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Archive for January 2nd, 2012

This is part two of a political review of 2011, prompted by interference of government in everyday economic and social life as it struggles to balance the budget and deal with the banking crisis.

First up today, a few spot prizes

Blogger of the Year: with the expansion of the internet, it is still surprising to see this tool under-used by politicians – maybe political success still derives from knocking on peoples’ doors. Or maybe party politicians rely on the party machine for press. Gerry Adams was an early adopter of blogging and his leargas blog continues to stand out for its personal and political commentary. You’d expect the Independents to rely most on the internet given the lack of party support and funding, but apart from Stephen Donnelly there’s very little of note from the others..

Bogger of the Year: Luke “Ming” Flanagan for services to the turbary sector, though some local constituents in Roscommon suggest there’s more than ferns growing on Ming’s plot

Vicky Pollard (“Yeah but, no but, sumatanothin”) award for talking utter bullsh*t at high speed: Damien English for a number of contributions; this would be representative of the usual standard from the Vincent Browne show on 10th February “[Damien, if Fine Gael forms part of the next government, will Fine Gael assume this loss and get the rest of us to pay for it?] No, Fine Gael have very clearly said that we’re not putting any more money into banks until some sort of burden-sharing arrangement is reached, it’s as simple as that. Before these figures that NAMA put out yesterday and today, and these other figures we have now tonight as well, the discussion still over the €25bn, you know, whether we commit that or not. Fine Gael has said even with that figure we’re not, that money should not go into the banks until some form of arrangement is , that there is burden sharing or some other way so you don’t crystallise the losses, we are against  the notion of fire-saling of assets because you’re crystallising the losses, people have said that, you’re going to have more losses coming to the front if you sell off these assets [which assets are you talking about?] the assets of the banks, and the various loans, some of their assets are quite good like tracker loans and so on. One of the notions that we put to Europe consider using the assets and the loan money against the assets and hopefully some of these assets will not crystallise losses in the future, they might turn into-, there might be less of a loss there but you still have to, you have to find ways to prevent putting in tax-payers money now because we can’t afford it, and we’re unwilling to commit it there”

Windbag of the Year: Mary O’Rourke for her contribution to the crucial debate on the 2011 Finance Bill (that was the Fianna Fail/Green Party bill to enact the measures announced in Budget 2011 in December 2010). There had been bitter exchanges across the Dail beforehand about the time allocated to debating the Finance Bill. So you might have expected every contribution to the debate itself to have been pithy, well-considered and above all, relevant. Here was Mary’s 15-minute ramble about life in general and the joy of geriatric sex in particular.

Dail Etiquette

When An Taoiseach Jack Lynch went to meet Margaret Thatcher inDowning Streetin 1979, he wore a top hat. That was 30 years ago, but still, it gives you an idea of the formality of attire in politics. In 2011, the notion of traditional attire in the Dail was challenged as a raft of Independents and left-wingers swept into position. We had a reminder from across theIrish Seain August 2011 of how much our dress codes had changed when the Prime Minister David Cameron expressed displeasure towards a jacketless member of parliament.

Back here. TDs like Richard “even my jim-jams have epaulettes” Boyd Barrett and Mick “in 1997 I left a red sock in the wash with my whites and I’m not a man to waste good clothes” Wallace were amongst a number that ignored the traditional dress code of a jacket and tie for male TDs. It wasn’t just the men though as Mary Lou “are YOU staring at my cleavage. And why NOT?” McDonald demonstrated. And looking around the chamber, you couldn’t help but notice the transformation in character of the national parliament. Even Mattie McGrath’s loosened tie, Stephen Donnelly’s tie-less open-shirt neck, Gerry Adams’ rolled-up sleeves or cast-off jacket somehow diminished the traditional standing of the chamber,.

Does it affect a politician’s integrity, honesty, hard-work or cleverness? Of course it doesn’t, but it’s not about the individual politician’s qualities, it’s about the perception of respect they have for their audience of constituents, both locally and nationally. Being a “man of the people” – and it is mostly men that flout the tradition – shouldn’t mean that the Dail is not treated as a place of business. You can’t help notice the contrast between chartered accountant and banking expert Peter Mathews who straightens up, humbles his demeanour and bows in the direction of Ceann Comhairle when he leaves the chamber and on the other hand Richard Boyd Barrett who bounds down from the back-seats, hunches his back like a threatened stray moggy and scowls at An Ceann Comhairle as if to say “what are you looking at, mush”

Outside the Dail, well just as Samantha Cameron sports a dolphin tattoo, standards are different and I can’t imagine Richard Boyd Barrett at the head of an anti-austerity march orchestrating the mantra “they say cutback – we say fight back!” with a shirt and tie.

