Cairn to build 71 homes in north Dublin with Nama support

London-listed Irish housebuilder Cairn Homes has teamed up with the National Asset Management Agency (Nama) to form a joint venture to build 71 homes in north Dublin.

Nama has a minority interest in the new venture, which will entail Cairn building the new units at its Parkside development, off the Malahide Road.

Construction is due to commence on this site immediately with 52 units already sold for a combined €18.1 million.

The development, which is expected to be completed this year, will have an estimated gross sales value of €25 million.

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Cairn Homes began development at Parkside in January 2015 and has built and sold more than 166 homes with another 150 under construction.

"We are pleased to announce this joint venture with Nama which is in line with our strategy of building quality new homes on attractive sites in the Greater Dublin Area," Cairn Homes chief executive Michael Stanley said.

“This alternative operating model is a new departure for the company which we hope will offer us further opportunities in the future. The strong level of pre-sales we have seen demonstrates the pent-up market demand for well built, new homes in good locations,” he added.

Opportunities

Stockbroker Davy said the agreement, while small, shows that Nama is open for business with developers and, as the largest holder of residential land in the country, is interested in other opportunities to partner.

"The demand seen at the site has clearly been exceptional since the beginning of the year, with the continued shortage of supply and the recently launched help-to-buy scheme continuing to drive better conditions for selling homes," said Colin Sheridan, an analyst with Davy.

Cairn is expected to release 2016 results early next month, the first full year of results since its flotation. It returned to profit during the first half of last year as it ramped up housebuilding locally.

The group, which became the first Irish homebuilder to float on the stock market since McInerney Holdings in 1997 when it listed in 2015, recorded a pretax profit before exceptional items of €500,000 in the six months ending June 30th, 2016, compared with a €1.04 million loss for the same period a year earlier.

Revenue rose €16 million from €500,000, while gross profit increased to €2.6 million from €51,000.