Value of Dunne’s Ballsbridge site may now be less than €100m

HouseBuyer · February 1, 2009, 10:15am

sbpost.ie/post/pages/p/story … qqqx=1.asp

The Jury’s Doyle hotel site in Ballsbridge in Dublin, which property developer Sean Dunne assembled at a cost of €379 million, is now worth less than €100 million, auctioneers have estimated.

Last Friday, Dunne’s company, Mountbrook Homes, was refused planning permission for a high-rise development on the site, which would have included a 37-storey tower. In a statement, the firm said it was ‘‘very disappointed’’ with the decision by An Bord Pleanala and would consider its ruling before submitting a revised plan for the site.

Ulster Bank provided Dunne with most of the financing for the site, believed to be in the region of €270 million, but it is understood the lender syndicated around half of this to other banks. However, experienced auctioneers in some of the country’s largest estate agents, said that the site was now worth between €80 million and €100 million, though exact valuations are difficult in today’s market.

‘‘It is all about the exit values,” said one senior auctioneer, who did not wish to be named. ‘‘If you take the view that new homes [prices] are now back 40 per cent on what they were two years ago, and are predicted to drop another 10 per cent in the next six to nine months, that is a 50 per cent drop on any investment.

Land values drop further than housing unit values, so these are now back 70 to 75 per cent in this case.” Selling the site would also be very difficult in the current environment, according to Duncan Lyster, director of Irish and international investment at Lisney.

‘‘The number of buyers for a site like that - which is probably the best site in Dublin - would be very few. In terms of development of it . . . the climate for raising money is as bad as it’s ever been,” he said.

**The Sunday Business Post understands that a wealthy Irish businessman expressed an interest in the site six months ago, but did not proceed because of the poor economic environment and global credit crunch. **Informed sources also said that the Doyle family of hoteliers, who sold Dunne the site, ‘‘have no intention’’ of buying the site back.

Is that some sort of Sean Dunne, revenge fund or something?

kerrynorth · February 1, 2009, 10:40am

I think you should amend the title to add an ‘m’ for million. I’d buy the site for 100 quid even in these straightened times!!

What_Goes_Up · February 1, 2009, 10:54am

Thing_Fish · February 1, 2009, 11:08am

now for round 3 of “it’s a bailout”

daltonr · February 1, 2009, 11:32am

Yeah, difficult in today’s market.
Like “experienced auctioneers in the large estate agents” were getting valuations spot on during the boom.

I presume an “experienced auctioneer in a large estate agents” was involved in putting the 370m value on it when it was bought.

Plonkers.

-Rd

Bostonorberlin · February 1, 2009, 3:02pm

Good points Rd…

If they are having a difficulty putting a value on it why not ask the expert in the area of Ballsbridge property prices, Gayle Killea…so cmon Gayle give us a figure between 50p and 17 euro 27 cents…

Green_Bear · February 1, 2009, 3:13pm

Yes I remember this controversy at the time, I think they buried the legislation to regulate auctioneers since.

The difference between auction guide prices and eventual sale prices was the source of much controversy last year. Many feel that auction guide prices are being set too low - in some cases far lower than the reserve, which is the lowest price the seller will accept.
The Department of Justice, Equality and Law Reform set up a commission on auctioneering to review all aspects of the profession.
The commission said that it would investigate the phenomenon of “effectively three prices at every auction - the price, the guide and the reserve’‘.
Fox is happy to maintain the status quo when it comes to pre-auction guide prices being 10 per cent under the price the vendor expects to achieve.
“It’s historic. It’s about getting bums on seats, for want of a better phrase. Everyone knows that’s the way it works,” she said.
But she favours the introduction of legislation that would prevent vendors from withdrawing a property at auction once bidding goes 10 per cent higher than the guide.

Fox’s big leap
Sunday, January 02, 2005 - By Susan Mitchell
archives.tcm.ie/businesspost/200 … ry1265.asp

Cooke has been in office throughout the property boom, a golden period when his members drip fed the public with an orgy of misleading guide prices, all published in the newspapers. So in the good times, IAVI members were publicly undervaluing property prices. And getting away with it. Such activity tended to fill the auction rooms. Buyers were suckered into the sales. Enter the bad times. Little has changed. They are still misleading the public, but in the opposite direction.
Last week, Cooke took to the airwaves as even more serious complaints surfaced about his flock. Auctioneers, many of them IAVI members, are still sending misleading prices to be published in the newspapers. And once again, they have got away with it. They have been informing the nation that sale prices achieved behind closed doors were higher than they actually were. Such activity tended to prop up the sagging market. Perhaps we should not be surprised. Auctioneers are not everybody’s first choice for tiger-shooting companions.

