US firm buys apartments at Clancy Barracks

A Californian-based investment group, Kennedy Wilson, is set to become the dominant landlord in the Dublin apartment letting market following its purchase of another "distressed" development of 420 residential units on the site of the former Clancy Barracks at Islandbridge, Dublin.

The Beverley Hills company has paid just over €80 million for the multi-family apartments overlooking the Liffey which will bring to 753 the number of units it now owns in the city. The company previously bought 210 apartments in te Alliance building at the Gasworks in Dublin 4 for €40 million, and 123 apartments in Sandyford Close in Ranelagh, Dublin 6, for €27 million.

There were 10 bidders for the Clancy Barracks development.

With a further 8.5 acres still to be developed at the site, Kennedy Wilson will have the option of providing an additional 500-plus apartments as well as a 15-storey hotel. However, it is thought unlikely the company will embark on a large construction project, particularly as many of the extra apartments are due to be located in 19th century army buildings which are listed for preservation.

Kennedy Wilson has been the largest purchaser of distressed property assets in Ireland since the property market collapsed in 2008.

Commercial properties
In addition to the three high profile apartment complexes which it now owns, it also purchased the State Street offices in the south Dublin docklands for €108 million and Brooklawn House office block in Ballsbridge for €15 million. It is currently in line to acquire a portfolio of 16 commercial properties, including Stillorgan shopping centre, formerly connected with developer Treasury Holdings for €306 million.

The €80-plus million paid for Clancy Barracks falls well short of the €230 million debt reputed to have been incurred on the site by the UK Lloyds-owned Bank of Scotland Ireland and the Danske Bank subsidiary National Irish Bank.

The hugely ambitious scheme was led by Jersey-based builder David Kennedy and reached an advanced stage of construction when the property market took a hit. He had earlier paid €25.4 million for the 13.5-acre barracks opposite the Phoenix Park.

Stephen Tennant and Paul McCann of Grant Thornton were appointed receivers by the banks, while the selling agent was Fergus O'Farrell of Savills.

Kennedy Wilson was advised by DTZ Sherry FitzGerald.