Acquisition & Increased Credit Facility
13 June 2019
This announcement as it relates to the property portfolio acquisition contains inside information regarding Irish Residential Properties REIT plc for the purpose of the Market Abuse Regulation (Regulation (EU) No 596/2014)
I•RES to Acquire 815 Residential Units for €285 million and Increases its Credit Facility
I•RES Intends to Acquire XVI Portfolio Totalling 815 Residential Units for €285 million
Irish Residential Properties REIT plc ("I•RES" or the "Company") announces today that the board of directors of the Company has approved the acquisition of a property portfolio (the "XVI Portfolio"), comprising of 815 residential units across 16 high-quality developments, from Bryant Park QIAIF ICAV (the "Vendor"), acting for and on behalf of MAV I Fund, for a total purchase price of €285 million (including VAT but excluding other transaction costs) (the "Marathon Acquisition"). I•RES expects to exchange contracts on or before 14 June 2019 and, subject to the satisfaction of certain conditions (including the approval of the Competition and Consumer Protection Commission in Ireland), the acquisition is expected to complete during August 2019.
Fifteen of the developments included in the XVI Portfolio are located in Dublin, comprising of 765 residential units in total (representing 94% of the portfolio) and one scheme is located in Cork, comprising of 50 residential units (representing 6% of the portfolio). The XVI Portfolio assets present an excellent mix of locations which complement the existing I•RES portfolio with a number of the XVI Portfolio developments being located close to existing I•RES assets and others located in excellent locations where I•RES will now establish a market presence. The XVI Portfolio assets are situated in a mix of both city-centre and prime suburbs and are all located in established residential areas close to quality infrastructure including schools, transport, employment and amenities.
The residential units in the XVI Portfolio to be acquired comprise a mix of 138 one-bedroom (17%), 599 two-bedroom (73%), 77 three-bedroom (10%) and 1 four-bedroom (<1%) apartment and duplex units and associated car parking. 797 (98%) of the residential units are currently leased and income producing with the remaining 18 residential units available for immediate lease up by I•RES.
The XVI Portfolio currently generates an annualised gross rental income of €14.2 million (or €1,486 on average per occupied unit per calendar month). Based on the current estimated market rental value, the XVI Portfolio is estimated to be reversionary by approximately 21%. All of the XVI Portfolio assets are located in Rent Pressure Zones and subject to a maximum rental uplift of 4% per annum. Based on current annualised passing rents and the lease up of the remaining 18 residential units, the XVI Portfolio generates an initial gross yield of approximately 5.1% growing to approximately 5.5% by year 3 and an estimated reversionary yield of approximately 6.2% based on current estimate market rental value. The Marathon Acquisition is expected to be accretive to earnings in the first full year post acquisition.
The XVI Portfolio includes residential units in the following schemes:
|
|
No. of Units |
|
Carrington Park, Santry, Dublin 9 |
142 |
|
Beechwood Court, Stillorgan, Co Dublin |
101 |
|
Northern Cross, Malahide Road, Dublin 13 |
128 |
|
Richmond Gardens, Richmond Avenue, Dublin 3 |
98 |
|
Time Place, Sandyford |
67 |
|
Xavier Court, Dublin 1 |
41 |
|
Harty's Quay, Rochestown Road, Cork |
50 |
|
Heywood Court, Santry, Dublin 9 |
39 |
|
Belville Court, Cabinteely, Dublin 18 |
29 |
|
Belleville & The Mills, Castleknock, Dublin 15 |
21 |
|
St Edmunds, Palmerstown, Dublin 20 |
18 |
|
Russell Court, Swords, Co Dublin |
29 |
|
Spencer House, IFSC, North Docks, Dublin 1 |
12 |
|
East Arran Street, Smithfield, Dublin 7 |
12 |
|
The Oaks, Clonsilla, Dublin 15 |
14 |
|
Coopers Court, Dublin 8 |
14 |
|
Total |
815 |
I•RES Increases its Revolving Credit Facility
The Company also announces that, further to the Company's announcement on 18 April 2019, the Company has exercised its option under the Company's revolving and accordion credit facility to extend its committed facilities from €450 million to €600 million and has amended the credit facility to include a new uncommitted accordion facility in the amount of €50 million (the "Increased Credit Facility").
Under the Increased Credit Facility, Barclays Bank Ireland PLC is mandated lead arranger, lender, facility co-ordinator and security trustee, Allied Irish Banks, p.l.c., HSBC Bank PLC, The Governor and Company of the Bank of Ireland and Ulster Bank Ireland DAC are mandated lead arrangers and lenders and Barclays Bank PLC is the agent.
It is intended that funds from the Company's Increased Credit Facility will be utilised for the Marathon Acquisition.
Margaret Sweeney, Chief Executive Officer of I•RES commented:
"The acquisition of the XVI Portfolio presents an unrivaled and highly attractive opportunity to invest in a diversified residential portfolio of scale which is immediately income producing. The location and quality of the assets complement the existing I•RES portfolio remarkably well and offer operational synergies in many locations, whilst also opening up new areas of Dublin city where I•RES has been seeking representation. The acquisition underlines the Company's strategy for growth and its long term commitment to the Irish market and will on completion bring the I•RES residential unit count to 3,568 residential units with a further 316 residential units due for delivery between now and 2021 under pre-purchase contracts."
For further information please contact:
For Investor Relations:
Irish Residential Properties REIT plc
Margaret Sweeney, Chief Executive Officer
+ 353 (0) 1 557 0974
For Media Requests:
Q4PR
Gerry O'Sullivan
+ 353 87 2597644
About Irish Residential Properties REIT plc
Irish Residential Properties REIT plc, is a leading Irish Real Estate Investment Trust ("REIT") listed on Euronext Dublin. The Company is the first REIT established in Ireland primarily focused on residential rental accommodations. The Company will continue to seek to acquire, hold, manage and develop investments primarily focused on residential rental accommodations in Ireland. The Company currently owns 2,753 residential units with an additional 316 units due for delivery between now and 2021 under pre-purchase contracts. Further information in respect of the Company can be obtained from the Company's website at www.iresreit.ie.
Note on forward-looking information
This note applies if and to the extent that there are forward-looking statements in this Announcement.
This Announcement may contain forward-looking statements, which are subject to risks and uncertainties because they relate to expectations, beliefs, projections, future plans and strategies, anticipated events or trends, and similar expressions concerning matters that are not historical facts. Such forward-looking statements involve known and unknown risks, uncertainties and other factors, which may cause the actual results, performance or achievements of the Company or the industry in which it operates, to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. The forward-looking statements referred to in this paragraph speak only as at the date of this Announcement. The Company will not undertake any obligation to release publicly any revision or updates to these forward-looking statements to reflect future events, circumstances, unanticipated events, new information or otherwise except as required by law or by any appropriate regulatory authority.
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