US fashion retailer Abercrombie & Fitch has reignited its interest in Ireland and is in talks to open in the former Habitat store on College Green in Dublin, according to three senior retail sources.

The building is owned by Paddy McKillen of Clarendon Properties, the property investor who is taking a legal challenge against Nama and Tony Leonard.

Abercrombie has been looking at the Irish market for about three years but decided last year to hold off on plans to expand here. However, sources say detailed talks are now underway in relation to the College Green building, which is close to Trinity College students – the retailer's ideal target market.

In recent days, Clarendon's Pextell vehicle has sought planning permission to change the first and second floors of the building from office to retail use, adding nearly 800 sq m of extra space.

A document submitted by Manahan Planners states that a previous plan to open a licensed restaurant in the premises "has not been taken up" and that allowing additional retail space "will create a retail unit large enough to attract a larger occupier than is presently looking at this premises".

Pextell had net current liabilities of more than €260,000 at the end of June 2009.