Real Estate January 2020
This month we look at the progress made in respect of deals currently in the planning process and the most recent sale that completed in Q4 2019. Our special focus looks at Limerick as a prospect for residential development and the article of interest for this month is CBRE’s Q4 review of the Irish Residential Investment Market for 2019.
Patrick Madden is a Manager on the Elkstone Real Estate team
ELKSTONE REAL ESTATE MARKET OVERVIEW
Since we completed the purchase of a site in Rialto in November 2019, Dublin City Council (“DCC”) released a list of sites that they are proposing to vary from the Dublin City Development Plan 2016 – 2022 (proposed Variations No.’s 8 – 27) so that the lands identified on the list (which are currently zoned industrial uses – Objective Z6) are rezoned for primarily residential and mixed uses. Our site was included in this list and DCC have proposed to rezone it entirely to residential (Z1) use. Together with our planning consultants we made a submission to DCC to provide DCC with an evidence-based justification to support their proposed rezoning to Z1. We expect to hear confirmation of whether the site is rezoned to Z1 residential or not by March 2020.
The Whitehall planning application will be submitted as OcaVerde, Whitehall to An Bord Pleanála this week. The 124 unit build-to-rent scheme is located on an infill site between the existing Bonnington hotel and the Grace Park Manor apartments. A website will be available for investors who are interested in seeing the proposed development. A decision from An Bord Pleanála is expected in May this year.
The 0.05 hectare corner site at Oliver Bond St, Dublin 8 was sold in December 2019. The site was the subject of a design by John Fleming Architects and received a grant of planning for a 71 bed aparthotel in April 2019. The property was marketed by Savills Hotel team in Q3 2019.
SPECIAL FOCUS THIS MONTH: LIMERICK CITY – A RESURGENT INVESTMENT HUB
The economic downturn had a substantial impact on Limerick beginning with the closure of Dell’s primary European Manufacturing Plant in 2009. At the time, the plant’s operations made up 5.5% of Irish exports and accounted for 2% of Ireland’s GDP. It’s cessation led to 1,900 job losses. Many core retail businesses in the City Centre also closed during this time. At it’s peak in 2012, the unemployment rate in Limerick stood at 28.6% which was nearly twice the national average.
A Strategy for Growth
In 2013, Limerick City and County Council launched it’s ‘Limerick 2030 – An Economic and Spatial Plan’. The plan is a collaborative effort brought about by engagement with public, business and voluntary sector stakeholders. The 3 main elements of the strategy are set out below:
- An Economic Strategy aimed at employment creation and attracting investment;
- A Spatial Plan to gentrify and redevelop the City Centre; and
- A Marketing Plan to highlight Limerick’s unique selling points.
Since the plan was launched Limerick has been on an upward curve. In the 5 years to 2018 over 15,000 jobs were created with unemployment falling to 5.8% in the region. Investment is up 46% in the same period with over €2.2bn injected between new and existing companies. An integrated effort between industry and academia has played a key role in the Limerick renaissance with 25,000 third level students in the City and one of the biggest Cooperative Education programmes in Europe seeing students undertake relevant work experience as part of their degree. Taking the case of Limerick Institute of Technology in particular we see that 72% of graduates choose to remain and take up employment in the Mid-West region.
The future success of Limerick will be underpinned by a number of key developments in the City Centre. These are primarily in retail and commercial office space leaving huge scope for residential development and investment. Some of the main developments are highlighted below:
- Gardens International – 80,000 sq ft of Grade A office accommodation;
- Opera Centre – 450,000 sq ft campus to include office, retail, restaurant and an aparthotel;
- Arthur’s Quay – A €60m redevelopment of the City’s shopping centre; and
- University of Limerick – The City Campus will cater for approx. 2000 students upon completion.
Limerick continues to present itself as a viable and attractive alternative to Dublin for companies and talent alike. The framework for rejuvenation in the City has worked to counterbalance the ‘donut effect’ which has seen schools, businesses and shopping centres locate in peripheral areas. The lack of residential development in the City combined with comparable rents (€176 cheaper than the national average) and the expected influx of students and workers make Limerick an attractive prospect for residential investment.
*Statistics sourced from:
- Limerick 2030 an Economic and Spatial Plan for Limerick
- Limerick Economic Monitor
Real Estate Article
This month’s article of interest is the Q4 review of the Irish Residential Investment Market from CBRE – read more here.