AIB provides €155m loan for Dublin retail centre

AIB Real Estate Finance gave the loan to JSC Properties.

Allied Irish Bank has provided a €155 million loan to refinance the Jervis Shopping Centre in Dublin, Real Estate Capital has learned.

AIB Real Estate Finance gave the loan to JSC Properties, a company owned by Northern Ireland property developers Padraig Drayne and Paddy McKillen. The retail park was opened in 1996.

The seven-year whole senior loan is secured against the 35,766-square-metre shopping centre, which is understood to reflect a loan-to-value ratio in the region of 40 percent. Eastdil Secured and LeBruin Private advised JSC Properties.

The mandate has been secured amid “significant competition” from European funders, including UK and German lenders, a market source said.

The Jervis centre is one of the prime shopping centres in Dublin, bordered by Jervis, Upper Abbey, Mary and Liffey streets. It has more than 90 international and national outlets, including New Look, Tesco and PC World.

The centre is reportedly generating a rental income of more than €16 million per year, with prospects for that to increase to €18.5 million over the next 18 months.

“The current yield on the Jervis Centre of over 10% based on the reported annual rent roll of €16 million and a €155 million refinancing loan is high in the current retail environment,” said Kelly O’Hara, head of real estate at Irish law firm Dillon Eustace.

“Being such a strong and established shopping location with a good brand and high yield, this is very attractive to Irish banks and non-bank lenders looking for good, well managed retail assets with internationally renowned tenants to finance,” O’Hara added.

In January, it emerged that AIB provided a €32 million loan to Marathon Asset Management to finance the Belgard Retail Park in the Tallaght area of the Irish capital.