Property owners including brothers Ulick and Des McEvaddy are selling a large Dublin Airport landbank, raising questions over the future of land seen as a critical national asset.
The brothers have joined fellow land-owners – Seán Fox, and Brendan and Orla O’Donoghue – to sell three connecting lots covering 260 acres in the centre of the airport grounds.
The decision presents a strategic and financial challenge to the Dublin Airport Authority (DAA). The State body now faces questions as to whether it spends potentially many millions of euro to block any other party from gaining control of real estate crucial to its long-term growth.
The land between the north and south runways will be presented as an “ideal location” for a third terminal in an international marketing campaign this summer. The sale comes amid concern the airport will soon reach capacity as travel recovers after pandemic disruption, although senior airport figures believe a new terminal won’t be needed for 20 years.
The vendors say the lands are “essential” to the airport’s development. Still, the DAA said the priority should be on new transport links with existing terminals rather than “speculative projects” on the other side of the campus “that aren’t required in the medium term and are devoid of transport links and other necessary airport services”.
The McEvaddys and the DAA have previously discussed a potential sale but disagreed on the price. “We continue to have interactions, including recently, and there’s still a difference in view on valuation,” said a senior airport source.
The brothers made their fortune with Omega Air, a business supplying mid-air refuelling services to the US navy. The sale of land held since 1996 ends their campaign to build a privately owned terminal, for which they never received government support.
They and the other owners now expect a high valuation on lands currently in agricultural use but zoned for airport use.
A car park site near the airport but not within the campus itself is reputed to have realised about €1.6 million per acre when the DAA recently acquired it for €70 million. The deal is under review by competition regulators.
The vendors insist that puts a potential price of hundreds of millions of euro on their land. But airport sources dismissed the argument, saying highly lucrative car parking would not be allowed on the site and that alternative aviation uses would not sustain a “stratospheric” valuation.
The fact that the land could be compulsorily acquired for airport purposes was a further barrier to an exceptionally high price, the sources added.
But in the first instance the DAA cannot prevent another buyer gaining access to the land without it – or another State body – spending a large amount of money to take the site into public ownership.
“There are limited international opportunities to acquire a single holding of this scale for a potential airport terminal, airport-related uses or logistics in such a high-profile and accessible location,” said manager of the sale John Moran, chief executive of estate agents JLL.
“This provides an exceptional development opportunity as there are no lands of similar zoning and location which are potentially designated for the short and medium-term development for one of Europe’s busiest and most well-connected airports.”
The three lots are being put on the market together or separately in a private treaty sale, a way of selling an asset in a deal negotiated privately instead of a public auction.
The owners are likely to cast the net widely among prospective bidders, taking out international adverts in the business and specialist aviation press with the aim of spurring any interest among commercial infrastructure funds or aviation investors.
Sovereign wealth funds may also be approached, prompting political questions for the Government if an arm of another state sought to buy into the airport.