Irish Life Investment Managers (ILIM) has bought 262 apartments in south Dublin that were due to be put up for sale and the asset manager plans to rent them.

ILIM is believed to have paid more than €100 million to Irish builder Park Developments for the Fernbank scheme, which is situated on land formerly owned by Notre Dame school in Churchtown.

This surprise move is a blow to those who were hoping to buy an apartment at the prime site, just a short walk from the Dundrum Towncentre and Luas stop. But it will help to satisfy the pent-up demand for rental properties in the area.

First units Park will complete the construction, with the first units due to be ready by the end of this year. The remainder will be finished in the first quarter of 2020. The scheme comprises 56 one-bedroom units, 188 two-beds and 17 three-bed apartments.

This is part of a move by ILIM to establish itself as an institutional landlord. The asset manager expects to invest about €1 billion for investors over the next couple of years acquiring properties that will be rented to tenants.

Rents in the area range from about €1,650 a month for one-bedroom apartments, to €2,000 for two-beds, and €2,750 for three-beds.

Park’s managing director Sean O’Neill said the sale would enable it to “accelerate the delivery” of other developments in its pipeline. It had bought the Churchtown site in 2005 for €30 million.

“The transaction is a significant departure from our normal approach to selling this type of residential development,” he added.