Kennedy Wilson and AXA IM - Real Assets, acting on behalf of their recently formed Irish PRS joint venture, have entered into a contract to acquire 274 units at the Grange, in South Dublin, Ireland, as well as an adjacent four-acre PRS development site for €161m. The joint venture anticipates that the acquisition will close by the end of Q3-2018.
The acquisition will comprise 274 high-quality PRS units, 275 car parking spaces and a substantial four-acre development site, all forming part of the larger 506-unit signature Grange project, which sits in the affluent south Dublin suburb of Sandyford. Over 60% of the units under contract were completed in the last five years, with the remainder completed in 2007. The units are all furnished to a very high standard, have a current occupancy of 95% and are significantly under-rented compared to prevailing market rents.
The joint venture intends to apply for planning permission to substantially increase its holdings at the Grange through the development of additional units on the adjacent development site. High-quality resident amenities will be developed to include a gym, lounge area, business centre and an on-site management office, serving both the existing and new joint venture-owned units. It is anticipated that construction will begin next year with new units and the resident amenities delivered during 2021.
Mary Ricks, President and CEO of Kennedy Wilson Europe, said: “The Grange is a market leading high-quality residential community in the rapidly expanding Sandyford area that fits very well into our new joint venture portfolio. We anticipate strong NOI growth as we have ambitious plans to add further units to the development over the next three years. We are big believers in the Sandyford market, where robust market dynamics prevail, with new office developments, continued employment growth, excellent public transport and great local amenities make this the top PRS location in south Dublin. We look forward to bringing our best-in-class approach to managing the units and delivering great homes for residents.”
John O’Driscoll, European Head of Transactions at AXA IM - Real Assets, commented: “This investment is directly in line with the stated strategy of our JV and increases its portfolio of designated PRS units in the attractive Dublin market to a meaningful scale. The Grange is a high-quality scheme in a well-connected and desirable location that benefits from increasing occupier demand in line with local employment growth and supportive underlying market dynamics. Furthermore, there is attractive long-term prospects to increase the rental intake, both through the currently under-rented units and the significant on-site development potential. We look forward to bringing our JV’s best-in-class approach to incorporating this latest investment into our wider PRS platform, while we continue to review new opportunities to build scale across large urban centres in Ireland.”