28 Nov 2019

Cairn Homes: Announces a sale and acquisition

Cairn Homes has this morning announced the forward sale of 150 units in Maynooth for €53.5m and the acquisition of 97 acres of development land at Clonburris in west Dublin.

Cairn has agreed the forward sale of 150 PRS units, comprising apartments, duplexes and houses, at its Mariavilla development in Maynooth to Urbeo, a domestic provider of affordable rental properties. Cairn is developing 380 units across two plots at present at Mariavila and these units will be delivered on a phased basis from next month. The first phase of 80 build-to-sell units at Mariavilla were well received by prospective purchasers with the next phase to be launched next Spring, but the PRS sale route provides another avenue to securing sales across a number of Cairn’s sites given the strong demand from investors in this area.

Cairn has also acquired 97 acres of development land at Clonburris Strategic Development Zone (SDZ) in west Dublin. This €21.5m acquisition is by way of two separate transactions from vendors NAMA and O'Callaghan Properties, and adds to Cairn’s existing holding of 174 acres at Clonburris SDZ. We had previously expected Cairn to ultimately deliver more than 3,000 units at the site but its release this morning notes that the acquisition will allow it provide over 5,000 new homes at the site. We expect that Cairn’s units at Clonburris will, by virtue of its low cost land acquisition at the early stage of the market recovery and its scale efficiencies, be amongst the most keenly priced new-build homes in Dublin when they come to market. 

YouGov MRP poll

Last night, YouGov released its MRP (multilevel regression and post-stratification) poll which uses a large (100k) sample to model voting intentions using factors such as socio-economic characteristics and pro ‘leave’ and ‘remain’ attitudes. This allows the pollster to predict not just voting shares for each party, but individual seat results as well. 


YouGov calculates that the Tories would get an overall majority of 68. In short, the party is reckoned to be on course to lose relatively few seats in London and the south, to keep 11 of its 13 MPs in Scotland and to win long standing Labour seats in ‘leave’ voting areas such as Bolsover, Ashfield and Rother Valley. In terms of voting shares, the Conservatives are 11 points ahead of Labour. YouGov calculates that the Tory majority is eroded at somewhere close to 7 points. Our model, using a Uniform National Swing on these voting shares implies a Tory majority of 65, almost identical to the MRP results. 

The reinforcement of the likelihood of a Conservative win has pushed sterling up overnight – it is now trading at $1.2940, not far off a cent higher than yesterday afternoon.

Eurozone inflation under review

Markets are paying more attention to Eurozone inflation ahead of tomorrow’s flash data release for November, as incoming ECB president Christine Lagarde, announces the review of the 2% inflation target.  Core Inflation in the Eurozone has averaged just below 1% for the past 5 years, well below its target of “close to but below 2%”, this has been despite consistent long-term forecasts from the ECB which have forecasted inflation to rise towards its goal. Part of the problem has been that the traditional relationship between unemployment and inflation (known as the Philips curve) has broken down in developed economies, but other factors such as improving technology, and falls in global demand and commodity prices have also been blamed. 

Some analysts have suggested removing the asymmetry of the current target (which lead to premature rate hike decisions in 2008 and 2011), while others have called for a lower target (provided employment remains strong) which would remove the need for current levels of stimulus. However, the latter raises the concern of insufficient buffer against future shocks, while the former would not be a major departure from how Draghi interpreted his policy goal.  


Chief economist Philip Lane warned yesterday against expecting too much from the review, however given how significant the outcome could be in driving ECB policy decision, the potential impact for the Euro could be huge.

Economic Releases

EU 09.00 M3 Money Supply

EU 10.00 Consumer confidence

GE 13.00 HICP & CPI