Amnesty For The Auctioneers
Published May 6th, 2008 in Consumer Affairs, Regulating Auctioneers
shane-ross.ie/archives/319/a … ctioneers/

theschmuck · February 1, 2009, 3:38pm

Yes, it does sound riciculous, doesn’t it. That he would ask his wife to pick a random number in relation to a business deal of this size and somehow she managed to get one that was marginally above the next highest bid. The odds of her getting such a guess right must be about 50/1. Why start at 253 and not 250? If this anecdote happened as he tells it, he’s an utter moron who should never have been involved with sums of money this large. Or maybe it’s not true and…
I don’t see why auctioneers would be consulted about its value at this stage anyway. This is going to remain a hotel(s) for the next decade at least. What’s its value as a going concern?

nosy_parker · February 2, 2009, 10:00am

A classic case of the winner’s curse
en.wikipedia.org/wiki/Winner%27s_curse

geckko · February 2, 2009, 10:05am

That turned out to be one expensive trophy wife. Yes sirree.

CaveCanem · February 2, 2009, 10:48am

An irksome quirk of property valuations is that they are point in time. All the valuer does is mark the property to market and make a few adjustments. This makes their use very limited. I get the feeling that people assume the valuers are placing some sort of longer term sustainable value to a property.

bungaloid · February 2, 2009, 11:04am

there is no such thing.

economic equilibrium is a fallacy. it will take decades to eradicate this poison from our thought processes.

CaveCanem · February 2, 2009, 11:13am

Talk about being quoted out of context. At least put in the full sentence

El_Stuntman · February 2, 2009, 11:29am

“and the next time I ask you to pick a fucking number, pick the fucking lowest one! Is that a penny I see…”

bungaloid · February 2, 2009, 1:07pm

please excuse me, completely missed context.

maybe because the phrase “long term sustainable” makes all the neurons in my head fire simultaneously.

What_Goes_Up · February 2, 2009, 4:52pm

Septic_Crank · February 2, 2009, 5:07pm

irishtimes.com/newspaper/bre … king58.htm

In other words, suck it up taxpayers.

Puck_may_be_Famous · August 30, 2009, 10:16am

Gayle Dunne has open her own grocery store on the jury’s site. D4 Stores is billed as a low-cost supermarket. From the photograp it seems to be stocked mainly with branded good. Selling those cheaper than the chains while making a profit is not really possible. Anyone care to do a price check?

independent.ie/national-news … 73245.html

IT’S ‘Dunne’s Stores’ alright, but not quite as we know it.

Move over Margaret Heffernan, there’s a new force in retail to be reckoned with, and she’s determined to deliver value to leafy environs of Dublin 4.

Gayle Dunne’s the name and D4 Stores is her answer to the prayers of the ladies who used to lunch, but who now much prefer to ‘Lidl’.

Speaking exclusively to the Sunday Independent as the doors of her new low-cost supermarket venture opened for the first time last Friday morning, Gayle, wife of high-profile developer Sean Dunne, said she expects to see a steady stream of local residents pouring through the doors of D4 Stores, which is located in the former Jurys Ballsbridge Hotel (now known as the D4 Inn).

Clearly enthused by her first foray into the retail business, Gayle said: “Both a convenience store and an off-licence with good parking are badly needed in this area. There’s also a real need for value for money. A lot of people in Ballsbridge have been wiped out financially like everywhere else in the country. There’s no Aldi or Lidl here, but people want value for money in Ballsbridge as much as they do anywhere.”

And while her well-known developer husband, Sean, may have had the new store fitted out over the past month, since Gayle first came up with the idea, it’s clear that the venture will be her baby.

“It was my idea and it’s my investment,” she says before adding that she will be taking an active role in its day-to-day management.

And should the Ballsbridge D4 Store prove to be a success, Gayle says there could be further outlets to come, with one in Donnybrook already under active consideration.

doubleglaze · August 30, 2009, 11:07am

Reckless trading…

theschmuck · August 30, 2009, 11:14am

Hmm, I don’t recall hearing of any planning/change of use application for a supermarket and off-licence in the hotel.