It has not been the easiest of entries into the Irish market for Henderson Park, the British private equity real estate giant. In late 2019, as the company was finalising a €1.34 billion deal to acquire Green Reit, the listed Irish real estate investment trust, Finance Minister Paschal Donohoe disclosed a string of new measures designed to cut out loopholes that reduced tax liabilities on certain property transactions.

The changes to Section 28 and Section 60 of the tax code increased Henderson’s tax bill on the Green Reit deal by a hefty €65 million. Henderson has since challenged the move in the High Court, launching legal actions against the Revenue Commissioners, the Attorney General and Ireland itself.

And, as it continues its battle with the state, the real estate titan has been forced to bed in its new Irish portfolio while the economy has endured a spate of pandemic-enforced lockdowns. The Green deal made Henderson Park one of the biggest office landlords in Dublin with a blue-chip client roster and, as part of its strategy, it has been disposing of certain properties.

But just how was the acquisition structured? How much debt did the private equity fund take on to finance the purchase and how much interest is it paying? Plus, with the economy in lockdown, how is its portfolio performing?

An analysis of the company’s corporate holdings sheds new light on one of Ireland’s biggest property deals.


As it closed the Green Reit deal, Henderson Park incorporated a company called HPREF Ireland Limited. This is effectively the holding company for the assets. Its shareholder is HPREF Dublin Office Bidco, which is the main operating vehicle. This operating company is in turn controlled by a Henderson Park-controlled Icav, a tax-efficient investment vehicle.

But to understand the performance and the granular detail of the property portfolio you need to look at the company sitting in the middle – HPREF Dublin Office Bidco – as this is the company where much of the money flows through.

This company recently filed accounts for the period stretching from July 18, 2019, to November 30, 2020. By cross-checking this company with other filings within the wider Henderson Park group, it is possible to extrapolate interest payments, funders and both its income and debt levels.

This company received management fees of €6.5 million from its trading subsidiaries, plus a further €22.4 million in dividends. In essence, this combined income of €28.9 million was revenue flowing up from the individual companies that control specific properties with the former Green portfolio.

Unlike many landlords, Covid-19 did not have a material impact on the level of rent it collected, with the company stating that its properties – mostly in Dublin and Cork – are let to large multinationals who continue to pay their rents. Plus, the company said that the majority of its properties are in the logistics and prime office sectors, which it says have not been impacted as much as other sectors during the pandemic.

Intercompany debt and Blackstone

Although the company recorded income of €28.9 million, it made a pre-tax loss of €223 million. And the nature of that loss says much about the initial deal, and the financing behind it.

“While the accounts show a loss of €223.6 million for the period, the majority of this loss relates to group items such as intercompany loan forgiveness and shareholder loan interest. The board is also happy that the company has the support of its parent company HPREF ICAV to continue in operation,” the company documents state.

The company bore acquisition costs of €18.6 million stemming from the Green Reit deal. However, the big piece of the loss stems from writing off shareholder loans to subsidiaries of €151 million. Based on other company filings, it emerges that this loan was provided to HPREF Ireland Limited and that the write off relates to the interest-free part of the company loan.

Delving further, it emerges that HPREF Ireland Limited was initially provided with a shareholder loan of €290 million by its parent to repay outstanding bank debt. During the year, it repaid €80.7 million of the shareholder loan with about €151 million being written off as outlined above. This leaves a balance of €57 million left outstanding.

Where did HPREF Dublin Office Bidco get the money in the first place? Well, to facilitate the Green acquisition, it received a €499 million loan from its own shareholder, the tax-efficient Icav.

It has subsequently paid back €49 million of that. The loan initially carried a 13 per cent annual interest rate, although this has subsequently been reduced to 9 per cent, according to company disclosures.

All told, the operating company paid its shareholder €59 million for “shareholder loan interest” during the period between July 18, 2019, and November 30, 2020. Some of this was offset by €17 million in finance payments it received from its own subsidiaries during the year.

It has also received significant funding from Blackstone, the US-based private equity giant. Filings reveal that Blackstone provided a €1.18 billion loan on December 21, 2019, days before the Green Reit deal formally closed.  

The loan was split into two tranches – €620 million and €565 million. The €620 million loan is repayable after four years with an option to extend for a further year. The latter loan matures after one year, but there is an option to extend for a further year. Filings reveal that the loan was subsequently extended until the end of 2021. The interest on the Blackstone facility had a margin of 2.5 per cent per year.

Company filings show that HPREF Dublin Office Bidco paid Blackstone €30.8 million in finance costs during the period between July 18, 2019, and November 30, 2020.

Overall, the company remains optimistic about its future: “The board believes that the Company is well-positioned for the future, having assembled through its subsidiaries an attractive portfolio of properties in line with its parent, HPREF ICAV’s (the “Group”) stated investment policy. With favourable economic conditions in Ireland, particularly in Dublin, the board believes that the company will continue to deliver attractive risk-adjusted shareholder returns,” it said.

Further reading

Almost two years after being hit with an unexpected €65m tax bill, Henderson Park is taking its case to the High Court

When business met politics: Green Reit, Henderson Park and the plea for clemency on surprise €65m tax bill

Ian Kehoe: Brexit, business and Budget 2020

As Henderson Park navigates tax and a pandemic, Green Reit founders begin corporate move to access spoils of €1.34bn sale