a “dominant” player in Dublin and says that it earns $18 million (€14.6 million) a year net operating income from its properties in the city.
Neither Kennedy Wilson nor Blackstone would comment on the deal yesterday.