Revealed in NAMA’s report and accounts (note 8 on page 9) for its latest reporting period, quarter one of 2011, is a charge of €825,000 for “lease fit out costs”. It’s not a cost incurred with one of its loans or developments and it is assumed that the cost relates to changes made at NAMA’s offices at the Treasury Building on Grand Canal Street in central Dublin (2007 brochure for the building here). NAMA has leased the building from developers Paddy McKillen andTreasury Holdings. Due to annual leave, NAMA might not be able to provide further information on this charge for some weeks, so this entry will be a bit of diversion with conjecture on what the €825,000 might have bought. Here’s 10 suggestions.
1. A gym. NAMA CEO Brendan McDonagh was recently reported to be working 70-75 hour weeks. Sitting behind the desk 10 hours a day or in a meeting room and grabbing the odd snack can’t be very healthy, so maybeTreasuryBuilding needs a decent gym. That wouldn’t account for €825,000 though. Maybe they’ve installed a rooftop swimming pool as well?
2. De-stressing facilities. Perhaps stress balls and watching the spheres in aNewton’s Cradle just aren’t enough any more, and perhaps the over-worked NAMA management have installed more industrial facilities to help them relax. Lord knows NAMA should be familiar with such facilities with the extensive spa amenities tacked onto many of the 83 hotels now controlled by the agency inIreland.
3. Enhanced co-operation devices. It seems to be now established that some developers are just not playing ball with NAMA, and are still stuck in the old mindset. God knows, NAMA has said it often enough. So perhaps argument and persuasion have reached their useful conclusion and perhaps more extreme measures are needed. Could a conference room be turned into a water-boarding suite? Iron maidens don’t take up much room. A rack might do the trick though it mightn’t deter certain developers who feel a little self-conscious about their height. A refusal to reverse a transfer to a spouse? The Tucker Telephone might encourage co-operation by curing developers of any future physical attachment to said spouses.
4. Covert surveillance. Developers who enter the premises to negotiate business plans might find themselves unwittingly compromised with hidden surveillance, be that listening devices in the washrooms and elevators or perhaps CCTV and external listening devices to capture conversations outside the building, not to mention photographing developers’ mode of transport. It might be best to ditch the Mercedes and turn up atTreasuryBuildingin a sensible Volkswagen – you never know who might be watching.
5. Anti-surveillance. Didn’t the Russians, or maybe it was the Chinese, perfect technology to acoustically interpret vibrations on window glass caused by conversations within a building. Was it laser or microwave technology they used? Regardless, NAMA might have upgraded the security of its own building, and the information stored and communicated therein. Maybe it’s an urban myth that with just an empty tube of Pringles and a wire coat hanger, attached to a laptop that you can infiltrate a wireless network, but NAMA might be taking precautions anyway.
6. Protection. Last year the “toxic bank avenger”, developer Joe McNamara, took his frustrations out on the gates of Leinster House. But how long before developers switch their attention more directly to their tormentors at theTreasuryBuilding? Concrete bollards to prevent truck bombs won’t be cheap but will be a bargain compared with bullet/blast proof glass for the building. Perhaps the senior executives now have panic rooms constructed in case any developer runs amok on the premises.
7. Wallpaper. In 1998 the British Lord Chancellor was embroiled in a scandal after it emerged he had spent GBP 650,000 decorating his public office flat. That included GBP 59,000 just for wallpaper; “you are talking about quality materials which are capable of lasting for 60 or 70 years” Derry Irvine sniffily said at the time. Now we know that NAMA has a publicized life-span of just 10 years but judging by its first year, it may take longer than that for the agency to turn a profit. Has anyone seen the wallpaper inTreasuryBuilding recently?
8. Housing the NAMA Art collection. In May 2011, NAMA amazed us all by donating a €300,000 painting, previously snaffled from developer Derek Quinlan, to the National Gallery. It was “a goodwill gesture to the National Gallery and to the Irish people” said NAMA grandly at the time. You can see a photograph of NAMA chairman, Frank Daly discussing the painting in situ at the gallery here. Perhaps NAMA’s management no longer wants to schlep over to the National Gallery to appreciate its art collection.
9. A special room for unsigned developer agreements. It’s now 15 months since NAMA acquired the first tranche of loans, and as of one month ago, only one agreement with a developer was “close to finality”. The NAMA CEO told an Oireachtas committee last year than an agreement comprised three document stages – the memorandum of understanding, the heads of terms and the final agreement. And each needs to be signed by NAMA and the developer, and potentially the developer’s wife. Yesterday, Northern Ireland’s finance minister called on NAMA to get a move-on with settling these agreements as the uncertainty was jeopardising businesses. Now that NAMA has acquired the loans of 850 developers, the agency must have a very big stock of unsigned documents.
10. Time-machine. Ah yes, if NAMA could only go back to May 2010 and write two letters, instead of one, to the Department of Finance. We know about the one warning of the effect of abolishing Upward Only Rent Reviews in commercial leases but alas NAMA didn’t write to the Department to inform it that it was changing the valuation date from 30th November because the evidence was that Irish property prices were still tanking, and asking for an amendment to the Long Term Economic Value regulation so that the agency might have been able to take account of information available after January 2010. If only NAMA had written such a letter, it mightn’t have just turned in a €1.1bn loss for 2010 with the prospect of a similar loss in 2011.
The more serious question is why NAMA has spent €825,000 on what is a relatively modern, third generation office building given the agency’s publicised lifespan of a further six to nine years. The building already has air-conditioning, raised floors and suspended ceilings. Perhaps NAMA will let us know in a few weeks.
NAMA Wine Lake 