Irish property target of €9bn foreign fund

jetski

Sunday June 15 2008
ONE of the world's most powerful private equity firms, the $80bn Carlyle Group, has confirmed that it is looking at buying distressed property assets in Ireland as prices continue to tumble.
Carlyle, which has included former US president George Bush, British prime minister John Major and Manchester City owner and former Thai prime minister Thaksin Shinawatra as advisors, has put together Europe's largest real estate fund, after raising €2.2bn from investors. With debt, the fund will have enough firepower to spend €9bn on properties.
"We will definitely consider opportunities in all European markets including Ireland, providing they fit with our investment criteria and there is a clear opportunity for us to create value," Carlyle's UK managing director and head of European Investment Robert Hodges told the Sunday Independent.
"Like the UK and Spain, Ireland has seen a more severe correction than the rest of Europe as a result of the credit crunch," Hodges added.
"We believe that in these markets, sellers' expectations will soon align to the prices that buyers are prepared to pay and that a fund of the scale of ours will be in a good position to find attractive investment opportunities which might not have been available a year ago."
The Irish property market has been in freefall in recent months, with residential prices down nine per cent this year alone. Davy Stockbrokers has forecast falls of up to 20 per cent in the commercial property market, with retail especially hard hit.
Forced sales of assets by hard-pressed developers are widely expected. However, one well-placed financial source said some banks are waiting until the first quarter of 2009 before forcing troubled developers to sell assets.
Sovereign wealth funds, such as those owned by oil-rich gulf states have also been eyeing up Irish investments.
One property source suggested that a number of these groups had been linked with a move for a 50 per cent stake in Liffey Valley shopping centre, which is being sold for up to €400m by Grosvenor and Morley Fund Management.
AIB Capital Markets is said to have secured a major cash injection from at least one gulf state sovereign wealth fund, fuelling its lending book.
AIB said it does not disclose details of its funding. Dubai International Capital and the Abu Dhabi Investment Authority did not respond to queries last week.
The uncertainty in the stock market may lead to blue chip assets being sold at knock down prices to cash rich players such as private equity groups. "There are a lot of transactions and companies on the block at the moment. We're seeing far more private equity players coming over from London to sniff around," said one top corporate banker.
Alchemy, Capvest, TPG and Cinven are all said to have increased attention on the Irish market. Last week, Irish private equity firm TVC indicated it was looking to buy stakes in mid cap public companies.
"I'm surprised that one of them hasn't taken a slug out of one of the banks," claimed one market source.
Texas Pacific Group, run by private equity mogul and Ryanair director David Bonderman, recently took a 23 per cent stake in troubled British lender Bradford & Bingley. The group was linked with Bank of Ireland recently.
A spokesman for Texas Pacific Group declined to comment last week.
- Nick Webb


http://www.independent.ie/business/irish/irish-property-target-of-83649bn-foreign-fund-1410408.html

stovelid

Your font is impossible to read in a dark skin like Cloud, Jetski.

jetski

i tried changing it, is that any good?

Glenbhoy

That is an attrocious article, the headline bears virtually no relationship to the content.

"We will definitely consider opportunities in all European markets including Ireland, providing they fit with our investment criteria and there is a clear opportunity for us to create value," Carlyle's UK managing director and head of European Investment Robert Hodges told the Sunday Independent.

This quote (and it's one of the very few actual quotes in the article) certainly doesn't inspire me to believe that Carlyle are about to start buying up apartments in Ongar or Carrick on Shannon.

the_syco

For us who have Cloud:

jetski wrote: »

