When BVK, Germany’s largest pension fund, and Frankfurt-based asset manager Universal-Investments completed the €630 million purchase of Dublin’s Liffey Valley Shopping Centre in December, the deal meant four of Ireland’s five largest shopping centers had been picked up by institutional investor capital in under a year.
In March, German fund manager Deka Immobilien bought Whitewater Shopping Centre in County Kildare for €180 million. In May, US private equity firm Blackstone acquired the Blanchardstown Shopping Centre in Dublin for €940 million. In July, German insurer Allianz purchased Ireland’s largest shopping mall, Dundrum Town Centre, also in the Irish capital, for more than €1 billion.
The seller in the Liffey Valley transaction was a consortium comprising Texas-based commercial real estate firm Hines and UK property firm Grosvenor. In 2014, Hines acquired a 73 percent stake in Liffey Valley for around €250 million, which valued the shopping center at around €340 million.
Brian Moran, senior managing director of Hines Ireland, believes the combination of a resurgent Irish economy and the availability of quality assets has seen strong investor interest in the country by international firms – including those from Asia – many of which are new entrants to the market.
“The performance of the Irish retail investment market has been influenced by the economy – the best performing in the eurozone for the last three years – along with significant population growth, and marked improvements in employment levels,” said Moran. “The lack of new supply to the market since 2008 has seen very low vacancy levels across high streets, shopping centers and retail parks, with strong competition between operators for space.”