Stillorgan apartment portfolio at €9.7m offers 5.5% yield

With Dublin’s private rented sector (PRS) market continuing to thrive in the face of the Covid-19 pandemic, the sale of 25 high-end apartments on the city’s southside is expected to see strong interest from a range of Irish and international investors.

Located at the Atrium in Beechwood Court, Stillorgan, the portfolio, which is for sale through agent CBRE at a guide price of €9.7 million, comprises 24 two-bedroom units and one three-bedroom unit, along with 25 car parking spaces at basement level. Eight of the apartments have been held vacant while the remaining 17 units are being sold with the existing tenants in place.

The projected stabilised net rental income is approximately €556,000 per annum, assuming 100 per cent occupancy and completion of rent reviews, in line with Residential Tenancies Board (RTB) legislation. The €9.7 million guide price equates to a gross yield of 5.5 per cent assuming the stabilised net rental income is secured by the new owner.

Attractive price

Prospective purchasers of the portfolio will be attracted also by the average price per unit of €388,000. Quite apart from representing a discount to the break-up value of the portfolio, the figure is substantially lower than the average price of €431,574 Ires Reit paid when it acquired 101 units at Beechwood Court for €43,584,000 in 2019. The transaction formed part of Ires Reit’s €285 million purchase of 815 apartments and houses distributed across Dublin and Cork from New York-headquartered Marathon Asset Management. The sale of the so-called XVI portfolio remains the largest single acquisition of buy-to-let properties to have taken place in the Irish market.

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Developed by the late Bryan Cullen's Jackson Homes in 2006, the Atrium and wider Beechwood Court scheme occupies a prime location along the N11 approximately 1km from Stillorgan village and 8km from St Stephen's Green in Dublin city centre. The development enjoys easy access to the city and beyond thanks to its position on the N11 quality bus corridor, and its close proximity to the M50 and M11 motorways, and the Luas Green line stops at Sandyford and Stillorgan.

Local workforce

Beechwood Court is extremely popular as a rental location with employees of the major corporates based in the nearby Sandyford Business District. Google, Microsoft, Facebook, Mastercard and Vodafone are among those with offices in the area.

Stillorgan meanwhile offers an abundance of amenities with a wide range of shops, cafes, restaurants and bars. In terms of sports and leisure, Leopardstown Racecourse, Foxrock Golf Club, and Kilmacud Crokes GAA Club are all located within a short drive of Beechwood Court.

The Atrium portfolio is being sold by CBRE on the instruction of statutory receiver George Maloney of RSM Ireland.

Commenting on the sale, they say: “The multifamily sector continues to perform well regardless of underlying economic conditions and the impact of Covid-19, with cashflows and yields in this sector proving particularly resilient over recent months. As such, there continues to be a strong depth of capital looking to deploy into the residential sector in Ireland, especially for assets which are income-producing.”