Building higher could cut prices by 20%, says Cairn chief

The head of one of Ireland’s biggest homebuilders has said the cost of apartments in Dublin could be lowered by about 20 per cent if they were allowed to construct residential blocks of up to nine storeys in the city centre.

Speaking to The Irish Times podcast Inside Business, Cairn Homes chief executive Michael Stanley said: "If you can go from six to nine floors you can make much better use of your land. You've just added 30 per cent more space on the same site."

Cairn is currently building 122 high-spec apartments over seven storeys at 6 Hanover Quay in the Grand Canal Docks in Dublin. The listed company plans to bring these properties to market in the summer, at an average price of more than €600,000.

Mr Stanley said he would have liked to increase the height to nine storeys, which could have shaved €120,000 off the average cost per unit.

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“It would have allowed us to bring down the cost of this quite dramatically,” he said.

By how much? “20 per cent. Yes comfortably. The land costs are still the same, the basement costs are still the same [but ] we couldn’t afford to wait another 12 months to see if we could get [extra] height through.”

Cairn is entering its third full year of trading and Mr Stanley predicted that its turnover in 2018 would roughly double to in “excess” of €300 million, giving it the firepower to potentially acquire other sites for apartments in Dublin city.

On its plans for the nine acres it acquired last year from RTÉ at Montrose in Donnybrook for €107 million, Mr Stanley said: "We're probably going to be at least a year in design and planning. We're not rushing that site. It's a special location. I believe that site could turn out to be the best development we ever do.

“It’s an opportunity to bring maybe north of 500 apartments into an area where they’re badly needed. That site will not only provide an opportunity for people to trade down in the Dublin 4 location but it will also provide a location for people working in the city to acquire an apartment as well.”

Formed in 2015, Cairn is listed in Dublin and London and has raised €720 million to date in funding. It built 418 homes in Ireland last year.