Property fund IPUT pays €115m for bank’s staff pension assets

The fast-growing Irish commercial property fund IPUT plc has acquired a portfolio of Dublin-based assets from the Bank of Ireland staff pension fund for an all cash payment of €115 million.

The deal will provide IPUT with a blended income yield of 7 per cent and push the overall value of its property portfolio to over €1 billion.

The 13 institutional grade properties in the Salix fund includes Topshop at St Stephen's Green, the Karen Millen store on Grafton Street and a 50 per cent interest in the extensive B&Q retail warehouse at Liffey Valley.

The 13 newly acquired properties are currently producing a rental income of about €8.4 million. The deal was also to have included a 7,432sq m (80,000sq ft) computer centre rented by the Bank of Ireland at Cabinteely, Co Dublin, but the pension fund withdrew it from the sale just before negotiations were wrapped up.

The fund has apparently also sold several property investments in the UK over the past three years. IPUT has become one of the bigger Irish players in the commercial property market since the 2008 crash, spending over €500 million alone on 27 property investments since January, 2013. Its largest purchase was an office investment at Grand Canal Square in the Dublin docklands which cost €90 million.

Niall Gaffney, IPUT chief executive, said yesterday his fund had an established record in assisting larger institutional investors consolidate their investment in property as an asset class. The Bank of Ireland deal followed on from previous IPUT acquisitions of the property assets of other institutional investors such as the ESB, Diago and Irish Airline Staff Pension Fund which amounted to almost €200 million.

IPUT is understood to have put a value of over €20 million on the 2,500sq m Topshop which is producing a rental income of €2 million. The 929sq m (10,000sqft) Karen Millen shop is thought to be under rented at €450,000 per annum.

The portfolio also includes North Dublin Corporate Park in Swords which accommodates five modern industrial buildings with an overall floor area of 9,940sq m and two adjoining high bay warehouses in Kilcarberry Distribution Park on Nengor Road, Dublin 22, occupied by the BWG group.

Office buildings in the sale include Ericsson’s Dublin head office in Clonskeagh, Dublin 14, which has a floor area of 4,645sq m and a block in East Point Business Park, Dublin 3.

The sale also includes a one-third stake in the IDA headquarters at Wilton Place.