Ballymore boss Sean Mulryan in £500m fundraising campaign

Ballymore boss Sean Mulryan in £500m fundraising campaign

Postby PVC King » Sun Aug 23, 2009 8:31 am

Tycoon seeks investors with at least £30m each to expand his European property empire

Sean Mulryan, the Irishman who built Ballymore into one of Europe’s biggest property companies, is on a £500m fundraising campaign to finance expansion of his private property empire.

Horseracing fan Mulryan — Ireland’s biggest builder — has been hit hard by the credit crunch and the slump in property values. But now he wants to raise fresh equity capital from wealthy investors prepared to put in at least £30m each in order to get Ballymore building again.

The money would help to finance between five and six new projects. It is understood Ballymore is targeting wealthy funds and professional investors. It has 43 different development projects in its portfolio.

Ballymore has been forced to put on hold a string of high-profile schemes because of the credit crunch — including a project in Manchester, which it had hoped would become the tallest residential tower in Europe. Work was halted on the Piccadilly Tower last year after £8m was spent laying the foundations.

Friends of Mulryan, Ballymore’s founder and sole shareholder, say that now the commercial property market has begun to stabilise he wants to raise cash so that he can increase the scale of its development programme tenfold from the last boom.

Ballymore, like its property peers, used to rely heavily on debt finance to fund its schemes. However, many of its Irish bank lenders are restricting new loans, so it has to find alternative sources of capital.

The company is behind some of the most glitzy residential buildings in the UK — including the 48-storey Pan Peninsula Tower at Canary Wharf, east London.

The apartments were sold during the boom to wealthy City high-flyers and overseas investors.

Since the credit crunch hit, though, a significant minority of purchasers who bought apartments off-plan are struggling to make their final payments and have formed an action group to try and renegotiate terms with Ballymore. The company has been forced to set up a special unit to deal with the Pan Peninsula Buyers’ Association.

As well as properties in Britain, Ballymore has a large property portfolio overseas, which includes the five-star Kempinski Hybernska hotel in central Prague housed in a 17th century listed building.

The group appears to have survived the credit crunch after cutting jobs and selling off private assets to cut costs. Last autumn it was reported that Mulryan had put 25 racehorses and two helicopters up for sale and decided to share his executive jet with Johnny Depp, the film star, to save money.

A group re-organisation saw about 50 jobs lost. Last year Mulryan stepped up to become executive chairman to focus on courting investors and developing group strategy, with David Brophy appointed group chief executive.

In the past few months the group has continued to seek planning permission for new schemes.

In May, plans were lodged for two towers at the £2.5 billion Wood Wharf development in London’s Docklands. It is working on the scheme in partnership with British Waterways and Canary Wharf. The first tower is designed by Pelli Clarke Pelli and will be 194 metres tall.

The business was founded in 1982 when Mulryan, who was born in Oran, County Roscommon, was working as a local builder in Kildare. He sold his house, his car and his wife’s car in order to finance his first development.

Under his stewardship Ballymore has grown from a small company building domestic housing in Ireland to one of Europe’s biggest property development and investment companies.
PVC King

Re: Ballymore boss Sean Mulryan in £500m fundraising campaign

Postby johnglas » Sun Aug 23, 2009 10:55 am

Just like the Bourbons: learned nothing and forgotten nothing!
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Re: Ballymore boss Sean Mulryan in £500m fundraising campaign

Postby PVC King » Sun Aug 23, 2009 3:06 pm

I wouldn't equate him with that type of behaviour. Very shrewd operator who offloaded a lot of expensive land before things got really rough for development land as an asset class.

With so much blood on the floor in European Real Estate amongst competitors to have experience of developing large projects and surviving the recent crash will make investing with him very attractive. His key advantage is that he already holds the land and in many cases live development consents; as such Ballymore has a significant time advantage over investing in a pure opportunity fund; most of which have vaguely identified opportunities but suffer the risks of being gazzumped during the fund raising process with investors having an intention to invest in a real estate rebound but find their money sitting with a Prop Co in cash earning 1% less the 1% asset management fee.

A couple of high profile investors getting on board and there could be a significant first mover advantage. After British Land this week stating that they are moving from consolodation of existing assets to a more expansive phase; it would appear that declared market psychology appears to have improved dramatically.
PVC King

Re: Ballymore boss Sean Mulryan in £500m fundraising campaign

Postby jdivision » Sun Aug 23, 2009 8:37 pm

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