Dublin-based homebuilding firm Cairn Homes is to acquire the residential land portfolio from Ulster Bank’s Project Clear loan portfolio.

Ulster Bank has accepted a bid of €503m for the entire portfolio, with the par value of the loans acquired being around €2bn.

Cairns acquired the portfolio together with private equity firm Lonestar.

The loans are attached to 1,694 acres, including 31 residential development sites.

91% of the portfolio lands are located in Dublin and the surrounding commuter belt, representing around 20% of the available residentially zoned land in the greater Dublin area.

The portfolio will be divided, with Cairn contributing €378m for its 75% share.

The home builder plans to construct over 14,000 new homes over the coming years, with an expected net development value of in excess of €2bn.

The deal is expected to be completed by the end of the year.

Ulster Bank said the portfolio sale, the proceed of which will be used for general corporate purposes, is part of its policy of continued reduction of assets in RBS Capital Resolution and is in line with the bank's plan to strengthen its capital position and reduce higher risk exposures.