European investor pays €18m for Dublin 6 apartment portfolio

The European property firm, LRC Group, has increased the size of its Irish residential portfolio to nearly 1,900 properties, following the acquisition for €18 million of the Rathgar Road Collection.

The portfolio, which was offered for sale last September by joint agents DNG Advisory and BNP Paribas Real Estate, comprises six period properties, which have been redeveloped over the past 40 years by a private Irish investor to accommodate 61 purpose-built and market-rented apartments, and three commercial units. The portfolio also offers the potential for the development of a further 44 apartments.

The Rathgar Road Collection represents LRC’s third Irish acquisition this year. The deal, which closed last Thursday, follows on from its purchase in the first quarter of 47 apartments at Applewood in Swords and 102 apartments at Herberton in Dublin 8 for €9 million and €36.5 million respectively.

LRC’s most significant transaction here took place in April 2019, and saw it pay about € 150 million to acquire 600 mainly-residential assets across Dublin, Cork and Galway from Oaktree affiliate, Targeted Investment Opportunities (TIO).

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The apartments in the Rathgar Road portfolio are split between two sites at 175-178 Rathgar Road and 149 Rathgar Road in Dublin 6.

Numbers 175, 175a, 176, 177 and 178 Rathgar Road comprise 53 purpose-built apartments and three commercial assets producing an annual rent of around € 955,500. This site also includes a one-acre (0.404 hectare) residential development plot to the rear, which is capable of accommodating an additional 44 apartments, subject to planning permission.

Number 149 Rathgar Road comprises eight purpose-built apartments producing an annual rent of approximately €130,000 with a development site for a single mews to the rear (subject to planning permission).

All told, the Rathgar Road Collection is producing a total rent roll of about €1,085,500 per annum.

With no rent reviews undertaken by the portfolio’s vendors since the Government’s introduction of rent protection legislation, the joint selling agents estimated at the time of the sale that the prospective purchaser could look to increase its rental income by between 4 per cent and 8 per cent.

Both Gareth Noone of DNG Advisory and Damien McCaffrey of BNP Paribas Real Estate declined to comment on the sale when contacted by the Irish Times.

Outside of its significant and growing interest in Ireland’s private rented sector, the LRC Group has a major stake in the country’s hospitality sector.

In 2018, the company acquired the Irish-led hotel investment and management company, Amaris Hospitality, from US private equity firm, Lone Star in a deal valued at £600 million (€678.5 million).

Established in 1995 by Israeli investor Yehuda Barashi, the wider LRC Group has grown its presence across Europe to the point where it now has more than €5 billion of residential and commercial assets under management.