Opposition parties are scaring international investors off the Irish property market, according to the Public Expenditure Minister.
Michael McGrath was speaking after it emerged that Allianz had paused plans to invest in Irish property duty to potential for reputational damage.
The Irish Times reports that Allianz Real Estate, which manages a global property portfolio of €79 billion, was considering significant investment in the market; however, its Irish insurance arm warned against the move.
The Irish office voiced concerns over the potential for negative publicity due to the ongoing controversy around large institutions capitalising on Government tax incentives to buy up large swathes of housing stock before it gets to market.
On The Hard Shoulder this evening, Public Expenditure Minister Michael McGrath opposition parties are scaring international investors away from the market.
“I think much of it comes down to the political debate,” he said.
“Tonight, in the Dáil, the latter stages of the Finance Bill will be debated and you can be sure that institutional investors will be called everything under the sun.”
He said Ireland is in a “global competition to attract international capital” and the Government welcomes international investment.
“We are a Government that does want international investment but we are clear on the purpose of it,” he said.
“The purpose of it in relation to property is to increase supply. What we don’t want them to do is to come in and bulk-buy already developed estates or apartment complexes or ones that are already under construction.
“We want them to add to the supply to bring about developments that would not otherwise happen.
“There is a key distinction there and that is why we brought in the stamp duty surcharge to deter that practice of investors coming in and competing with first time buyers or other purchasers in the normal domestic market.
“Where they are coming in and bringing international capital to Ireland to deliver homes that wouldn’t otherwise be built that is where we need to, absolutely in my view, welcome it, embrace it and have an environment that is favourable towards it.
“Other countries will gladly take it and there is an enormous international competition underway for jobs, for investment and we just have to make sure we remain attractive.”
Allianz already has many investments in the Irish market – including a 50% stake in the Dundrum Town Centre.
The company told the Irish Times it is “selectively screening” investment opportunities in all sectors of the Irish market.
You can listen back to Minister McGrath here: