Growth in Ireland’s property market remains “significantly ahead” of the rest of Europe, according to the European arm of US investment giant Starwood Capital.
The European division said Dublin features low vacancy rates in prime offices, hotels that have the top occupancy rates of all cities in Europe, and a shortage of residential and student accommodation.
Starwood European Real Estate has just over 23pc of its total £431m (€503m) loan portfolio in Ireland. Its total investments and commitments at the end of 2018 were £477.2m (€559m).
It bankrolled the development of the new international school in south Dublin, a project spearheaded by tech entrepreneur Barry O’Callaghan in conjunction with Hong Kong-based Nord Anglia Education.
The school, located at the former Microsoft European headquarters, opened last September. Starwood loaned £17m towards its development.
Releasing its annual report yesterday, Starwood European Real Estate confirmed that it closed a €60m floating rate whole loan to finance the acquisition of stake in the Citywest hotel in Dublin by Tetrarch Capital in February last year. It was one of the largest loans made by Starwood’s European arm last year.
Tetrarch bought out the interest of its joint-venture partner in the hotel, US firm Pimco. The pair had acquired Citywest out of receivership in 2014 for €30m.
Starwood also loaned €9m to finance the conversion of 84 aparthotel units to residential use on a site adjacent to the Citywest hotel. The financing was made via an initial advance along with a capital expenditure facility to fund the refurbishment works for a period of 18 months, with a six-month extension option.
The company also committed to an €11.25m loan facility to finance the development of a 127-bedroom student accommodation scheme in the capital.
“The Dublin student market suffers from a severe structural undersupply of purpose-built student accommodation, and the borrower’s aim is to deliver high-quality schemes in strong locations across Ireland in order to address this shortage,” noted Starwood.