The Subplot

The Subplot | Irish money, Hut Group, Liverpool co-living

Welcome to The Subplot, your regular slice of commentary on the North West business and property market from Place North West’s analysis editor, David Thame.


  • Emerald Isle: Irish investors are returning to North West property, best be prepared
  • Elevator pitch: your weekly rundown of what’s going up and what’s not

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Some old friends return to North West real estate

We’re less than a fortnight in, but 2022 is already seeing the first signs of a return to this region of Ireland-based property investors. Who will come, and how much will they spend?

It’s been a decade or more since Manchester, Liverpool and Preston enjoyed the attention of Irish property investors. Thanks to the successive explosion, implosion, then explosion again of the Republic’s economy, Irish property minds have been elsewhere. But evidence is mounting that investors there are preparing to return to North West real estate.

Early movers

The first signs are already visible for those who want to see them. McAleer & Rushe, which operated both north and south of the border, chose this month to diversify its development business by buying CEG’s 22-storey apartment story site at 20-36 High Street, Manchester. Irish developer McKinney Group has been pushing on with plans for a £60m surf centre in Trafford Park, while Irish hotel group Dalata has surged into Manchester with a string of new developments, despite the pandemic.


Yet speak to capital markets advisors in the big Manchester and Liverpool brokerages and you get a different impression. “I’ve not done much with Irish investors for a while or seen them particularly active in Manchester,” one agent confessed. Several big firms declined to talk on the basis that they had nothing to talk about.

Once upon a time

Agents remember that until about 2006 Irish investors were the darlings of North West property. Money from big names like Ballymore and Green Property, along with a host of others, helped turn the wheels of the region’s real estate sector. The Great Financial Crash blasted the wheels off the Republic’s property sector (and a selection of additional self-inflicted wounds meant the engine fell off, too). The National Asset Management Agency (NAMA) was set up to wind down €77bn of property assets. That long tail (and tale) of woe is still recent and painful history. Hence Manchester and Liverpool agents stopped looking across the Irish sea.

The big reveal

So what’s going on? Why the confidence that – despite agent scepticism – something really is on the boil? For the answer, talk to intermediaries in Dublin. Their answer boils down to this: Irish investors have plenty of opportunities at home, and are having a high time exploiting them to the tune of around €4.5bn in 2021. But their frantic activity is driving up prices in their domestic market, and that is revealing a yield gap between Ireland and the UK, a gap that is beginning to appeal. The yield gap coincides nicely with an easing of Brexit and perhaps also of pandemic uncertainties.

Marie explains

Marie Hunt, executive director at CBRE in Dublin and the unchallenged queen of Irish property analysis, says: “I think the reason is that pricing in Ireland has not deteriorated to the same degree as in the UK in the most recent cycle, hence there is a perception of better value in some sectors. For example in the retail sector, the Irish market was better insulated than the UK this time around, predominantly because Irish developers built no new stock in the last decade and a lot of our significant price correction occurred in the immediate aftermath of the global financial crisis. Therefore, while Irish retail was affected structurally and this impacted on values, the scale of value deterioration was not as significant as in the UK.”

Here they come

What comes next is a move back to the UK. “Pricing in Ireland is quite keen and I’m sure there are some high net worths who see better value in some regional UK markets if they can navigate the currency situation,” Hunt says. “Now that Brexit has played out and we are nearing the end of uncertainty posed by Covid, not to mention able to travel to inspect opportunities, I think we could see renewed focus on opportunities in the UK over the next 12-18 months.”

For instance

The keenest yield in Dublin offices is 4%, in UK regional offices 4.75% (give or take), and in prime retail, it’s wider still at 4.5% in Ireland, 6.5% in the UK. In the world of hotels, regional UK hotels is 7.25%-8% compared to 4.25%-7% in Dublin. Money, like water, will seek out opportunities, and in the coming months more Irish money will be flowing this way if the price differential between Dublin and North West cities continues to look promising.

Who’s calling?

