Over 10,000 new housing units to be developed by State-backed fund

Fund and co-investors have now committed €8.1bn to investments in the Republic

More than 10,000 houses are to be developed with the support of the Ireland Strategic Investment Fund (ISIF).

The fund’s director Eugene O’Callaghan said it was involved in a number of investments in both residential housing and student accommodation. Some of the investments include direct funding of buildings while others relate to infrastructure aligned to property developments such as access roads, sewage pipes and parks.

Mr O’Callaghan said the ISIF was backing the development of at least 10,000 units, only a few of which would likely be completed this year.

“We would expect to significantly increase that number over the next few years. There’s good momentum in our housing investments at this point,” he said.

The €8 billion fund, which is designed to support economic activity and employment in the Republic, is managed and controlled by the National Treasury Management Agency (NTMA). It replaced the National Pensions Reserve Fund in 2010.

Mr O’Callaghan was speaking following an investor event at the Dublin Convention Centre on Friday. He said the fund was “acting as a major catalyst” for stimulating private sector investment in Irish businesses.

The ISIF and its co-investors have so far committed €8.1 billion to investments in the Republic, made up of €2.8 billion by the ISIF and €5.3 billion by co-investors.

Mr O’Callaghan said it was “significantly exceeding” its target for attracting private sector co-investment alongside its own and has a strong pipeline relating to 100 possible transactions with a combined value of €3 billion.

He said the fund is exceeding its original target of attracting €1 million in private sector investment alongside every €1 million it invests. The current private sector co-investment rate is €1.9 million alongside every €1 million invested by the fund.

The ISIF has also backed a number of infrastructure projects

The 140 Irish companies and projects supported by the resulting investment activity generate annual revenues in excess of €1 billion, 28 per cent of which is exported. Furthermore, they employ more than 22,000 people directly and indirectly.

Among the businesses the fund has backed are mobile marketing company Swrve, waste management firm AMCS, med tech investment group Malin, and non-bank lender Finance Ireland

The ISIF has also backed a number of infrastructure projects including Aqua Comm, an Irish-owned company laying a 5,475km fibre-optic cable across the Atlantic, from Long Island to Mayo, and the runaway upgrade at Shannon Airport.

The Irish Times reported just last week that the fund has teamed up with Fine Grain Property Ireland, to invest €100 million in revamping old commercial facilities and developing greenfield sites.

Mr O’Callaghan said ISIF had a wide-ranging remit and a broad portfolio that was centred around “enabling projects, growing companies and leading edge firms”.

“Our objective across the portfolio over the longer term is to achieve a 4 per cent return,” he said.

The ISIF received about €4.5 billion from the National Pensions Reserve Fund when it supplanted it and has also raised money through its own investments. In addition it has received capital payments returned to the State by BoI and AIB, as well as the €330 million realised from the sale of Aer Lingus to British Airways' parent IAG in 2015.


Charlie Taylor

Charlie Taylor

Charlie Taylor is a former Irish Times business journalist

Colin Gleeson

Colin Gleeson

Colin Gleeson is an Irish Times reporter