22 Aug 2019

IRES REIT – Rockbrook approval for 428-unit development

IRES REIT has this morning announced that it has received planning permission for its proposed 428-unit residential development in Rockbrook in Sandyford.

The company received confirmation from An Bord Pleanala (the Irish Planning Board) on its successful application under the Strategic Housing Development fast-track planning process. 


IRES had previously sought but was refused planning permission for a similar but slightly larger development in 2017. The new application was expected to be received more positively given loosening of planning guidelines in the interim. The planning permission consists of 428 apartment units in two blocks, a crèche, and 4 commercial units, with the development already benefitting from partially completed below-ground infrastructure and car parking. It is also adjacent to IRES’ existing assets in Sandyford Beacon South Quarter. 


IRES now has the Rockbrook development and a further 200 units of approved planning permissions elsewhere in the portfolio. For reference, the 628 units of planning approval that IRES now holds would add approximately 17% to the existing portfolio of 3,607 residential units. 


Good Cop, Bad Cop

UK Prime Minister, Boris Johnson, held talks in Berlin yesterday with German Chancellor, Angela Merkel. A receptive Mrs. Merkel injected some hope that the UK and the EU could find a “solution in the next 30 days” to the Irish backstop, she nevertheless stressed that it was not her responsibility to develop an alternative post-Brexit arrangement for the border. 


Mr Johnson will now head to Paris today to meet with what will probably be a more (than Mrs. Merkel) confrontational Emmanuel Macron at 1:00pm to try and convince one of the EU’s most hard-line leaders to reopen the current Withdrawal Agreement. Ahead of this meeting, Mr Macron has said that removing the backstop is “not an option” and has warned that Mr Johnson’s proposals suggested a choice “between the integrity of the European market and the respect of the Good Friday Agreement. We wouldn’t choose between these two”. Note that the French government has now adopted a no-deal Brexit as its central scenario, though it has said that it would probably accept another Article 50 extension to allow the UK to hold a new general election. 


Meanwhile, Labour leader Jeremy Corbyn has scheduled a cross-party meeting on August 27 to “do everything we can to stop” a no-deal Brexit. Mr Corbyn has invited 10 politicians including Liberal Democrat leader Jo Swinson, the SNP’s Ian Blackford, the Green Party's Caroline Lucas as well as a number of rebel Tory backbenchers.


FOMC minutes

The minutes to the 31 July Federal Reserve policy meeting revealed a committee that was split over the policy decision. The meeting saw the Federal funds target rate range cut by 25bps to 2.00-2.25%, while there were two dissenters who favoured no change in interest rates; Esther George and Eric Rosengren. 


However, the minutes show that there was a much larger debate. This included a couple of members who said they would have preferred an immediate 50bp cut; on the flip side, several members had preferred keeping policy steady. Most Fed officials saw the July cut as ‘mid-cycle adjustment’, a phrase that Chair Powell went on to use during the press conference. 


Other matters discussed during the meeting were the ‘persistent headwinds’ from trade, an issue which witnessed escalation just days later when President Trump announced the intention to introduce an additional 10% tariff on $300bn of Chinese imports. A few officials also expressed some worries over the inversion of the US yield curve. 

 

Overall, the minutes highlight the differing views on the appropriate policy response to greater downside risks and low inflation but also at a time when the US economy is in relatively good health. Indeed, the references to a mid-cycle adjustment and flexibility in the Fed’s policy approach, suggest that the policy outlook is somewhat clouded and it is certainly not a given that the Fed will cut the funds rate by the 100bps or so over the next year which is currently priced into futures markets. 


Finally, since the FOMC meeting almost a month ago, the trade and global situation has evolved, a more up to date view on the economic and policy outlook will likely be provided by Chair Powell tomorrow, when he speaks at the Fed’s Jackson Hole conference at 3pm (UK time).


Economic Releases

09.00  EU   Composite PMI

12.30  EU   ECB minutes 

14.45  US   Manufacturing PMI