The prospects of developing a substantial new economic and residential hub in south Dublin will move a stage further with the forthcoming sale of Cherrywood Business Park and the adjoining development lands.
Savills is to seek in excess of €220 million for the prime 400-acre site which is expected to become the main focal point for new developments over the next decade. The designation of Cherrywood as a Strategic Development Zone (SDZ) will allow fast-track planning for a new town centre surrounded by retail facilities, offices and a large mixture of housing. Experts estimated that the gross development value of the proposed scheme will exceed €2.5 billion.
The sale, codenamed "Project Cherry", is being handled by Savills for Stephen Tennant and Paul McCann of Grant Thornton who were appointed receivers by a consortia of banks led by Danske, Bank of Scotland (Ireland), AIB, as well as Nama.
The park and lands were acquired on an equal basis in 1999 by Dunloe Ewart plc and British Land. In 2002, Dunloe bought out its partner's interests for €70 million and under the direction of Liam Carroll went on to develop eight office and retail buildings extending to 54,238sq m (583,839sq ft).
Like other office parks, development ceased when the property market collapsed in 2007.
The sale will be heavily promoted overseas but particularly in the UK where a range of property companies and investment funds are likely to show interest in what is the most valuable large scale development opportunity in Ireland.
Some of them will obviously look at the prospects of embarking on a joint venture with an Irish development company. UK interest is likely to come from British Land, Delancey, Goodman and Development Securities and funds like Oaktree, Hines, Blackstone, F&C Reit and Pimco. Irish developers likely to consider the project are Green Property, Davy Hickey, Rohan Holdings, Bennett and Neville.
The current rent roll from the office and retail facilities on site is €7.43 million. This is expected to increase to €10.5 million when vacant buildings are let.
The top five tenants on site are Dell (who contribute 30 per cent of the rental income), Friends First (25 per cent), Covidien, Rational FT Services and Elavon.
Under the SDZ master plan, there is scope to build 3,836 residential units along with 484,474sq m (5,214,781sq ft) of commercial buildings. This includes 37,800sq m (406,871sq ft) of retail space.
A total of 26.4 acres have been set aside for a town centre and with Ikea already enquiring about the prospects of opening its second Irish store on site there is considerable confidence that the overall plan will prove viable.
The development potential of the land is underpinned by the expenditure already incurred of about €40 million on the provision of infrastructure in recent years.
The site has a dedicated junction on to the M50 and the N11 – two important roads which provide swift access to all Dublin regions and to the southeast of the country.
There are also a number of bus stops on site as well as three dedicated Luas light rail stations which provide direct access to Dublin city centre is about 40 minutes.
Mark Reynolds of Savills said Cherrywood was larger than London's Hyde Park and represented an unrivalled opportunity to develop a new destination in a much sought after suburb. Its location, transport links and infrastructure meant that it would be a priority location for development over the next 10 to 15 years. "Simply put, no opportunity of this scale is ever likely to be presented again in Dublin."
Domhnaill O’Sullivan of Savills said that with its town centre designation Cherrywood would be the obvious location for the next significant shopping centre in the Dublin area.
