Deutsche Finance International makes first Ireland investment

Deutsche Finance International (DFI), the London based pan-European private equity real estate investor specialising in operational real estate, has broken into Ireland’s property market.

As first reported by sister magazine EuroProperty, DFI has struck a joint venture with BCP Capital to acquire the Central Hotel and Trinity Street Car Park in prime central Dublin, in an off-market transaction for an undisclosed amount. It came with a price tag of around €40 mln when originally put on the market at the end of last year via Cushman & Wakefield when a tender was contemplated.

The investment follows the recent close of DFI’s European Value-Add Fund with €436 mln of equity including co-investment.

The Central Hotel is located on Exchequer Street, off Grafton Street, one of Dublin’s principal retail destinations and comprises 70 rooms over four floors with additional retail plus food & beverage units on the ground floor. The JV intends to undertake a capital expenditure programme to refurbish the hotel, add rooms and improve the F&B offering, allowing it to benefit from the Irish capital’s growing levels of tourism and business travel, which are driving high demand for good quality hotel accommodation in a market that remains undersupplied. Windward Management, one of Ireland’s leading hotel management companies, has been brought in as the hotel operator.

Trinity Street Car Park, which is walking distance from the Central Hotel, comprises 171 car-parking spaces with ancillary retail and office use over five floors. The JV plans to enhance the asset’s income through the activation of potential alternative uses within the property, which sits in the tourism and leisure heart of the city.

Paul Nearchou, director at DFI, said, ‘These are our first investments for the fund in Ireland, allowing us to create value in prime locations and benefit from highly supportive structural trends, including an undersupplied commercial real estate market; strong GDP growth; and high levels of foreign direct investment.’

Gavin Neilan, co-founder and co-managing partner at DFI added: ‘Following the recent close of our €436 mln inaugural fund, we are in a strong position to take advantage of the opportunities we see in markets across Europe, such as this one.’

Nick Cullen, CEO at BCP Capital, said DFI was quickly establishing itself as a significant player in value-add real estate investment. ‘By leveraging our expertise of the Dublin market, along with DFI’s experience in operational real estate, these initial investments are expected to deliver significant returns through an active asset management programme, while capitalising on a city exposed to growth driven by structural factors.’

DFI has over €1 bn of assets under management and is independently managed by its founding partners yet still part of the Deutsche Finance Group, a global investment management firm that specialises in private market real estate and infrastructure investments. DFG has over €4 bn AUM and is headquartered in Munich with offices in London, Denver, Zurich and Luxembourg.

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