Kennedy Wilson Europe, which owns more than € 1 billion of Irish property, is eyeing up a further stream of companies relocating from the UK post-Brexit.
In its first-half results published on Friday, the UK-listed property group said it is seeing “additional demand from Brexit-related inquiries” and it expects to see “further Dublin relocation announcements over the rest of the year”.
In the six months to June 30th, the group reported a 2.1 per cent increase in adjusted net asset value per share to 1,241.4 pence, with net operating income up by 1.3 per cent to £79.7 million (€88.5 million).
The investment fund, which has about a third of its total portfolio invested in Ireland, is positive on the outlook for residential growth, noting that “Dublin continues to show positive population growth projections”.
Despite the introduction of a residential rental cap of 4 per cent, which applies to “rent pressure zones” for a period of three years, Kennedy Wilson said that given its portfolio is 7.8 per cent under-rented as of the end of H1, it expects to benefit from rental growth in future periods. The group’s recently developed Vantage Phase II units in Sandyford, south Dublin, are exempt from this rental cap, as will be any existing unit which has undergone substantial refurbishment, the group said. Apartments are currently renting in the development for about €3,000 for a three-bed unit.
Hotel market
Across the hotel market, Kennedy Wilson continues to see growth, with Dublin revenue per available room (RevPar) up 5.2 per cent year on year.
The group said it has completed renovation of the 135-room Portmarnock Hotel & Golf Links, Co Dublin, at a cost of €9.8 million. The upgrade is feeding through to bookings, with weddings for 2017 so far up by 88 per cent on all of 2016, and RevPar up by 28 per cent.
On the retail front, the property group’s two-year refurbishment of Stillorgan Shopping Centre, Co Dublin, continues with construction of the new Tesco extension expected to be completed by the end of the year.
Kennedy Wilson said that renewals with existing tenants have generated a 13.2 per cent rental uplift, and it expects to “further improve the tenant mix while increasing the rent roll”.
At the nearby Leisureplex site, which it acquired in 2016, it is at design stage of an “exciting new mixed-use scheme which could add a further 200,000sq ft, subject to planning”.
