The UK commercial property news website, Costar, reported on Friday last that NAMA has exchanged contracts for the sale of an office development site in Croydon, south London with a price tag reported to be GBP 3m (€3.5m). The site was formerly owned by one of Anglo’s borrowers, Magnet Property Investment. The buyer is Abstract Securities, a company controlled by Mark Glatman (photos and profile here), and the intention is to develop a 100,000 sq ft office block on the site.
NAMA generally doesn’t comment on individual sales – the best the Agency will give is an overall total of disposals of loans and property which cumulatively stands at some €4.6bn approved – but you can access the results of the endeavours on here to keep track of NAMA sales reported in the press and elsewhere.
UPDATE: 28th November, 2011. Yes the eagle-eyed amongst you might have linked the reported sale of the site in Croydon which was heavily hit by the London riots in August 2011 and NAMA’s Head of Portfolio Management John Mulcahy’s musings on the causes of the riots when he held forth last month at the annual RESI conference in Wales organised by Property Week and suggested easily portable flat screen TVs were to blame for the riots. You might ask if NAMA’s valuation of the Croydon site sold last week was influenced by its proximity to shops selling household electrical items.
NAMA Wine Lake 
At what stage is NAMA. At with the approval of debtor Business Plans?Has the Agency approved Business Plans for the Smaller Players in the Process and if so would the registration Of Charges by NAMA indicate approval of Debtor Business plans?
@Patrick, the latest I have seen from NAMA is that it expects to have reviewed the top 180 developer plans by the end of this year and also 200 of the smaller-scale developers. So at this stage you might assume that NAMA has reviewed some smaller-scale players. Approval is another matter and NAMA remains tight-lipped on the number of developers’ plans which have been fully approved with formalised agreements (Memorandum of Understanding, Heads of Terms and Final Agreement)
I wouldn’t think registering a charge indicates approval, co-operation or anything else. It just represents NAMA’s caution in ensuring its interest is registered and I have noted before that NAMA has registered charges against properties whose owners are understood to be co-operating with the Agency.
So this would not Indicate any from of Co operation but is a first Step in the Process?This would be a Construction Company with Loans Totalling around 30million from Irish Nationwide, Bank of ireland and Ulster Bank.Would the above figure suggest that NAMA has approved debtor Business Plans?
@Patrick, I would have said that a €30m exposure would be one of the smallest NAMA developer exposures. Remember there’s a €20m min threshold at AIB and BoI, €5m at Anglo and none at INBS/EBS. However there’s no confirmation that NAMA is dealing with business plans according to exposure. And NAMA might have leapfrogged larger-scale developers if there was a smaller-scale developer (eg €30m) with a more straight-forward business plan.
Long way of saying, we just don’t know.
@NWL does NAMA make available transcripts of addressees that it’s in house experts make at public forums.Assume the tab for all entertainment and travel,registering for the conference,etc. was picked up by the Irish taxpayer.He appears quite the jovial type,are NAMA senior executives allowed accept dinners,drinks,hospitality from potential clients,perhaps it’s a way of saving the taxpayer a few bob.
It was my understanding that the above expert worked for a “commercial” shop,was curios on the choice of subject matter.
@John Gallaher (you’ve changed email addresses?) NAMA doesn’t generally post transcripts of addresses by anyone at NAMA save Brendan and Frank. However the RESI conference organisers/Property Week might be able to help, but my limited enquiries didn’t result in any success.
There’s no register of hospitality or gifts provided to NAMA staff. Nor, I understand is there a register for our TDs and Senators.
@NWL typo new IPad,apologies,but I like the green better !!!!!
I actually searched the site myself,was unable to locate it.
He does not appear the type to pack his lunch,or play solitaire in the evenings.
Perhaps,if and when FOI comes in we can have a peek at the travel expenses.
There was no breakdown in recent NAMA report,hopefully his preparations for this conference,was not too much of a distraction and did not involve any other staff members researching or assisting.
Apologies,some limited research revealed that John M. Is in fact eminently qualified to pontificate in Wales on the following topic.
“New partnerships for residential investment”, alongside Grosvenor chief executive Peter Vernon, Grainger executive director Nick Jopling and Allsop insolvency partner Simon Davidson.” link above.
The caffeine had not kicked in,I overlooked,forgot John M.’s pivotal role in the “Glass Bottle Site”,he must have “gained” some “valuable” insights that he shared with a very select audience at that jaunt.Unfortunately,I was working and unable to attend,perhaps he did some site inspections of the NAMA portfolio in Wales !!!!!!!
