Boom-era apartment values rebound as big investors pour into Dublin PRS

If you're looking for an indicator of the buoyancy in Dublin's rapidly expanding private rented sector (PRS), you need look no further than the apartments at Beechwood Court in Stillorgan, in south Co Dublin.

Developed by the late Bryan Cullen's Jackson Homes at the height of the boom, in 2006, the exclusive scheme had commanded starting prices of €360,000 for one-bed units. Prices plummeted after the crash, as the pool of potential buyers evaporated overnight and has yet to replenish in any numbers.

But where the absence of individual buyers may have seen property values remain depressed in the past, prices at Beechwood Court, on the N11, have rebounded to an average of more than €431,500.

The dramatic recovery can be traced to the disposal of 101 units at the scheme as part of successive portfolio sales in 2015 and earlier this year. In the first instance the Beechwood Court PRS apartments accounted for about €24 million of the €120 million Nama secured from the sale of the Project Plum portfolio to the New York-headquartered Marathon Asset Management.

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As well as that money helping to clear debts to Nama related to the Jackson Homes business, the Project Plum process also ascribed an average value of €237,623 to the apartments at Beechwood Court.

Having secured ownership of the Stillorgan units, Marathon moved to take advantage of the surge in demand for rental accommodation in Dublin, increasing the gross annual rental income from €1.5 million to €2.08 million.

Earlier this year the US property giant secured an even more significant return on its investment in Beechwood Court by including the 101 apartments in its sale to Ires Reit of a portfolio comprising 815 apartments and houses distributed across 16 developments in Dublin and Cork.

Ires Reit’s acquisition of the XVI portfolio represents the largest single acquisition of buy-to-let properties to have taken place in the Irish market.

The Residential Property Price Register shows that the 101 units accounted for €43,584,000 of the €285 million Ires paid to secure ownership of the XVI portfolio. That figure equates to an average price of €431,574 for each of the Stillorgan apartments, an increase of €193,951 per unit – or 81 per cent on the average price per unit Nama achieved in December 2015.