US private equity group Lone Star is lining up Dres Properties, a homebuilder incorporated late last year, to take on a prime 73-acre residential development site at Cherrywood in south Dublin that it is in advanced talks to acquire.
The Irish Times reported last week that Lone Star had emerged as the leading bidder for the land which was being sold by Hines and King Street Capital. It equates to almost a fifth of the 412-acre site that the two US firms bought in 2014 for €270 million.
It has since been established that the site being sold, which would be capable of delivering 2,600 homes, will be rolled into Dres Properties, which was set up last September by Lone Star and Patrick Durkan, former managing partner of Durkan Residential.
Dres, which is understood to already control a landbank that should be able to deliver 6,400 houses and apartments, had been preparing to raise more than €300 million in an initial public offering (IPO) late last year. Market sources said at the time that Lone Star would retain a significant stake in the business after a stock market flotation.
However, the promoters of the deal decided to stall the IPO after equity markets tumbled in October.
Two key sites in Co Dublin – at Adamstown, near Lucan, and Portmarnock – account for the bulk of Dres's current plots. These were rolled into the company by Lone Star, which had been among the most active buyers of Irish property-related assets in the wake of the crash.
Dres began marketing the first phase of its Dun Si development in Portmarnock as well as an initial phase of its Newpark project in Adamstown this month.
Hines and King Street put the 73-acre Cherrywood site on the market last autumn to recycle cash committed to the wider project, which is on track to deliver a new town at the interchange of the M50 motorway and N11 in south Dublin that will comprise more than 7,700 new homes as well as shops, cafes, parks and leisure facilities.
In early 2016, the partners sold two lots in Cherrywood to Cairn Homes, while, in January 2018, they sold eight office blocks at the business park on the site to San Francisco-based Spear Street Capital for €145 million.
Last year, Hines, in partnership with Dún Laoghaire-Rathdown County Council, completed the construction of the first phase of the project, comprising three new parks, sports facilities and 5.4km of roadways.