“In October 2000, our client South Wharf plc put together a multi-disciplinary team comprising lawyers, town planners, architects, tax advisors and members of the Jones Lang LaSalle team. Our brief was to advise on, and resolve, various legal and planning-related issues to enhance value.
Between 2000 and 2005, we met regularly with the client to provide strategic advice on a range of issues. We also produced a masterplan which took into consideration issues such as likely end-user demand, known requirements, likely competition, future demand drivers and the anticipated development programme. We also suggested ways in which the site could be re-branded – shifting the focus of attention away from the Dublin Port area and re-focusing it on the Sandymount area where more expensive property prices prevailed. ”
The Jones Lang LaSalle team showed remarkable prescience in their advice to wait until such time as a suitable exit strategy could be implemented, and to market the property after, rather than before, the land value of the site was enhanced. The decision to exit at the top of the market was well and truly vindicated. Just a few months after the sale, development land values declined dramatically due to a combination of a slowdown in the Irish residential market and the international credit crunch.”
Skills such as prescience,exit at top of market,vindication may have been shared with his rapt audience,any chance the Irish Taxpayer who paid for this trip,unless he was “sponsored”,could take a look at these words of wisdom.
http://www.joneslanglasalle.ie/Ireland/EN-IE/Pages/CaseStudyDetail.aspx?ItemId=215
@John, I think you are being unfair on John Mulcahy, who as far as I can see succeeded in getting his client (the seller of the IGB site) a good price. And from recollection, the losing bid was around €350m, so to the extent that a valuation is what a willing buyer and willing seller agree with both having access to perfect information, you can see that the €412m sale price of the IGB site was in the ballpark of the losing bid. Certainly both bids are far in excess of what the decontaminated site is worth today (about €50m according to the DDDA accounts)
And in terms of the suggestion of John Mulcahy’s role as valuer in the IGB case, a NAMA spokesman has previously stated that John did not value the IGB site.
But Paddy Kelly has claimed that it was John Mulcahy who “signed off” on Burlington Plaza being worth €350m. But in fairness that was what it was worth in the sense of what willing buyers and sellers were prepared to agree.
https://namawinelake.wordpress.com/2010/07/24/burlington-plaza-burlington-rd-2007-%e2%80%98who-signed-off-on-that-as-being-worth-e350-million%e2%80%99/
@NWL a planes,trains,automobiles,day.
Will follow up later,my issues on the deal was the ‘horse and carriage’ that was driven fast through an obscure Landlord and Tenanat law.
Unfortunately,not currently in position to link,back this up.
But will later,you may have covered it on the site elsewhere.
@NWL his ‘client’ was ONE of the sellers,previously a tenant.
@John, so? Although NAMA seems almost embarrassed about John Mulcahy’s involvement in the IGB site, as far as I can see he acted very well indeed for the seller; the sort of person you’d like to have on the inside of the tent…
Or attending conferences in Wales,rubbing shoulders with customers,commenting on causes of London riots.
@NWL quite a “big” tent you are building over,if memory serves me the “loser” on the landlord and tenant loophole was the Irish Taxpayer.
@John, again so what? John Mulcahy acted for the seller and did what now looks like an incredible job of achieving a €412m overall price for the IGB site with the vast majority going to the seller represented by John. That’s the sort of talent you’d surely want acting for you, if you were NAMA.
What has the subsequent loss to the taxpayer got to do with the advice of John Mulcahy to the seller at the time? Maybe if the DDDA had John Mulcahy acting for it, it wouldn’t have embarked on what now looks like one of the dumbest property development investments in Irish history.
@NWL it was ‘hesit’ plain and simple,legislation had to be introduced afterwards.
wheels up … will link,back up,later.
@NWL apologies about to “take off” and WSTT flying commercial these days !!!
I think Matt Cooper in one of his excellent books had great piece on this.
http://www.amazon.com/Ireland-Really-Went-Bust-ebook/dp/B005HHSXUK
Will find it later,you may have covered it.
@john gallaher, The taxpayer losses in the landlord and tenant act loophole in the case of the IGB site were the dopes in the Attorney General’s Office in the Department of Justice, who drew up the amending legislation and left the Port and Docks out of it. Civil Service incompetence once again. Can’t blame it on John Mulcahy this time.
