Embassies pick up prime sites at knockdown prices

Many countries with an established state presence in Ireland have for decades amassed some of the capital's most valuable properties. Few have sold up thanks to heavily reduced property values; however, the small cohort which have bought in recent times have picked up some of Dublin's best homes for a fraction of their boom-time values.

In some cases multimillion-euro properties have been picked up and remain empty. Others, such as the embassy of the Russian Federation, opted to extend and improve their existing properties. The embassy has had a presence in Ireland for more than 40 years, comprising its 5.4-acre Rathgar property acquired in 1974 and its ambassador's residence on one acre at 75 Ailesbury Road purchased a year later.

The Russian Federation is planning a large development in Rathgar of more than 8,300sq m (89,000sq ft), including an enlarged embassy building, two apartment blocks and an underground car park. Combined with its own ESB substation, fuel store, recycling and waste centre, children's playground and tennis court, the grounds of the embassy will be effectively transformed from a verdant estate in to a small village.

While the Rathgar and Ballsbridge properties owned by the embassy are put to good use, another lesser-known property has lain idle. Since the 1980s the Russians have owned Loyola in Foxrock, directly across the dual carriageway from the Portuguese and Indian ambassadors’ residences at Knocksinna. The private 3.2-acre spread comprises a detached period house flanked by a mish-mash of flat-roofed extensions, a large car park and separate garage.

With access from Stillorgan Road and substantial frontage (120m) on to Granville Road, the property is one of the best undeveloped sites in an area that has seen a flurry of activity in the last year.

Five properties in the immediate vicinity of Loyola are being redeveloped – or at least their owners want to redevelop them – with lands totalling 6.98 acres. Funchal, Aberdour and Springfield House are three such properties, which were failed development plays during the Celtic Tiger and which were recently sold to new owners.

Prices achieved for Funchal and Aberdour of about €2.14 million and €2.03 million per acre respectively would indicate that the Russian Federation’s land could be worth well over €6 million. Based on the council’s development plan, developers would be encouraged to build at least 65 homes on its lands if they were sold.

Development opportunities

The embassy of Saudi Arabia is in a similar position, having purchased Gortanore in the heart of Foxrock village in 2013 for about €5 million. The knockdown price is a world away from the €31 million paid by a local developer in 2005. The modest 1920s house sits on a prime 2.85-acre site. It is considered to be one of the best available in the desirable south Dublin suburb, offering both residential and commercial development opportunities.

Since buying the property, the Saudis have not touched the house, with each new ambassador seemingly choosing different homes to suit their own needs. Fortunately for the Saudis, since purchasing Gortanore, land values in the area have skyrocketed. Should they eventually decide to build, they will be in good company as a number of Dublin's most impressive ambassadors' residences already line Brighton Road and Brennanstown Road, including Japan's Oakfield House, Korea's Seoul Manor and Egypt's Egypt House, while a number of others rent on the road.

In Blackrock, the embassy of the United Arab Emirates is also sitting on a substantial property, having purchased The Willows on Cross Avenue in 2012 for about €5 million, some 70 per cent off its original €16.5 million asking price in 2008. While the UAE's former ambassador made a rather public departure from Ireland in 2014, it is believed neither he nor his successor has ever occupied the lavish Blackrock mansion, opting instead for a penthouse in the Merrion Hotel and later Johnny Ronan's "Pink Palace" on Burlington Road.

The Willows was once a symbol of the Celtic Tiger: the comfortable 650sq m family home of one of Ireland’s wealthiest couples, the property was acquired in the 2000s by a prominent developer, who enlarged it to more than 1,100sq m. The embassy had originally planned to construct a new 92sq m structure to house staff and to adopt an impressive landscaping plan, but it appears they have since abandoned these plans.

The Belgian embassy bagged a bargain when it purchased 1 Elgin Road for €2.7 million. The 390sq m house, which required total refurbishment, was bought by Derek Quinlan in 2007 for €7 million. Two years and one expensive renovation later, the finished product hit the market asking €7.5 million and failed to sell, before eventually being bought by the Belgians in 2011 when it came back on the market at a greatly reduced €2.95 million. Nearby, at 8 Raglan Road, another Quinlan property, the Turkish embassy shelled out a reported €6 million in 2012 for the 934sq m offices, which were in immaculate condition.

‘Golden triangle’

The embassy of the People's Republic of China has been expanding too, but has a penchant for Dublin 4's golden triangle of Ailesbury Road, Shrewsbury Road and the stretch of Merrion Road linking them. For years the Chinese owned three properties on Ailesbury Road and rented on the other two roads; however, in 2012 they added a fourth property to their Ailesbury Road portfolio, acquiring number 38 in an off-market deal.

They have since linked that house with their embassy and now have a combined 965sq m of space. When the French chancery came up for sale next door to the Chinese in 2013, it looked to be a likely purchase, especially as the asking price was nearly 75 per cent off its 2008 high of €20 million. But the Chinese were not interested, and the mystery buyer – an heir to one of Ireland’s great fortunes – has let the property lie idle since.

The Chinese instead opted to purchase Nutley Lodge, adjacent to its property at 77 Ailesbury Road. The luxurious 673sq m house was asking €3 million, a bargain compared with today’s prices.

Neighbours were not pleased when they realised an embassy had bought it, raising concerns about commercial activity being carried out on Nutley Road. They objected, reminding the planners that the original owner of the property was only granted permission to build the substantial house with the condition that it would never be used for commercial purposes. However, the council sided with the embassy.

When it comes to their ambassador’s residence, however, the Chinese prefer to rent. They are currently content with renting Clonmore on Shrewsbury Road, the former home of property developer Paddy Kelly. Diplomatic postings last just a few years so renting is often the preferred option as it affords better flexibility.

Appealing selection

For well-funded ambassadors looking for the perfect Dublin base, there is an unusually appealing selection of prime Ballsbridge properties available at present.

Number 3 Shrewsbury Road, one of a pair of 1930s houses purchased by an investor in 2013 and totally renovated, is back on the rental market, seeking €17,500 per month through Hunters. This is up from the €15,000 per month sought last year when it was advertised for its first letting. The Malaysian embassy is renting the adjoining house.

The same agent is also seeking a tenant for Coolbeg at 14 Shrewsbury Road. The house was purchased for €4.4 million in 2012 by a local businessman who spent the best part of two years renovating and extending the detached Edwardian house. The property has been quietly for rent since about June of this year with a different agent, but only came on the open market in recent weeks. At €19,500 per month, the house is the most expensive rental in the country but is also most likely the finest home to hit the market in years.

Just around the corner, the home of an aircraft-leasing magnate, 16 Ailesbury Road, has been rented in record time through Sherry FitzGerald with an asking price of €18,000 per month, which included twice-weekly housekeeping and gardening services. With six reception rooms and detached accommodation suitable for staff, the superbly decorated house would have been perfectly suited to an ambassador.