In the frenzy to buy up land around the golden triangle marked out by Pembroke Road, Shelbourne Road and Landsdowne Road in Ballsbridge, no deal was as costly as the purchase of Hume House in 2005 by NAMA-bound developer Sean Dunne and his Mountbrook company. The owners of Hume House at the time, Irish Life, swapped their building on 0.66 acres of land for new office accommodation in Dublin’s Docklands. Hume House was valued at €130m in the swap, though Sean Dunne subsequently sued CB Richard Ellis claiming that the valuation should have been in the €65-95m range. At €130m for 0.66 acres, that worked out at €197m an acre, a record even amongst the spate of high value deals in Ballsbridge at the time, as shown in the table below.
And today we hear that Sean Dunne has had planning permission approval to develop Hume House. The development doesn’t have an announced name yet but the “Y Building” might be a suggestion as that is what the 16,000 sq metres of office space over 3,000 sq metres of basement will resemble at road level. The planning application has had troubled progress with objectors claiming that Sean only wanted the permission to increase the value of the site to NAMA. Indeed, although Sean is reportedly NAMA-bound, it is unclear whether loans for the Hume building are from NAMA banks as Sean has in the past used non-NAMA banks. It has been noted that 25% of office space in the capital currently lies empty and Sean has not confirmed whether the development will proceed which would have made this a very tricky asset to value.
UPDATE: 9th August, 2010. More good news for Sean Dunne as the Independent reports that land adjacent to Hume House – the site of the Jurys/Berkeley Court hotels also owned by Sean Dunne – has been granted planning permission for “568 apartments and a 135-bedroom hotel” together with a “15-storey tower, with shops, restaurants, bars, healthcare facilities and a creche”. The permission comes with 28 conditions and the Independent suggests there may be appeals.
UPDATE: 14th February, 2011. A setback for Sean Dunne with news at the end of last week that An Bord Pleanala (the national authority for determining building permit issues) has overturned a decision by Dublin City Council which had approved the development of the site of former AIB HQ. The future for the 3.25 acre site bought by Sean in 2006 for €200m is now uncertain with Sean’s planning representative saying that the future is now in Sean’s hands. What is the €200m site worth today? Possibly around €50m if the site has suffered a representative decline in development property prices.
UPDATE: 19th September, 2011. An Bord Pleanala has finally approved a scheme for the Jurys/Berkeley Court hotels site. The plans allow the construction of 11 towers which will house 490 residential units, an hotel and retail. The Sunday Business Post reports that the equity in the scheme is now owned entirely by the lenders, Ulster Bank, ACC Bank and Kaupthing Singer & Friedlander. It is claimed that if the project reaches a value of €220-250m, then Sean will be released from his personal guarantee obligations with these lenders.