@WSTT/NWL good piece this weeks Barrons on ‘what Europe can learn from Ireland ‘ behind paywall.
Of course delayed !!!!
@john gallaher; Barron’s feature Article below:
Ireland’s Turnaround Offers Hope for Europe
By JONATHAN BUCK
After a banking crisis and bailout, Irish leaders resolved to repair their broken economy. They aren’t done yet, but their strategy offers important lessons for Greece and others.
As Italy and Greece stumble through their sovereign-debt crises, they might find encouragement—and lessons—in Ireland’s tentative recovery from its own near-death experience of several years ago.
Ireland was forced to nationalize almost all its banks in 2009, after a real-estate bust left them saddled with unmanageable debt. As borrowing costs soared, however, the burden proved too much to bear for the nation of 4.5 million people. Last year Ireland received a bailout to the tune of 67.5 billion euros ($90.1 billion) from the International Monetary Fund, European Union and European Central Bank, and the country agreed to implement reforms, including spending cuts and tax hikes, to restore confidence in its banking sector and public finances.
Just one year later, gross domestic product is on track to grow 1.1%, after falling 10% in real terms and 18% in nominal terms between 2007 and 2010. Economists see another 1.1% gain next year, although export growth is fueling the expansion while the domestic economy remains weak. Stripping out exports and inventories, GDP will slip 3.1% this year, according to Eurostat, the European Union’s statistics office. Still, that’s a notable improvement over the declines of recent years.
Alone among Irish banks, Bank of Ireland avoided nationalization. Instead it found a rich Canadian investor.
Ireland’s resolve to reform reflected its government’s determination to fulfill the country’s obligations to creditors and pay its own way. Greece, in contrast, has been dragging its feet on reforms even after creditors agreed to take a 50% haircut on the principal they are owed, while Italy, too, has been slow to address its problems.
Ireland’s commitment hasn’t been lost on lenders. It pays interest rates of around 8% to borrow in international money markets, down from a high of about 14% earlier this year. The price is steep, especially compared with a rate of around 2% for Germany, the euro zone’s benchmark, but the drop reflects the progress Ireland has made in fixing its economy.
Irish politicians across the political spectrum are on board with the plan, in stark contrast to the posturing and divisions in governments in Southern Europe, which have been forced to turn to technocrats to push through unpopular reforms. Austerity in Ireland has been greeted with an air of resignation rather the protests and strikes that have met similar measures in Athens and Rome.
“We know we messed up,” says Joe Durkan, an economist at Ireland’s Economic and Social Research Institute. “We messed up in the ’70s and ’80s and we were determined not to do it again. But we made new mistakes.”
Ireland’s bust followed a decade of runaway growth, after the country successfully shifted the focus of its economy to technology from agriculture. In the 1990s, with a combination of lower corporate-tax rates and subsidies, the country attracted multinational companies looking to establish a foothold in Europe. Investment flowed in and growth accelerated, aided by low interest rates set by the ECB. As wages climbed, citizens funneled their wealth into real estate, fueling a construction boom. But when lending began to tighten, real-estate prices collapsed, leaving the banks with losses.
The Road to Recovery
Although Ireland pays a lot more than its stronger neighbors to borrow money, it pays much less than it did in the summer. GDP is likely to grow 1.1% this year.
The Irish government responded aggressively, guaranteeing payments on as much as €440 billion in bank debt, at that time twice annual GDP. As a result, government debt soared from 24.9% of GDP in 2007 to 94.9% in 2010, above last year’s euro-zone average of 85.4%, according to Eurostat.
In hindsight, taxpayers need not have shouldered the full liability and the banks could have been allowed to fail. While that would have been painful for investors, economists argue that it no longer matters whether banking services in Ireland are provided by institutions in Dublin or Frankfurt.
IRELAND’S BANKS REMAIN UNDER government control, and the ECB had lent them €100.9 billion as of the end of October. Nonperforming loans, many secured by properties in the United Kingdom as well as Ireland, were pooled in 2009 into another government-run vehicle, the National Asset Management Agency. Less than a quarter are now performing, reflecting drops of 60% in commercial property prices and 44% in residential prices. The Bank of Ireland (ticker: IRE) was the only bank to avoid nationalization; instead, it attracted a €1.1 billion investment from a group led by Canada’s Fairfax Financial Holdings (FFH.Canada).
