Brexit

21 Aug 2019

Irish REITs – Patrizia to acquire 72-unit complex in €52.5m PRS deal

German property fund Patrizia AG has added another significant Dublin residential property development to its growing Irish portfolio.

According to the Irish Times, the property company has agreed to pay €52.5m for a 72-unit apartment complex under development in the Dublin Docklands. 


The Irish Times reports that Patrizia has agreed to acquire the Benson Building from a development consortium (Targeted Investment Opportunities) which includes Oaktree and NAMA which is building a large office and residential scheme at 76 Sir John Rogerson’s Quay. The apartment units being acquired by Patrizia sit in an 11-storey-over-basement building expected for completion in 2020, and which is likely to generate a rental value of c.€2.9m upon completion, according to selling agents Savills and Owen Reilly. 


The deal represents another significant PRS deal for the Dublin property market and shows the keen interest which foreign investors continue to have for the segment, despite the recent signs of a slowdown in residential property price growth. Patrizia last month agreed to pay €93m for a 166-unit apartment complex being developed in Dublin’s Harold’s Cross area by Marlet Property.


Boris bound for Berlin & Paris

UK PM, Boris Johnson, is set to embark on his first foreign trip today as Prime Minister, as he seeks to persuade EU leaders to reopen the Withdrawal Agreement (WA). He is set to meet with German Chancellor Angela Merkel over a working dinner this evening along with his chief Brexit negotiator David Frost. Prior to this, the two leaders are set to make short statements and take questions from around 5:30pm London time. 


He is then set to travel to Paris tomorrow, to meet with French President Emmanuel Macron ahead of the G7 Leaders’ Summit in Biarritz that begins on Saturday. The key sticking point remains the Irish backstop, which Mr Johnson insists must be extricated from the WA. The EU argues that there is currently no “realistic alternatives” to avoid a hard border in Ireland, with Ms Merkel yesterday pledging to think about “practical solutions”. She did however note that this would not require reopening the WA but could be addressed using the so-called political declaration. 


While some intraday volatility persists, there has been no dramatic change in the value of sterling in recent days with the benchmark EUR/GBP rate consistently gravitating towards the 0.9150 level.


Italian PM resigns

Overnight Italian PM, Giuseppe Conte, officially handed in his resignation, rather than face a confidence vote. Where the political situation goes from here is uncertain, but essentially, it will be determined by President Mattarella.


Several options are possible but the first step will be formal consultations between the President and the various Italian political parties to investigate the possibility of a new coalition government (no one party has sufficient seats to secure a majority alone) or alternatively a government of national unity as was seen in 2011, headed by Mario Monti. President Mattarella will begin those discussions today, meeting with the heads of the Senate and the Chamber of Deputies (lower house). 


Those discussions will be followed by talks with the main parties tomorrow (Lega, 5*, PD). Should it become apparent that any grouping of parties or a unity government cannot be found then the President is likely to call an early election, the date most widely discussed being the end of October - not ideal for the UK if their Brexit talks occur at that time.


Economic Releases

09.30  UK   PSNB

15.00  US   Existing home sales

19.00  US   FOMC minutes