It seems that a loan underpinning the Opera shopping centre development in Limerickis now in NAMA. The Limerick Leader reports that the Limerick City Council has written to NAMA, apparently expressing concerns about the dereliction of the site (pictured here) and urging the agency to progress with the project. The developer is Regeneration Developments Limited, owned by Belfast estate agent Gary McDowell and Suneil Sharma, member of the Northern Ireland Policing Board.
Back in 2006, it was all so different and the plan was to develop a €350m mixed use complex which would feature the biggest shopping centre inMunster and was to have created 300 jobs during construction and 800 jobs once completed. The project suffered planning setbacks, which might explain the Limerick City Council frustration at what apparently has been a five year delay in starting construction.
The project is unusual in that apparently Anglo Irish Bank has a 50% share in the scheme – in other words, Anglo didn’t provide funding to the scheme in the form of a loan, it actually took equity in it.
What is amusing on here is the ignorance amongst politicians about how they can communicate with NAMA. Last summer, Limerick TD Willie O’Dea was getting exercised over whether he could approach NAMA with health and safety concerns at a different property in the city, he was fearful of running foul of NAMA’s anti-lobbying rules. NAMA chairman, Frank Daly told a Dail Oireachtas committee hearing that NAMA positively welcomes information on health and safety issues with its property. Limerick City Council has no such qualms with communicating with NAMA though it is interesting that one of its reasons for contacting NAMA was apparently to urge the commencement of the project.
UPDATE: 10th May, 2011. It seems that Suneil Sharma and Gary McDowell have divested themselves of their interest in Regeneration Developments Limited. According to the latest (auditor qualified) accounts for the year ending 31st December 2008 (available here) and the latest annual return for the period to 25th July 2009 (available here), the directors are NAMA Top 30 developers Jerry O’Reilly, David Courtney and Terence Sweeney . There are two issued shares in the company and both are owned by nominees, Pegasus Nominees Limited and Goodbody Trustees Limited.
UPDATE: 28th September, 2011. The Irish Times today reports that the 3.2 acre Opera site (there’s a nice aerial photograph of the site here) is to be offered for sale by Savills with a guide price of €12.5m (a drop of 89% from the €110m which the property fetched in 2005 when sold by the Sharma-Morrison concern to Jerry O’Reilly, David Courtney and Terence Sweeney company, Regeneration Developments). There is interesting observation that Limerick is the only city in Ireland whose city-centre rents are lower than those for out-of-town sites.
UPDATE: 22nd November, 2011. The Limerick Post was the first newspaper to report that it is the Government that is buying the Opera site for an undisclosed sum. It has not been announced what the site will be used for but Minister Noonan whose constituency includes Limerick city and the Opera site says he is glad it hasn’t been bought by a developer who might simply sit on what would become a derelict site for 10 or 20 years.
The link below states that Sam Morrison was involved in this project. He is a man of considerably greater means that Gary or Suneil. His main company, Corbo, is either the no.1 or no.2 property firm in NI by asset value.
I’m guessing he was investing in this scheme rather than taking the main role as he banks exclusively with BoI – his chief exec is even a former boss of BoI in Belfast.
Even though I haven’t seen him linked with Nama before but this suggests he may be in. Corbo was in effect the entire NI commercial market last year, with a series of disposals. The chief exec insisted they were building a war chest but I suspected they may have been trying to satisfy land and development mortgages.
Of course it’s possible that Sam is no longer involved in the Limerick project – a check of CRO filings might show that.
http://www.shopping-centre.co.uk/news/fullstory.php/aid/1476/Opportunity__knocks.html
oh another NAMA derelict site.. and the city manager wants to get it developed with our borrowed money?
I would recommend that the city manager uses his local authority power – under section 59 of the Planning and Development Act 2000 – to oblige NAMA and the owner to at least secure the site and do any repairs (pay for them too)
Then at least mothball it so it doesn’t get any worse. Find responsible caretaking tenants.
This is a nationwide issue and there has to be some joined up thinking soon or we are going to have increase in dereliction/ vandalsim etc…
The big money for fancy shopping centres is not coming back any time soon… no one has the money to buy stuff either.
Saw Greystones harbour yesterday – hear that may not go ahead , meanwhile the place is just disgusting. Pity as it was such a pretty harbour. Now it’s developer vandalsim.
I take it back about section 59 – that is for “protected structures” and apparently in this development they were to demolish georgian buildings !!