The Irish Stock Exchange has tracked the disintegration of the financial sector, with its broadest measure plummeting more than 70% since the start of 2007. The economic impact of the crisis has been equally severe, with unemployment expected to peak this year at 14.4%, up from about 8% of the working population in 2007. Joblessness in turn has sparked a surge in emigration. Private consumption is forecast to decline 2.4% in 2011 as households tighten their belts and repair their balance sheets. But exports are expected to jump 4.5%, as foreign companies operating in Ireland are concentrated in defensive industries such as food and pharmaceuticals.
The divergence between the weak domestic economy and a growing export economy will last at least through 2012. Thereafter, employment growth and a decline in private savings are expected to boost domestic GDP.
Greece, Italy and its debt-soaked cousins might well consider Ireland’s resolve. “We have done a lot to date, but there remains a lot to do,” says Brian Devine, chief economist at NCB Stockbrokers in Dublin.
Ireland, at least, is on the right road.
Off topic, but reading the above, you’d have to ask “Ireland’s Turnaround”? What turnaround? “Resolve” and “on track to grow 1.1%” – after falling 10% in real terms and 18% in nominal terms doesn’t put us in a recovering economy category. And 8% on our 10 year bond? I’m borrowing for less than that and I’m no small credit risk!
Also, In Ireland we had overextended banks and a real estate bubble, not massive sovereign debt and a lack of ability to collect taxes. So, I’m not sure what lesson is to be learned from Ireland by the rest of the Eurozone other than an austerity programme without growth won’t work. But that’s a lesson for the future.
@WSTT-my personal favorite is below,good lads…..
Austerity in Ireland has been greeted with an air of resignation rather the protests and strikes that have met similar measures in Athens and Rome
A few resignations would be appreciated !
Another way to say conflict of interest !
UORR:
‘the €750million sale-and-leaseback of AIB’s Bankcentre’
http://www.joneslanglasalle.ie/Ireland/EN-IE/Pages/InvestSalesandAcquisitions.aspx
“The Serpentine Consortium was named preferred bidder after an open tender process handled by Jones Lang La Salle, the estate agent which is understood to be handling the new sale and leaseback”
http://www.independent.ie/business/irish/aib-set-to-put-ballsbridge-hq-on-market-for-360m-120452.html
Did John Mulcahy step out of the room,attend a conference when NAMA was ‘analyzing’ in detail its position on UORR.
@NWL we are discussing different ‘transactions’ undoubtedly the sale was an absolute home run,knocked the ball out of the park on that one.Can only imagine the closing party that Coulson threw.How Coulson ended up being a seller is what interests me.Jones Lang was his property advisers,hes an x tax account,NOT an expert on landlord and tenant.
Does ‘conflict of interest’ step out of the room,go on a boon-dangle,when NAMA is discussing the IGB site?
‘By 2002, the glass plant was owned by Ardagh Glass, which was headed by former tax accountant Paul Coulson…’
‘South Wharf, apparently alerted to the news of the loophole, by Martin’s amendment, offered to buy the fee simple of the Ringsend site for 5% of the commercial value’
‘South Wharf made €274 million from a lease, while the freeholder – – the taxpayer — could be in hock for hundreds of millions of euros’
http://www.finfacts.ie/irishfinancenews/article_1018415.shtml
These are only a ‘few’ of the highlights,was on vacation,limited access via IPad no access to ‘library’ which is at home.
Could NAMA provide a ‘list’ or maybe a ‘book’ on all the transactions now under its ‘wing’,that John Mulcahy and his old ‘shop’ worked on/advised clients.
Does he leave the room or country when NAMA is discussing these,perhaps that explains his attendance in Wales, because I can not think of any other good reason why he is wasting Irish taxpayers money in WALES.
If he has to keep leaving the room because of glaring ‘conflicts’ is the jovial John M. the right man for the job !
http://www.finfacts.ie/irishfinancenews/article_1018415.shtml
@patrick; NAMA appears to have changed tack with regard to developers’ business plans. They now routinely reject them as they do not want the contractual commitment.
Instead they offer a “sop” of a generic “letter of support” which is a quarter-by-quarter (3month rollover) agreement that NAMA can abort at its whim.
You have to think like a civil servant to understand it. The question is “why do the debtors accept it?” The answer is probably “what’s the alternative?”
It all leads to an undercurrent of mutual mistrust and cynicism, with the debtors just awaiting their opportunity to turn the tables on their overlords.