Allsop Space auction in Dublin concludes – results and analysis

[These are the results of the May 2012 Allsop Space auction. Click here for the results of the 6th July 2012 auction]

UPDATED – Lot 4 which sold was later changed to available when the original report was published below, but has now reverted to “sold” ]

The sixth auction held by the Allsop Space joint venture has just concluded in the Shelbourne Hotel in central Dublin. Of the 106 lots that were originally up for grabs, 9 were withdrawn before the auction. Of the remaining 97, 10 went unsold during the auction though several were fractionally off their maximum reserves and may well sell later. In total the 87 lots that were sold had maximum reserves of €10.3m and they sold for a total of €12.9m, or an average of 26.0% over the maximum reserves. Only one lot sold below its maximum reserve and the overall success rate – lots sold as a proportion of lots available for sale – was 89.7%, which comfortably keeps Allsop Space’s place at the top of Irish property auctioning. Here are the flash results from today – click to ENLARGE.

The catalogue is available here (it’s 21mb so might take a few moments to load)

There will be comment and analysis here shortly.

UPDATE: 3rd May, 2012.  Again the venue at the Shelbourne Hotel was packed today. The final tally from Allsop Space shows that €12,974,000 was raised from the sale of 88 properties of the 97 available (a 91% success rate). The presence of Asian/Chinese buyers bidding and buying was observed. Alongside Gary Murphy, a new auctioneer made her debut Daphne Mahon. A Northern Irish developer bought Lot 74, the unfinished estate in Cavan for €122,500 which had a reserve of €40,000. This was a particularly important sale and has implications for the many incomplete estates throughout the country, some of which have already been bulldozed. The 43-bedroom Darby Gills hotel in Killarney was bought by a Cavan bidder for €735,000 well above its reserve of €515,000.  Robert Hoban, Director of Auctions at Allsop Space was pleased with the results which he said remained one of the few transparent means by which price discovery is enabled in the current market. Over 50 properties were auctioned by private sellers and it was noteworthy that one property, 24 Obelisk Rise in Carysfort in Blackrock sold for above the offer price previously available by private tender.

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NAMA sues developer behind €1.5bn scheme in Drogheda

If NAMA continues to rack up legal action at its current rate, it might be an idea to create a new division of the Commercial Court division of the High Court just to accommodate the Agency. Yesterday National Asset Loan Management Limited made an application in Dublin’s High Court, reference 2012/1659 S. The defendants are named as Bill Doyle and Fergus O’Brien and they’re being sued as individuals. NAMA is represented by Dublin solicitors, Whitney Moore who were also selected by NAMA to deal with its case against yacht-racing Limerick developer, Ger O’Rourke and his wife Majella.

Bill Doyle of the Bohan Property Group and Doyle Developments was behind plans for a €1.5bn scheme south of Drogheda where 2,000 homes were to be built as well as a 12,000 seater stadium. According to the Independent, “the developer is believed to have a considerable land bank in the town of Portlaoise and is an owner of the BarringtonTower site in Foxrock”

We don’t yet have details of the current application. In the past, NAMA has taken legal action against individuals to enforce personal guarantees or to secure personal judgments, but it should be stressed that we do not know if either of these objectives lies behind the current application.

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UK residential property up 0.6% in April 2012 (down 0.2% in seasonally adjusted terms)

The Nationwide Building Society has this morning published its UK House Price data for April 2012. The Nationwide tends to be the first of the two UK building societies (the other being the Halifax) to produce house price data each month, it is one of the information sources referenced by NAMA’s Long Term Economic Value Regulation and is the source for the UK Residential key market data at the top of this page.

The Nationwide says that the average price of a UK home is now GBP £164,314 (compared with GBP £163,327 in March 2012 and GBP £162,764 at the end of November 2009 – 30th November, 2009 is the Valuation date chosen by NAMA by reference to which it values the Current Market Values of assets underpinning NAMA loans). Prices in the UK are now 11.7% off the peak of GBP £186,044 in October 2007. Interestingly the average house price at the end of March 2012 being GBP £164,314 (or €199,259 at GBP 1 = EUR 1.22) is 25% above the €159,044 implied by applying the CSO March 2012 index to the PTSB/ESRI peak prices in Ireland. The average home in Northern Ireland in Q4, 2011 was worth €163,510, according to the University of Ulster/Bank of Ireland survey.

With the latest release from Nationwide, UKhouse prices have risen 1.0% since 30th November, 2009, the date chosen by NAMA pursuant to the section 73 of the NAMA Act by reference to which Current Market Values of assets are valued. The NWL Index is now at 818 (because only an estimated 20% of NAMA property in the UK is residential and only 29% of NAMA’s property overall is in the UK, small changes in UK residential have a negligible impact on the index) meaning that average prices of NAMA property must increase by a weighted average of 22.3% for NAMA to breakeven on a gross basis.

According to the UK’s Office for Budget Responsibility which independently monitors and comments on the UK economy, house prices are projected to fall by 0.4% in 2012 before increasing by 0.1% in 2013, 2.5% in 2014 and 4.5% in 2015 and 4.5% also in 2016.  UK inflation remains elevated at an annualized 3.5% in March 2012, and is set to be close to 3% in 2012 – remember that UK inflation has increased by over 15% since their peak whereas in Ireland inflation has been subdued and is one third of that – the UK has pumped GBP0.3tn of “quantitative easing” into its GBP1.5tn economy.UK interest rates may increase later this year to combat inflation – the base rate has been 0.5% since February 2009.The UK economy is projected to grow by an anaemic 0.8% in 2012 in real terms, close to our own Department of Finance’s projection for Ireland at 0.7%.

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