When even the vultures are turning up their noses…

Last weekend saw the publication of an RICS report (which was covered by the Independent) on the global distressed property market (from the RICS “distressed property is defined as a property that is under a foreclosure order or is advertised for sale by its mortgagee. Distressed property usually fetches a price that is below its market value”) and noted that Ireland was top of the pile by reference to the % of local RICS members who expected to see distressed property come onto the market in Q2 of 2010 (100% in Ireland which is quite a feat when you consider what has been happening in the United Arab Emirates for the last decade and less than 50% of RICS members predict distressed property to come on the market there).

However in terms of specialist buyers of distressed property (sometimes called vulture funds), it would appear that there is little appetite for Irish distressed property. The report shows that by reference to Q1 of 2010 we had the lowest level of interest compared with the amount of property available. There are a number of possible reasons for this – better opportunities or value elsewhere for example. However another reason is that property is seen as having some way to fall and although asking prices might be distressed in the context of the existing market, they may not be in terms of the short-term direction of the market.

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NAMA approves sale of K-Club

The Irish Times today reports that one of the top 10 developers whose loans were reported to have been transferred to NAMA in the first tranche, Gerry Gannon, placed his 49% shareholding in the K-Club in Straffan, Kildare on the market six weeks ago. The report goes on to say that NAMA would have approved the sale. The shareholding is reported to be worth in the region of €60m and the agents handling the sale, HT Meagher O’Reilly report that “there was significant overseas interest in his stake in the K Club and the likelihood that it would be disposed of in the not too distant future”. Gerry Gannon is also reported to be selling a 74-acre farmland property opposite the K-Club – known as Lodge Park it is expected to sell for €20-25,000/acre, according to the article, which would seem to build in development potential for the property (with average farmland selling for €6-10,000 in the State).

The agent’s website is here, though I was unable to find details of either property (UPDATE: 20th September, 2010 – the details now appear to be present on HT O Meagher’s site). Perhaps I was using the wrong search criteria or perhaps the properties are not being marketed generally. It is reported in the Irish Times article that the owner of 51% of the K-Club, Michael Smurfit, will have matching rights to the highest offer for Gerry Gannon’s share of the K-Club and that Gerry Gannon will retain some development rights.

UPDATE: 16th January, 2011. Demonstrating again NAMA’s glacial progress is news in today’s Sunday Independent that co-owner of the K Club, businessman Michael Smurfit has reportedly expressed an interest in buying Gerry Gannon’s share of the down-on-its-luck Kildare club. However the paper reports that “no figure has been put on the table and Dr Smurfit is waiting for a response from Nama but they have yet to get back to him”.

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