Promised land
Published: 05 November, 2007
Ireland has a powerful new force in retail property development called Chartered Land, the brainchild of Joe O'Reilly, the man behind the creation of Dundrum Town Centre, one of the most successful recent retail developments in the country.
O'Reilly set up Chartered Land last year, to bring together a portfolio of highly innovative retail property developments that are now under way.
This year O'Reilly appointed Dominic Deeny as chief executive officer of Chartered Land. Deeny is from Belfast and has wide experience in retail property development, having worked with Ewarts in Belfast for 11 years and with Westfield in Britain for six years.
In 2006, he and O'Reilly discussed setting up a separate company to handle the growing number of commercial developments in which O'Reilly is involved, and Chartered Land was born.
When he was with Westfield, Deeny worked on many major retail developments in the UK. Now that experience is being put to good use in Dublin, where Chartered Land has a current development portfolio worth about €3bn. The existing property interests held by the company are valued at €1bn.
Deeny says that what retailers are looking for is not just what's in their own particular box. "They need to be satisfied with the whole project," he declares. Strong relationships are vital, but good quality research is equally important. Deeny aims to ensure that Chartered Land brings this holistic approach to retail development. The avowed intention is to make the company the most dynamic and innovative property investment and development outfit in Ireland.
Chartered Land aims to create a portfolio of truly outstanding commercial developments that will change the Dublin cityscape, enhancing the lives of people living and working there, as well as creating many new opportunities for business development and enterprise. The company is now well and truly up and running with the corporate structure in place, but is hiring additional management personnel for its development team. It has involvements in an impressive number of developments, including the ILAC centre in Henry Street, Dublin, the Pavilions shopping centre in Swords, the Gaiety centre in South King Street, now under construction, and the longer-term plans for the Carlton site, which will link O'Connell Street and Moore Street.
O'Reilly bought British Land's stake in the development of the ILAC centre, so that it's owned on a 50:50 basis by Chartered Land and Irish Life. Much of the refurbishment has now been completed, with only the Moore Mall still to be done. One of the longer term benefits of the ILAC overhaul is that it will allow the tenant mix to be improved.
Deeny can't be specific at this stage about a definite completion date for the Moore Mall but the improvements to the rest of the centre have already increased footfall. What was a jaded looking 1970s-style mall is now a vibrant and up-to-date shopping space.
Last year, O'Reilly bought the Pavilions shopping centre in Swords for €500m, the biggest single property deal ever struck in Ireland. Subsequently, half the investment was sold, with Irish Life taking 25 per cent and Irish Property Unit Trust taking a further 25 per cent. Phase II of the Pavilions, linked to the Dublin Road and the Swords Central shopping centre, is opening now and should be largely completed by Christmas. By early October, Phase II, marketed by Bannon Commercial, was 75 per cent let.
The adjoining Swords Central is a mixed-use scheme with 14 retail units, anchored by Penneys. Swords Central is being marketed by CBRE and Jones Lang LaSalle. The linkage between Phase II of the Pavilions and the Swords Central scheme will bring the benefits of the Swords Central underground car park, with 320 spaces, to Phase II shoppers.
One of the latest signings for Phase II is Zara, which is taking about 1,400 sq m of space on two levels. It's paying a zone A rent of €2,400 per sq m and will be joining other top-line retailers such as Body Shop, Diesel and Du Pareil. Existing tenants in the Pavilions include a-wear, Benetton and Dunnes Stores.
Phase III is now being planned, offering retail, office space and civic amenities. When completed, the Pavilions will have just over 100,000 sq m of mixed-use development, similar to the pattern at Dundrum Town Centre. Already, research shows that retailers are enjoying turnover levels that compare favourably with the likes of Dundrum and Liffey Valley. The ultimate aim of Chartered Land is to make the Pavilions the destination of choice in north Co Dublin.
Deeny believes that the mixed-use concept is the way forward for shopping centre development: not just retail, but a whole blend of other amenities and facilities to appeal to the widest range of consumers.
Construction work is well under way at the six-storey 10,000-sq m Gaiety Centre in South King Street, with up to half of that retail space divided between three retailers. H & M and Zara have already publicly signed up for the centre; negotiations with the third retailer, Warehouse, were concluded recently.
Bannon Commercial says that the centre is scheduled to open in time for Christmas 2008 and Deeny believes it will give the retailers involved the major spaces they wanted in the immediate Grafton Street area. Recently, Chartered Land agreed a deal with Anglo Irish Private Banking for a forward sale of a part interest in the retail portion of the centre, for €100m.
Work is under way on planning the major redevelopment of the Carlton cinema site in O'Connell Street, but this is a very complex project. Planning approval could take up to two years and construction a further four, so the opening date looks like 2013.
Yet another project is Grand Canal Square, a highly ambitious scheme designed by Daniel Libeskind, the world-renowned architect, and consisting of mainly office and residential units, plus some retail in the form of convenience stores and cafés. It's an extremely innovative project which won't be finished until 2010.
All the projects with which Chartered Land is involved are in the Greater Dublin area. Deeny says that in time the company will be happy to look at Irish projects outside Dublin and also in the UK and further afield internationally. But for the moment, Chartered Land has more than enough on its hands, in the form of five or six years' complex project work ahead.
All this activity has helped to make the company the biggest single retail developer in the Dublin area. Along the way, Chartered Land seems set to reshape the way in which successful development enterprise is modelled. Its business model is being built on providing exactly what occupiers need and - in the process - is delivering exceptional and sustained financial performance.
