The property investment market in Ireland's second city hit new and record highs in 2015, far out-stripping 2014's much-recovered market, according to a new report due shortly from DTZ Sherry FitzGerald.
Describing 2015 as a remarkable year of performance, DTZ say that last year "was a record-breaking year for Cork property investment, following a bumper closing quarter". A total of €136 million was invested in Cork's commercial property during 2015, as investors and REITs looked outside of the capital for more competitive returns.
That €136m outturn for 2015 contrasts sharply with the previous high of €79.7 million recorded in 2014, notes DTZ.
The two largest investment purchases, totalling €93 million between them, practically face one another across Cork city's River Lee, and are the €58m purchase by Green REIT of One Albert Quay from John Cleary Developments (final deal closing of the almost fully occupied new build is expected within days,) and the €35m acquisition of the Clarion Hotel by Dalata.
Late last month, Dalata also announced its further €40m acquisition of the leasehold interest on four hotels, including the Clarion Hotels in Cork and Limerick which will now be rebranded as Clayton Hotels, with upgrade works set to follow.
Domestic capital was the main driver of investment sales in Cork in 2015, accounting for 85% of the value of transactions. The €136m tally reported this week by DTZ does not include loan/portfolio sales, so the €70m valuation put on the Wilton Shopping Centre as part of the Hazel Portfolio is not included, nor are the sales of the Shipton Group's former shopping centres in Blackpool and Douglas Court.
A key trend in the Irish investment market in 2015 was the rise in the volume of investment sales outside of Dublin, driven by strengthening economic conditions, higher yielding opportunities (relative to Dublin) and positive rental growth: the share of spend outside of the capital increased to 18% in 2015, compared with just 5% in 2014, with the Cork investment market the strongest.
Peter O'Flynn, MD DTZ Sherry FitzGerald Cork said "2015 set a new high watermark for Cork commercial property investment, with turnover boosted by a number of high-profile deals, including the acquisition of One Albert Quay by Green REIT and the purchase of the Clarion Hotel by Dalata Hotel Group".