Sunday June 15 2008
ONE of the world's most powerful private equity firms, the $80bn Carlyle Group, has confirmed that it is looking at buying distressed property assets in Ireland as prices continue to tumble.
Carlyle, which has included former US president George Bush, British prime minister John Major and Manchester City owner and former Thai prime minister Thaksin Shinawatra as advisors, has put together Europe's largest real estate fund, after raising €2.2bn from investors. With debt, the fund will have enough firepower to spend €9bn on properties.
"We will definitely consider opportunities in all European markets including Ireland, providing they fit with our investment criteria and there is a clear opportunity for us to create value," Carlyle's UK managing director and head of European Investment Robert Hodges told the Sunday Independent.
"Like the UK and Spain, Ireland has seen a more severe correction than the rest of Europe as a result of the credit crunch," Hodges added.
"We believe that in these markets, sellers' expectations will soon align to the prices that buyers are prepared to pay and that a fund of the scale of ours will be in a good position to find attractive investment opportunities which might not have been available a year ago."
The Irish property market has been in freefall in recent months, with residential prices down nine per cent this year alone. Davy Stockbrokers has forecast falls of up to 20 per cent in the commercial property market, with retail especially hard hit.
Forced sales of assets by hard-pressed developers are widely expected. However, one well-placed financial source said some banks are waiting until the first quarter of 2009 before forcing troubled developers to sell assets.
Sovereign wealth funds, such as those owned by oil-rich gulf states have also been eyeing up Irish investments.
One property source suggested that a number of these groups had been linked with a move for a 50 per cent stake in Liffey Valley shopping centre, which is being sold for up to €400m by Grosvenor and Morley Fund Management.
AIB Capital Markets is said to have secured a major cash injection from at least one gulf state sovereign wealth fund, fuelling its lending book.
AIB said it does not disclose details of its funding. Dubai International Capital and the Abu Dhabi Investment Authority did not respond to queries last week.
The uncertainty in the stock market may lead to blue chip assets being sold at knock down prices to cash rich players such as private equity groups. "There are a lot of transactions and companies on the block at the moment. We're seeing far more private equity players coming over from London to sniff around," said one top corporate banker.
Alchemy, Capvest, TPG and Cinven are all said to have increased attention on the Irish market. Last week, Irish private equity firm TVC indicated it was looking to buy stakes in mid cap public companies.
"I'm surprised that one of them hasn't taken a slug out of one of the banks," claimed one market source.
Texas Pacific Group, run by private equity mogul and Ryanair director David Bonderman, recently took a 23 per cent stake in troubled British lender Bradford & Bingley. The group was linked with Bank of Ireland recently.
A spokesman for Texas Pacific Group declined to comment last week.
- Nick Webb


http://www.independent.ie/business/irish/irish-property-target-of-83649bn-foreign-fund-1410408.html

ronbyrne2005

Bullsh1t article and two weeks old too. If commercial property crashes and yields are attractive and achievable then private equity and foreign soverign wealth funds MAY consider investing here but why have none invested here uo to this point? Almost all Irish commercial property is owned by Irish companies/funds/individuals.

SimpleSam06

ronbyrne2005 wrote: »

If commercial property crashes and yields are attractive and achievable then private equity and foreign soverign wealth funds MAY consider investing here but why have none invested here uo to this point?

My guess is they are counting on some sort of an overshoot in the price crashes, and can snap up properties when they bottom out, before stabilising a good bit higher than the bottom. Offload them then and make a profit. The amount of that that will be winging its way towards Ireland however is probably miniscule, low single figure percentage, as they are focusing on a pan-European operation.

What do you bet the government will be offering tax incentives for groups like this to come over and "invest"? :rolleyes:

jetski

Listen onbyrne2005, dont start moaning at me..... i posted it, if you dont like it dont read it and definitly dont start moaning about it...... :mad:


Maybe you missed the line "buying distressed property assets in Ireland as prices continue to tumble."

Glenbhoy

jetski wrote: »

Listen onbyrne2005, dont start moaning at me..... i posted it, if you dont like it dont read it and definitly dont start moaning about it...... :mad:


Maybe you missed the line "buying distressed property assets in Ireland as prices continue to tumble."

Maybe you want to go back and re-read the article, that line you're quoting is a journalist's interpretation (sometimes referred to as spin) of what the Carlyle guy actually said, my own interpretation is somewhat different.

SkepticOne

Real tabloid style journalism. A better title would be "Property fund does not rule out possibility of purchasing in Ireland at some point in the future but has no plans at present".

jetski

actually im perfectly happy with the title, if a title bothers you or anyone else i couldnt care less.... its a title, get over it

johnnyskeleton

The part about forced sales starting in Q1 2009 is interesting, if true.