WORK has started on one of the largest residential developments likely to be built in south Dublin in the next five years.

Cosgrave Developments will start building the first homes on the site of the former Dún Laoghaire Golf Club, in Dún Laoghaire, Co Dublin, before the end of the year.

Close to 1,500 homes are planned there altogether, with 848 to be built on roughly half of the 78-acre site.

Thirty houses and 140 apartments are likely go on the market by the end of 2010/early 2011. Market demand will dictate the speed at which the site is developed, Cosgrave Developments’ spokesman Paul McGrath said this week.

But at a time when work on most other property developments has been suspended, and there is a huge overhang of unsold new properties across Dublin, the company is confident that there will be demand.

“It is a unique site in terms of location,” said McGrath. “Although there is little new development in Dún Laoghaire to test the market, the second-hand market is strong.”

Cosgrave Developments bought the controversial golf club site for €20 million in 2002, and received planning permission to build 848 residential units, as well as offices and retail units and an eight-acre park with a lake on the the southern part of the site, in June 2008.

This covers roughly half the 78 acres and is bounded by Glenageary Road Upper (which bisects the site) and Kill Avenue.

The developer’s plan to build close to 600 houses on the northern part of the site, closer to Dún Laoghaire, is still in the planning process.

Dún Laoghaire-Rathdown County Council is expected to announce its decision by the end of October.

The first phase of the development could take up to five years to complete. Mr McGrath said it was too early to say how much units there would sell for, but at current market rates, two-bedroom apartments could sell from around €340,000 to €375,000.

Two-bedroom apartments in a development at nearby Baker’s Corner in Dún Laoghaire sold within the past month for close to €350,000.

Ivan Gaine, managing director of Sherry FitzGerald New Homes, says that the nearest comparison is Wyckham Point in Dundrum, where one-beds are currently selling for €239,000 and two-beds from €339,000. “The Dún Laoghaire Golf Club site is a very good southside location.”

Carolyn Coyle of Savills estimates that two-bedroom apartments on the Cosgrave site could sell from €375,000.

Cosgraves is building a mix of apartments in blocks up to six storeys high and houses for all sectors of the market, including social and affordable homes, on the site.

An Bord Pleanála granted planning permission for the development subject to 58 conditions, including payment of a levy charge to provide a bus service that will link the development with Dún Laoghaire Dart station.

The decision ended a marathon planning saga. The site was rezoned in 2004 after then minister for the environment, Martin Cullen, used his powers under the 2000 Planning Act to issue a statutory directive to the council to rezone more land in the area to provide extra housing.

Cosgraves bought Ballyman Glen, a 27-hole golf course in Enniskerry, and Dún Laoghaire Golf Club moved there in August 2007.