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| Arnotts on September 12, 2006, unveiled its plans to "transform" the area of Dublin City Centre bounded by Henry Street, O’Connell Street, Abbey Street and Liffey Street. The area, branded as the Northern Quarter, will be redeveloped into a lively new shopping and entertainment area complete with 47 new shops, 17 new cafes, restaurants and bars, 189 apartments and a 152 bed four star hotel. The Northern Quarter Development Proposal was said to represent a €700 million investment in the heart of the city. As part of the development plan, Arnotts said that it intended to bring on board a strategic partner with the appropriate expertise to develop the Northern Quarter. It said a competitive process would commence immediately to select a strategic partner. |
Arnotts has confirmed that it will reduce staff numbers by 580 during the construction of its Northern Quarter redevelopment plan in Dublin city centre.
The department store group currently employs 950, but it says its staff numbers will rise to 1,200 when the new development is completed.
Arnotts said it told staff of its plans at a meeting this morning, and it is hoped most of the lay-offs will be voluntary. But the Mandate trade union said it expected that most would be compulsory.
Mandate said this was a sad day for Arnotts and Boyers staff, and the Northern Quarter was coming at a huge cost.
Arnotts will re-locate from its current Henry Street store to the Debenhams store in the Jervis Centre later this summer. The current Boyers store on North Earl Street will be converted to an Arnotts furniture and home store to open in August.
Construction of the €1 billion Northern Quarter - which will include shops, 175 apartments, restaurants, bars and a hotel - is expected to start later this year. Arnotts says it will create 5,000 jobs when completed, in addition to 1,000 during its construction.
The project has been backed by Dublin City Council but is awaiting approval from An Bord Pleanála. Arnotts is expecting this decision within the next couple of months.
Last September, Boundary Capital, the AIM and IEX listed investment company, today announced that Brunner Limited, a vehicle in which Boundary is the majority shareholder, has agreed to subscribe €65 million for approximately 45% of the equity in Art Holdings Limited, a new holding company that will acquire 100% of the activities of the Arnotts Department Store group.
For the year ended 28 January 2007 Arnotts had turnover of approximately €146 million and a loss before tax of approximately €4.7 million, the loss arising primarily because of funding costs on the development land bank. Fixed assets at 28 January 2007 were approximately €269 million. Net debt at 28 January 2007 was approximately €249 million leaving net assets of €20 million.
The property assets included in the Arnotts’ Northern Quarter planning application have been valued by CBRE at €410 million without planning, and €450 million with planning. Arnotts is finalising the terms of appointment of a development manager for the scheme. Arnotts is also finalising terms for a minority equity investment in the scheme by a third party.
