Today’s Irish Times carries an interview, penned by Simon Carswell, with Steven Seelig, the most recently appointed member of NAMA’s board who took up his position on 26th May 2010. Steven was formerly with the IMF and brings an international, distressed economy perspective to the NAMA board which is otherwise domestically centred. A few interesting nuggets are pick up in the newspaper article today including a possibility of NAMA funding the sale of its properties by offering loans to buyers.
But a couple of sentences caught my eye – “Seelig points to Nama’s approval of €2 billion worth of sales last year. The agency’s target is to sell 25 per cent of assets by the end of the year.” This is news because the only previous mention of a 25% disposal was in the June 2010 NAMA Business Plan which said on page 10 that the agency’s policy was to reduce debt by 25% by (end-, presumably) 2013. A query has winged its way to NAMA asking for an explanation but meantime, the 25% was again mentioned by the self-same Simon Carswell on last night’s Tonight with Vincent Browne (37 minutes in) when he said “I think they are actually going to start selling properties into the UK market which is performing much more strongly than here. There is no market here. So I think the target is to sell a quarter of the assets this year”.
So let’s remind ourselves of NAMA’s involvement in the UK. The latest estimate is that some 26% of NAMA’s assets (a total of €71bn, 26% would equate to €19bn at nominal value and €8bn at the value NAMA paid using NAMA’s average haircut across its entire portfolio). NAMA has already overseen some disposals of course but the total disposals in 2010 amount to less than €2bn across all of NAMA’s portfolio (which includes Ireland, the US, UK, Rest of World). So that would mean that there was up to €5bn more of assets which NAMA will sell in the UK market this year.
As exclusively reported on here a fortnight ago, it is expected that the sale of 20 Grosvenor Square will generate nearly €300m. The sale of Derek Quinlan’s 35% share in the Maybourne hotel group may yield another €300m. Although Paddy McKillen’s loans haven’t yet transferred to NAMA, if his loans on Maybourne are redeemed/refinanced then that may yield another €300m. Now that Battersea has finally received planning permission, there may be several €100m to be redeemed there this year if investors are found. But it is likely that most disposals will be faceless office blocks and retail units. Still though, €5bn (potentially) is a significant sum.
Lastly let’s remember that the IMF wants NAMA to dispose of assets sooner rather than later and FG, the party likely to lead the next government, wants NAMA to sell soon also.
NAMA Wine Lake 
“It is not about selling real estate because you have to get to the real estate. It is about getting borrowers to give up money,” he said. This wasn’t popular, he said, as the media felt Nama should be more transparent and the public wanted those who forced large debts on the State to be punished.
“We are not going out tying some guy up to a pole in a square and whipping him until he gives up his wife’s money. But we are getting some of these people to get their wives to say, ‘okay, all of that money that we transferred is coming to Nama’,” said Seelig.
Yes… There it is at last. The admission that NAMA’s focus has been on the developers’ wives rather than selling real estate. They have been singularly unsuccessful in both tasks.
Also, he should know that the developers did not force large debts on the State. That was the government, who made two very basic and unforgivable mistakes that forced this debt on the people.
1. They gave a guarantee to the banks’ bondholders.
2. They created NAMA.
The developers’ debts should have been left to the banks and the developers to sort out. They created them. It should have remained a private issue – not turned into a public one.