It’s very revealing of NAMA’s attitude towards provincial City Councils that they felt no obligation to provide anything other than a boilerplate NAMA mission statement in response to serious concerns about a prominent derelict site right in the middle of the city. The Council are within their rights to take offence.
It’s clear that NAMA regarded the concerns of Limerick City Council as being beneath the agency (overburdened as it is with assisting developers in transferring assets to their wives). Something tells me they’d jump to a lot quicker if the request had come in from an American or UK city council.
There have also been calls to level the site and turn it into a car park. Personally, I think the City Council should do this by fiat given NAMAs snub against them.
@OMF: ….. “they (NAMA) felt no obligation to provide anything other than a boilerplate NAMA mission statement in response to serious concerns”
I’m glad someone else spotted this. I was beginning to get paranoid! Trying to correspond with NAMA is the ultimate frustration. The anodyne responses one receives, that do not answer the questions asked are straight out of “Yes, Minister”.
It would appear to me that no one working there is allowed to say anything that does not form part of the “Responses Manual”
What a complete shower of morons.
It is a monster of a development a total product of celtic tiger, bubble thinking http://www.operacentre.ie/brochure1.pdf I have been down in Limerick recently. stayed there for over a week. Many businesses are barely hanging on by a thread and nearby Arthurs Quay shopping centre is also struggling. Even the great and inspired little Milk Market also nearby is challenged for customers during the week, save at weekends when it really busy.
Build this and all you will do is cause displacement, it will cause as many businesses to close as open. This is the stark reality that NAMA is going to come up against again and again.
My solution would be for NAMA to disassemble the site as soon as possible and let development proceed at a more organic level. NAMA should not destroy parts of Limerick city by going ahead with this ill conceived and now utterly surplus to requirements development. In reality, like so much of the Celtic Tiger these developments were never needed. NAMA must not be allowed to create urban decay across the whole as it tries to maximises returns by sponsoring development on one of its toxic loan sites.
@Robert Browne: “…. as it (NAMA) tries to maximise returns by sponsoring development”
I promise you, Robert, that the last thing NAMA is doing at present is trying to maximise returns by sponsoring development, or indeed by doing anything to maximise returns. They have shifted firmly into disposal mode – especially in London.
The results of that move, which has only just happened in the past two weeks, will be seen over the next couple of months. But maximisation is out and sales celerity is in – at whatever level is out there.
@ WSTT
I believe what you are saying is 100% right.
So much for LTEV’s, getting credit flowing and avoiding nationalisation of the banking system. They are now spending significant amounts of time in their own boardrooms discussing how they are going to fund the sale of the NAMA loan book.
@Robert: Funny you should mention that. My information is that they have prepared a section of their loan book for sale and that it is being offered to only three parties. All very secret at the moment. (Nothing new in that – nobody can accuse NAMA of being transparent)
NAMA is subject to the code of practice fro the governance of state bodies: http://www.nama.ie/CodesOfPractice.php
and isn’t NAMA supposed to be transparent in disposing of assets? http://www.finance.gov.ie/viewdoc.asp?fn=/documents/Guidelines/codepractstatebod09.pdf
“18.1 The disposal of assets of State bodies or the granting of access to property or infrastructure for commercial
arrangements e.g. joint ventures with third parties, with an anticipated value at or above a threshold level of €150,000
should be by auction or competitive tendering process, other than in exceptional circumstances (such as a sale to a
charitable body). The method used should be both transparent and likely to achieve a fair market-related price.”
@Hume, you are right. NAMA is subject to those guidelines but apparently only when NAMA owns the asset, that is, NAMA has foreclosed and taken possession of the asset which was security for a loan that has gone bad. I know NAMA has generated a lot of news with recent receivership applications, and indeed there are a number of applications at the High Court which haven’t even been reported (seach for “national asset” in the plaintiff field and “2011” in the year field here to get the list – http://highcourtsearch.courts.ie/hcslive/terms_conditions.processAction – I have asked NAMA for comment but have not as yet heard back from the agency).
The point is that NAMA itself has foreclosed on very few companies and assets. Most sales will be by the developer themselves, though under NAMA’s auspices. And it seems to me from studying the NAMA legislation and codes that disposals by the developers – even under NAMA’s auspices – are not subject to any codes. The hope is that NAMA would maximise the return as if it was NAMA that was disposing of the asset. Time will tell if this has happened. Unverified claims like the ones made by Senator Mark Daly would seem to indicate this area might be problematic for NAMA.