This post continues our focus on the new phase of development in the Dublin Docklands. In the past we’ve written about the Docklands Strategic Development Zone (SDZ), the absence of community participation and the displacement of the local cultural scene by new developments. Here we just provide an overview of the five major new developments happening in the Dockland’s SDZ, all of which involve NAMA. Indeed the so-called ‘bad bank’ has been turned, without any apparent debate or even legislative basis, into a development agency for the area. Although it lacks even the most basic democratic dimension or accountability, NAMA is financing development, selling huge swathes of land and doing deals with some of the biggest financial firms in the world.
The Boland’s Mill development seems to be a kind of ‘legacy project’ for NAMA. Unlike all the other developments, NAMA is essentially doing this development itself. Mark Reynolds of Savills was appointed as statutory receiver for the property a few years back, and it is Savills who are undertaking the development. However, the whole thing is financed by NAMA (expected cost is €150 million) and the agency has seemingly played a strong role in the development process thus far. A planning application for the site was submitted late last year and the City Council recently issued a ‘request for further information’. Presumably permission will be granted in the near future. The site, which appears to have been connected to Treasury Holdings and was bought for €42 million during the boom, encompasses 33 & 34 Barrow Street together with 35A Barrow Street & 35 Barrow Street (Car Park). It stretches from the corner with Ringsend Road up to the Warehouse and Southbank House offices.
The development as currently proposed will feature 36,759 sq. m of office, residential, retail and café, restaurant, and cultural exhibition space. It also involves a new street (described as a ‘civic street’, although it is unclear how this differs from a regular street) and a new square that will open up waterfront access on that side of the canal. There will be three new buildings, two focusing on office space and the third on residential (42 apartments).
Brendan McDonagh, NAMA CEO, said: “the development of the Boland’s Mill site of almost 400,000 square feet of commercial, residential, retail and cultural space, including 42 apartments, will be very positive not only in terms of bringing greater vibrancy to the South Docklands area but also in terms of addressing the shortage of quality office and residential accommodation in the Central Dublin Business District”.
There are two major new developments on Hanover Quay, one of which backs on to Sir John Roggerson’s Quay. If you take a stroll down there you’ll see construction already underway and hoarding around the sites with the Bennett Construction logo. Targeted Investment Opportunities PLC is developing both of these sites. TIO is a Qualifying Investor Fund, a particular form of ‘tax efficient’ vehicle for investing in property and other financial assets. TIO has been regulated by the Central Bank since July 2013. NAMA, Oaktree Capital and Bennett Group are the three shareholders. Oaktree Capital is a US hedge fund with almost $80 billion worth of assets under management. It has snapped up other NAMA properties, including Project Albion.
TIOs directors include Barry O’Leary, Justin Bickle, John Mulcahy (former NAMA head of Asset Management), Jim Bennett and Anthony Noonan, and the company has an address at 25-28 North Wall Quay, Dublin 1.
The first of the two developments on Hanover Quay is the Reveal Development. This is the work of the South Docks Fund, a sub-fund of TIO. NAMA is reported to have a 16.5% stake in the SDF. The second development is on 6-8 Hanover Quay and is run by the City Development Fund, also a sub-fund of TIO and this time with NAMA holding a 47.8% stake.
The Reveal Development
The South Docks Fund submitted planning permission for the properties at 5 Hanover Quay and 76 Sir John Roggerson’s Quay in December 2014. As a whole, the development consists of 42,500 sq mt of offices and apartments and has an estimated construction cost of €140 million.
There are two parts to the development. 76 Sir John Roggerson’s Quay will be somewhat smaller, with 9,300 sq. m and 58 apartments (ranging from 1-3 bedrooms). The ground floor will feature offices and retails space and will look on to the future Chocolate Park, part of the ‘public realm’ aspect of the SDZ development plan. 5 Hanover Quay will provide around 18,000 sq., of office space and 100 apartments, and will also feature office units and retail on the ground floor.
6-8 Hanover Quay
The City Development Fund obtained planning permission for this site in April 2014. The development is predicated on the eviction of the Mabos cultural centre, which we’ve written about here.
This building will include 4,600 square metres of office space and has already been pre-let to a well known US internet company for its European headquarters. This is a low-rise building and because some architectural features are protected the new development will maintain some aspects of the original building.
This is perhaps one of the most ambitious new developments and is located at very end of Sir John Roggerson’s Quay where Grand Canal Dock meets the Liffey. The ill-fated U2 tower was supposed to be built here, but of course fell through. This is another Joint Venture between NAMA and an international firm. This time the partner is the extremely active Kennedy Wilson, an LA based real estate development firm who launched a European division on the London Stock Exchange last year and has been on a spending spree buying up vast swathes of property in Dublin.
KW and NAMA have submitted a planning application in April 2013 for a major development on the 5 acre site. One the buildings will be a nineteen story tower while overall the development will provide 300,000 sq. Ft. of office space and 204 apartments. There will also be a park and square as part of the development (checkout the development’s commercial brochure for more detailed info).
72-80 North Wall Quay
This is the only large development taking place on the North Side thus far (with the exception of the completion of Spencer Dock by Hines with financial backing from King Street Capital). It is currently a large vacant lot (2.3 hectares) facing onto the Liffey, located between the Central Bank HQ (former proposed Anglo HQ building) and the Point Village.
The site was sold to Oxley Holdings and Ballymore Group, the latter owned by top Irish developer Sean Mullryan who is in the process of exiting NAMA. These two have already joined forces for the gigantic Royal Wharf development in London. Oxley, who put up most of the finance, is a Singapore based real estate development firm and describes itself as “a lifestyle property developer that caters to the upwardly mobile homebuyer and entrepreneur”. The development is once again largely office accommodation (645,00 sq ft) and also host 200 apartments.
This site itself was not sold, rather NAMA sold a ‘leasehold’ while maintaining the ‘freehold’. What this means is that Oxley/Balymore have bought the rights to develop the site and sell any assets. NAMA will be entitled to a portion of the development gain and will also maintain a degree of control over the development. The leasehold was also sold on the basis of a contract which ties the development to a five year timeframe for completion.
Looking at the five developments as a whole, one observation is particularly striking. Whereas NAMA’s general strategy is to sell large packages of assets to international funds, in each o these five developments NAMA has maintained a degree of control over the sites. It has done this by selling sites into joint ventures in which it retains a stake (e.g. the Hanover Quay and Capital Docks developments), by maintaining the freehold on the site (e.g. North Wall Quay) or by directly developing the site itself (Boland’s Mills). The logic for this seems to be that the government want to use NAMA to deliver ‘prime office’ space as part of the wider economic strategy of attracting foreign direct investment. If the sites had been sold to purely private actors, they may have sat on them and waited for their value to rise. By maintaining a degree of control, NAMA ensures that development commences immediately. As well as becoming a development agency, then, NAMA has also become an aspect of wider economic policy.