Today CBRE data shows yields on practically every asset class in Ireland stable or stronger, yet the same classes in the UK are weaker everywhere exception sheds and supermarkets. As yet, just a few Irish eyes are smiling on the UK’s North West once again. But many more mobile high-net-worth investors will begin to see the appeal fairly soon, arriving singly or via the usual private equity vehicles. Think lot sizes up to £25m, say the wise heads.

The Subplot Elevator Pitch 07.12.21


Going up, or going down? This week’s movers

Despite jabbing the buttons, online beauty giant THG is still going down, while the emerging co-living sector is stuck between floors after an unhelpful encounter in Liverpool.

All Hale (sic) THG

Work on site at THG’s new 1m sq ft HQ campus at Columbia Threadneedle’s Airport City campus is still due to begin “in the first half of 2022” according to those in the know on the developers’ side. Or so Subplot was told yesterday, meaning no change since October (Subplot, 26 October 2021). However, more modest THG plans for the Hale Country Club hit some winter ice. The proposals submitted to Trafford council in May 2021 were withdrawn just before the Christmas holidays after the environmental health people gave it a big thumbs down.

The setback comes as eyes turn to the complicated sale-and-leaseback arrangements between THG founder Matthew Moulding and the newly-floated THG (arrangements worth about £350m, says The Guardian). For an online business, THG has always seemed super-keen on real estate, some of which appears (to those of us who live outside the beauty bubble) somewhat tangential to the business of packing and posting lotions and potions. The Hale club is a case in point. The THG share price plunged after investors reacted badly to a fundraising last autumn, and has stayed low. Today it is trading 75% down on this time last year. Perhaps investors should start rating THG as a tenant as much as an online retailer? Or perhaps they already are?

Co-living in Liverpool

Next week Liverpool City Council pronounces on Crosslane Co-Living Group’s plans for New Bird Street in the Baltic Triangle. Planners say that 192 of the 236 studio bedspaces (each of which comes with a kitchenette) do not meet official space standards, the scheme does not include a sufficient mix of housing, nor enough affordable housing. The developer responded saying it thought an all-studio scheme was fine, and how on Earth could they practically provide the 40-plus affordable bedspaces the council wants to see? For the record, most of the bedspaces are under 270 sq ft, whereas national standards require studios to be 398 sq ft. The 236 residents will share 18,000 sq ft of communal space.

The reason this matters is that developers hoped planners (and residents) would be happier if co-living bedspaces felt more like little homes than like student rooms. This is what Crosslane has been edging towards. If planners do not like this approach, and do not accept Crosslane’s argument that you can’t feasibly do affordable housing in a co-living block, then co-living in Liverpool has a problem. The real showdown will come in February when Liverpool’s cabinet will consider a wider policy statement on co-living. Sooner or later the issue will end up before a planning inspector, which will be revealing. In the meantime, you can read the full, quite dramatic, officer report here.

Get in touch with David Thame: | 01544 262127

The Subplot is brought to you in association with Oppidan Life.

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Your Comments

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270sqft is circa100sqft smaller than a standard caravan.


Oh dear….What happened to the Chinese cash? Has it expired?

By Beryl

The future of Co-living will be determined IMO by the planning departments, the willingness of people to live in such a small area and the developers wanting to maximise unit numbers.
It’s all very well providing large communal spaces, but not everyone will be comfortable with them and even if they are would they be okay then retreating to their cosy “cell” afterwards? One of the above three will decide the future, but whom?

By Just saying

Oh dear! another development rejected by Liverpool City Council, though no one is forced to take these properties ,they have the choice, meanwhile do we have other developers putting schemes forward for the Baltic … no.
Maybe we should put caravans there instead,

By Anonymous

Where is the long term value in building such small habitable spaces in Liverpool’s Baltic Triangle? Mark my words, these schemes are never fully occupied, and are used predominantly as safety deposit boxes for overseas investors. Is this best use of the land? LCC’s new Local Plan might go some way to address this.

By Old Hall Street

Bungalows it is then, with nice big rooms and front and back gardens, no controversy with height, elderly people in the Baltic to satisfy the social mix as it`s becoming too much of a young persons enclave, of course the noise from late night bars will have to be addressed. After that we can leave the rest of the empty or derelict buildings as a monument to our heritage.

By Anonymous

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