Homebuilder Glenveagh Properties plc has raised €500m through its initial public offering (IPO) on the Main Securities Market of the Irish Stock Exchange. It is the second largest IPO on the ISE this year.
Glenveagh is focused on building houses and apartments in the Greater Dublin Area, either for itself or in partnership with third parties. The initial market capitalisation is €696m following conditional dealings earlier this week.
ISE chief executive Deirdre Somers commented: “The successful IPO demonstrates the strong interest from international investors in Glenveagh and the Irish economy more generally.”
Justin Bickle, Glenveagh Properties chief executive, said: “Our primary listing on the Irish Stock Exchange has given us the platform to raise funds from a broad range of international investors which will enable us to deliver on our ambitious house building programme.
In Association with
“The Irish economy needs more houses and apartments and our listing is a key step in making Glenveagh a scale provider of housing that can help to address the supply shortage. Our IPO, and the significant capital now available to us, leaves us well placed to meet the construction targets we have set for ourselves.”
The company is the second housebuilder to list on the ISE in 2017 following the admission of Cairn Homes to the MSM in July. Other significant fund raisings on the ISE in 2017 include Allied Irish Banks, which raised €3.4bn in the largest IPO in Europe this year, and Greencoat Renewables, the Irish renewable energy company which raised €270m on its IPO in July.
Glenveagh Portfolio
Glenveagh claims that its combined land bank in Ireland has a gross development value (GDV) of €1,078m.
The company promoters are developer BDHL, which has been active in the Irish property sector since 2003, and BCL, an asset advisor which has principally served TIO RLF (an Irish residential property fund managed by Oaktree) since 2014.
The acquisition by the group of BDHL and BCL, together with the acquisition by Glenveagh of 27 sites owned by TIO RLF and other vendors, and the acquisition of Braddington and Greystones Devco, will be funded by the IPO proceeds.
Initially Glenveagh says it intends to target up to half of its homes at first-time buyers. Construction has commenced on four of the Conditionally Acquired Sites: (i) Marina Village, Greystones; (ii) Cois Glaisain, Navan, Co. Meath; (iii) Holsteiner Park, Clonee; and (iv) Herbert Hill, Dundrum. Glenveagh also expects development on the Naul Road Phase 1, Balbriggan, to commence in Q4 2017.
In addition to these sites, the company has identified a number of potential sites which it believes have a total estimated cost of circa. €1,060 million.
Glengeagh says it has 32 sites under active consideration with a total estimated cost (excluding transaction costs) of €425 million. Twenty five of these sites are expected to come onto the market by this year, with an estimated cost of €181 million.
In addition, Glenveagh says seven sites of ‘significant interest’ are expected to come onto the market in 2018, which have a total estimated cost of circa. €420 million.
Glenveagh's Origins
BDHL was founded by Stephen Garvey and bought its first site in mid-2003 and its second site in early 2004. By the end of 2005, BDHL had completed its first apartment development.
During the financial crisis years of 2007 through 2012, BDHL did not make any significant land acquisitions, but did maintain its construction operations and continued to work with Ulster Bank. With funding from the bank, BDHL purchased its first site following the financial crisis at Ballyboughal near Dublin airport in 2012 and that site was subsequently fully developed and sold.
In 2014, BDHL began discussions with Oaktree regarding BDHL developing sites in the Greater Dublin Area on Oaktree’s behalf. Oaktree engaged BDHL as well as BCL to provide development and asset advisory services for TIO RLF in relation to residential development.
BCL and BDHL were successful in obtaining the planning permissions for substantially all of the sites that TIO RLF wished to develop as well as for four sites that were resold to third parties prior to being developed based on the planning permissions obtained.
During the period 2015-2017, development began on four of the Conditionally Acquired Sites. BCL also began the sales process for the first tranche of homes in the Marina Village, Greystones residential scheme in 2016. Greystones Devco was incorporated in July 2015 and has provided development management services to TIO RLF for the Marina Village, Greystones project since October 2015.
Glenveagh Team
Glenveagh Properties’ founders are John Mulcahy (Executive Chairman), Justin Bickle (CEO) and Stephen Garvey (COO). The management team includes Michael Rice (CFO), Shane Scully (MD, Glenveagh Living), Chloe McCarthy (Company Secretary), Roger Browne (Construction Director), Tony McLoughlin (Construction Director), Eoin Moore (Operations Director), David Bennett (Investment Director), Ronan McKenna (Sales Director), Richard Caldwell (Procurement Director), Alan Cleary (Financial Controller) and Catherine Hanly (Planning Manager).
John Mulcahy was previously chairman and CEO of Jones Lang LaSalle’s business in Ireland and a board member of NAMA. Justin Bickle is chairman of TIO ICAV and has 22 years’ senior level experience in the private equity, legal, finance and property fields.
Proforma Financials
A proforma financial statement prepared by KPMG for the share vendors indicated net proceeds from the €500m share sale of €478m. After the asset purchases envisaged in the IPO Prospectus, KPMG indicated a net asset position for Glenveagh of €593m. That includes a value of €110m for the Oaktree properties being bundled into Glenveagh
Photo: Deirdre Somers with Glenveagh chairman John Mulcahy (left), Justin Bickle and COO Stephen Garvey (right). (Pix: Colm Mahady / Fennells)
