CAPREIT Blasts Irish Investment Scenario, Amazon Bypasses Dublin

The Irish real estate market has been hit by a double blow after Amazon Web Services bypassed Dublin in its latest round of data centre investment in Europe, while CAPREIT’s boss has delivered a stinging rebuke of the real estate market.

Mark Kenney, CEO of Canadian Apartment Properties REIT, which founded Ireland’s largest residential landlord, in an interview with The Sunday Times vowed never to invest in Ireland again, blaming the “untrustworthy environment” of the residential rental sector.

Kenney lambasted the Irish government for its rent cap policies, saying they had driven up the cost of apartments, choked the delivery of new supply and deterred international capital from being deployed in the country.

“Ireland has made it very clear that it does not want rental,” Kenney said. “We would never look at Ireland again. It’s an untrustworthy environment.”

CAPREIT pulled out of Ireland completely in June, announcing it had sold its remaining equity interest in Irish Residential Properties REIT for aggregate proceeds of approximately €52M, after it had reduced its ownership from 18.7% to 11.3% by 31 March. During the second quarter, CAPREIT sold a further €73M of equity in Ires and completely disposed of its ownership.

Meanwhile, Ireland has failed to secure any of the more than €35B investment in Europe pledged by Amazon Web Services, according to the Irish Independent. 

AWS said it plans to invest €9.5B in the UK over the next five years on building, operating, and maintaining data centres. However, it has not earmarked any additional investment in Ireland for this latest expansion phase.

“AWS declined to say if concerns about Ireland’s energy supply or planning process had been a factor in determining locations for its current investment programme,” the paper reported.

AWS has a significant data centre operation in Dublin, including at Clonshaugh Business Park in Blanchardstown and in Tallaght, and it received planning permission for three new data centres at its existing site in Cruiserath Road in Dublin last year. Those should get built, but investment in more is now in doubt.

That planning decision was challenged to An Bórd Pleanála, which raised concerns over the supply of electricity required for the new centres.