Development work on the Spencer Dock site in the Dublin docklands is set to move ahead rapidly following agreement on a €300 million financing package. Jack Fagan reports.
Anglo Irish Bank will provide half the funding to the Treasury Holdings-led consortium for the mixed apartment and office project, with the balance coming equally from AIB and Bank of Ireland.
It will be the largest and most ambitious urban development in the State's history, with an expected capital value of €3 billion.
The funding will cover the cost of providing a new headquarters building of 18,580 sq m (200,000 sq ft) to be leased to accountants PricewaterhouseCoopers (PwC) and 767 apartments in the first phase of the residential element.
Treasury subsidiary Spencer Dock Development Company is developing a mix of commercial and residential property on the 51-acre site, strategically located between the IFSC and the Point Depot.
Ultimately, the €2 billion development will comprise 3,000 apartments, and more than three million square feet of office space and shopping and leisure facilities over the next decade.
The €300 million is the second-largest fundraising for a property development in the State after Dundrum Town Centre, now being completed by Castlethorn Developments.
Treasury Holdings spokesman Mr John Bruder said last night that the agreement with the banks covered both the construction phase and a long-term loan facility. Once PwC moves into its new headquarters, the borrowings will be converted into a long-term investment loan.
PwC will pay rent of around €10.5 million a year, equating to more than €46 per sq ft, although the deal is likely to include a high-spec fit-out and a rent-free period of up to two years.
Treasury will also have to take responsibility for PwC's existing leases on 6,968 sq m of space at Wilton Place in Dublin and 4,181 sq m at the city's George's Quay, which have a considerable number of years to run.
The Treasury consortium is controlled by the principals of Treasury Holdings, Mr John Ronan and Mr Richard Barrett. Businessman Mr Harry Crosbie and U2 accountant Mr Trevor Bowen are also directors.
The group has spent around €30 million since last March on site works at Spencer Dock.
Treasury and construction company John Sisk & Son have already set up a joint-venture company, Construction Management Partnership, to handle the construction.
Spencer Dock Development agreed with CIÉ in 1998 to develop the site, most of which was originally owned by CIÉ. The agreement will see CIÉ receive 17.5 per cent of the rents realised on the site.
The deal has come in for criticism from politicians. However, CIÉ has consistently defended it as the best way to achieve the highest value for the site.
