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Saturday 21 October 2017

RTE agrees Donnybrook sale for a 'flabbergasting' €107.5m

Director general Dee Forbes
Director general Dee Forbes

RTE has agreed to sell nearly nine acres of land on its Donnybrook site for almost €108m - €33m more than was expected.

Irish property group Cairn Homes agreed the price, which far exceeded the €75m guide.

It is understood that more than 500 homes will be built on the site, which would equate to a purchase price per unit of more than €181,000.

Debt

RTE director general Dee Forbes said in a statement that the decision to sell the land was taken because the state broadcaster has been operating with vastly reduced commercial and licence fee income of around €100m a year.

She said the money raised will be invested in capital projects, essential workplace improvements and reducing debt.

"RTE is playing catch-up in an industry and market that is evolving rapidly, as Irish audiences embrace new technologies which are influencing how and when they consume content, including RTE content," she said.

"The investment which has been enabled by this land sale, along with further restructuring of the organisation, will allow us to better serve the needs of our audiences."

Savills Ireland director Mark Reynolds said this was an exciting opportunity for those hoping to get on the property ladder.

"When we launched Project Montrose to the market back in April, we described it as a once-in-a-generation opportunity to be part of a truly transformative development story in one of Dublin's most affluent and fashionable areas," he said.

"The competitive bidding process and final sale price of €107.5m is testament to that."

While RTE is celebrating the sale, property market sources are said to be "flabbergasted" at the massive price paid for a site that was guided at €75m.

"You're looking at around €200,000 per unit there before you've even done anything, on a site which is likely headed for years of battles in the planning process. It doesn't make sense for regular development," said one property expert.

Investor

It has also been suggested that there will not be enough interest in snapping up 500-plus apartments at the prices indicated.

Sources said the only way to get such a site to work financially was if the entire finished development was acquired by one big investor - for example, a pension fund or an international venture capital company, and rented out en masse.

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