Colony Bets on Brexit Boost for Dublin With $1.2 Billion Project
(Bloomberg) -- A Colony NorthStar Inc. venture will develop a Dublin real estate project valued at 1 billion euros ($1.2 billion) as it seeks to take advantage of increased demand for Irish office space after the Brexit vote.
The New York-based real estate investor, whose chairman is billionaire Tom Barrack, will develop four office buildings at Spencer Place in the city’s docklands, Managing Director Stefan Jaeger said in an interview. The venture with Irish developer Johnny Ronan will also develop a hotel, stores and homes on the plot, with the first properties due for completion in 2020.
“Even if you have very minor Brexit moves of 500 or 1,000 people from individual banks, that has a huge impact in Dublin because there currently is a shortage of space,” Jaeger said. “Dublin will be a major beneficiary and this development is in a prime position to take advantage of that.”
Demand from technology, public sector and financial firms has led to a lack of empty properties in the Irish capital, where construction came to a halt after the country’s property bubble burst. Dublin’s docklands district has an office vacancy rate of less than 1 percent, Jaeger said. That compares with 4.7 percent for the city center, according to broker Jones Lang LaSalle Inc.
JPMorgan Chase & Co. acquired an office building on the opposite side of the river from Spencer Place earlier this year and Facebook Inc. and Alphabet Inc.’s Google have also been expanding in the district. Other occupiers in the area include the nation’s central bank and Citigroup Inc.
“We can also deliver housing in the second phase” of the project “which is very attractive for any Brexit occupier that might think about moving” because the city also has a shortage of homes, Jaeger said.
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