A newly established Irish property investment company named Green Reit has announced its intention to seek stock exchange listings in Dublin and London.
The company said the placing of shares could help it to raise some €200 million and that it expects trading in its shares to begin on July 18th. It is seeking a primary listing on the Irish Stock Exchange and a premium listing on the London Stock Exchange.
Green Reit says it expects to be the first real estate investment trust (REIT) established in Ireland following the introduction of legislation covering the area by the Government earlier this year.
REITs provide a similar structure for investment in real estate as funds provide for investment in shares. REITs are quoted companies that own or operate property, such as office blocks and shopping centres, and are now the primary way of listing commercial property around the globe.
REITs enable investors to indirectly access the residential and commercial property markets, by buying shares in property companies, which are either listed on a stock exchange or sold privately.
‘’By establishing the company during the current cyclical weakness in the Irish real estate market, the board believes the company will give shareholders the opportunity to take advantage of the re-pricing of asses that has occurred within the company’s target categories of investment opportunities,’’ the company said in a statement.
Green Reit said its objective was to assemble a "portfolio of freehold and long leasehold properties consisting primarily of commercial property in Ireland, principally Dublin". It may also invest opportunities in other urban areas such as Limerick, Galway and Cork.
The company is to be chaired by Gary Kennedy, who is the current chairman of Greencore Group and a director of drug-maker Elan. Other directors include Stephen Vernon, Jerome Kennedy and Thom Wernink.
Mr Kennedy said Green Reit intended to build a portfolio of assets which should deliver a sustainable income stream and, over time, strong capital returns for shareholders.
The company plans to distribute 85 per cent of its property income to shareholders annually, in line with the requirements of the Irish REIT legislation, and it is targeting a total shareholder return of 10 to 15 per cent per annum before tax when fully invested.
Minister fo Finance Michael Noonan welcomed the development and said REITs “will provide stable, long-term capital investment into the commercial property sector in Ireland”.
“The establishment of Green Reit and the rising level of activity and interest in the commercial property market is a further indication that the range of initiatives this Government has introduced are contributing to the stabilisation and recovery of the property sector in Ireland.”
