Apollo has made a 16% return on €626M of commercial loans it acquired, primarily linked to Harcourt Group, with the loan purchased in 2017 for €300.2M from the National Asset Management Agency following a bidding process.

Investment giant Apollo used a Luxembourg-based special-purpose vehicle, European Principal Finance Acquisitions 65, to acquire the loans, held against assets including six Harcourt-controlled Irish shopping centres, the Irish Independent reported.

Known as the Hexagon portfolio, the retail assets included Donaghmede Shopping Centre in Dublin, Galway Shopping Centre, Laois Shopping Centre, Longwalk Shopping Centre in Dundalk, Parkway Shopping Centre in Limerick, and Letterkenny Shopping Centre.

The loan agreement with EPF included deleveraging targets, and the shopping centres were the last significant remaining assets within the EPF vehicle and were sold to a fund managed by Davy Real Estate in July 2023 after Apollo had appointed KPMG as receiver on the retail assets to facilitate a deal.

Accounts for the Apollo vehicle in Luxembourg showed that at the end of 2023, it had received cash collections of €348M in relation to the loans, with no amounts outstanding. Cash collections by EPF in 2023 totalled €80.4M, more than double the €37.8M collected on the loans the year prior.

“Collections exceeding the purchase price of the portfolio, in an amount of €39.2M, were recognised as other interest receivable and similar income in accordance with the accounting policies,” the accounts for EPF Acquisitions 65 say.

The Harcourt shopping centres had been held through Harcourt subsidiary Lindat and had a selling guide price of €100M but were eventually sold for circa €75M to Davy firm Marisola, while Davy acquired the Kennedy Wilson-owned Marshes Shopping Centre in Dundalk at the same time.

“During the year the group made a strategic decision to exit the Irish retail sector and disposed of its six shopping centres in Ireland through a sale of its subsidiary Lindat in July 2023,” the accounts say. “The sale of Lindat and the associated debt restructuring led to a significant gain in the group’s 2023 financial results.”

The completion of the sale effectively concluded EPF’s remaining security in the Harcourt Group, with the exception of assets in the Bahamas, including the former Royal Oasis Hotel and 34-unit waterfront condominium development Suffolk Court.

The group also owns several hotels in Ireland, including Lough Eske Castle in County Donegal, and it has been involved in commercial development in Dublin, the U.S. and Tobago.