Ulster Bank is poised to appoint Jones Lang LaSalle to sell a €1bn portfolio of Irish property loans.
The Royal Bank of Scotland subsidiary is understood to have selected the firm after taking bids from four potential advisers last month.
Although the portfolio has a face value of €1bn, it has been reported that the value of the underlying property could be as low as €250m.
This reflects the poor state of the Irish commercial property market, where average values have fallen by an average of 65% from the peak, without a sustained period of recovery.
The final discount to face value would be part of any potential transaction negotiations. UK and European loan portfolio sales such as RBS’s Project Isobel and Lloyds’ Project Royal traded at a discount of 30-40% to the par value of the loans.
The portfolio is heavily weighted towards assets in Dublin and includes the headquarters of State Street bank in Ireland. The 175,000 sq ft building, which has a rent roll of more than €7m pa, was developed by Liam Carroll’s collapsed Danninger development company.
It is thought to include both receivership and consensual sale assets.
Some 70 loans have been earmarked by the bank for inclusion in the portfolio. They are secured on a mix of residential and commercial property. One-third of the portfolio relates to Northern Ireland.
Ulster Bank and Jones Lang LaSalle declined to comment.