Gaeilge

2011 was the year that Labhar as Gaeilge became a common feature in the Dail. Previously, in common debate, we’d have the very odd sentence or words spoken in the mother tongue, but from 15th March, Gerry Adams made a point of slipping in a few sentences in Leaders Questions which somehow felt natural. On that first day, An Taoiseach Enda Kenny responded in English but the next Leaders’ Questions on 22nd March, Enda was ready for the novelty and responded in fluent yet somehow laboured Irish, as if there was a tussle as to who could be more Irish. Apart from Gerry Adams versus Enda Kenny exchanges however, there is little sign of the language establishing a foothold in the chamber.

Which in some ways is a pity; because you’ll notice that when Irish is spoken, the ya-boo shouting matches fall silent. My theory is that most TDs are either so rusty in speaking Irish that they have to listen attentively to understand what is being said, or otherwise they have practically no idea what is being said and don’t want to appear stupid by guffawing at the wrong word.

I have a feeling though that the use of Irish in the Dail will slowly increase. Which might mean intensive language classes for some TDs, unless there’s a decision to invest in simultaneous translation.

Politician of the Year

And so finally we come to the award itself. The introduction to yesterday’s blogpost outlined the difficulties in assessing performance but here’s the namechecking of some of the decent performers during the year. There are a number of Young-Turk FG and Labour backbenchers who have publicly demonstrated considerable communications skill, possibly the best example is Paschal Donohoe for his performance on the Vincent Browne show where he puts you in mind of the piggy with the brick house – Vincent can huff and puff, and in Joan and Connor’s cases he blew their houses down and bear-baited accusations of haranguing or threats to back off, but Paschal gives direct answers which blend humility and strength together; it’s very entertaining but the serious point is that Paschal can deal with the wiliest of inquisitors. Pearse Doherty for his national work-rate and promoting alternative economic strategies; he still has a ways to go, because even at the end of 2011, many would regard Sinn Fein’s economic strategy as “hare-brained”; unfair perhaps, but that is a challenge to overcome. Michael McGrath has bucked the trend in what seems like a party suffering Post Traumatic Stress Disorder and he has produced a couple of useful bills on personal insolvency and financial regulation, and it might be with such initiatives that Fianna Fail regains some ground. Michael Noonan is practically the most experienced politician in the Dail by reference to the length of his career and the posts he has held and given the poor hand of cards he has been dealt, has probably done far better than might have been expected; still we are facing into years of austerity and arguably an unsustainable burden. Gerry Adams delivered his party to its best ever showing in the Dail, and it no longer looks like the Peoples Front of Judea at the amphitheatre – more like the Judean Peoples Front; the problem is that he has looked too statesmanlike when debating trolley issues in the local hospital and seems to lack the instinct for the cut-and-thrust, parry-and-riposte nature of Dail politics though leading his party out of the Dail on 2nd November was the political highlight of the year. Peter Mathews campaigned as a Fine Gael candidate and he became a FG TD, he claims he has had lots of private chats with senior ministers but somehow the pre-election “Peter Mathews, Banking Expert” seems to be struggling to find traction in this administration. Joe Higgins and the United Left Alliance politicians should be gaining more ground in opposition to unpopular austerity, and the policies of a centrist coalition but they need improve the quality of their alternatives – a good example is the proposal for a wealth tax, which will probably be necessary but it will need be based on facts not aspirations; see Seamus Coffey’s most excellent blogpost to see the difficulties and information deficit which will hamper proposals. An Ceann Comhairle Sean Barrett has had a successful year as he patiently chairs the business in the chamber, and if you listen very very very carefully you’ll hear most of his interventions have an almost silent sequitur – “ye little pup, ye” The four TDs on the naughty step, having lost the party whip, Denis Naughten who voted against the closure of Roscommon A&E, Willie Penrose over the closure of Columb barracks in Mullingar, Tommy Broughan who voted against extending the bank guarantee and Patrick Nulty who voted against Budget 2012 all deserve a mention because they voted in line with commitments or principle; it is a shame that a party whip system automatically excludes such dissent. The Independents are a mixed and colourful bag, but as individually talented as they may be, it is difficult to see how they are making any practical difference at a national level. On the other end of Leinster House, it has been frankly difficult to discern any real difference made by the 60 senators in the Seanad and it is not easy to find defenders of the Seanad who don’t have existing or vested interests. We rarely hear about our politicians in Europe but Nessa Childers opposition to the appointment of Kevin Cardiff to the European Court of Auditors was noteworthy, as indeed was Proinsias de Rossa’s defence of the nomination of the controversial figure to the plum €276,000 a year post. And finally we come to the two most powerful men in government; Eamon Gilmore has had a lousy year and after a General Election victory of sorts and agreeing terms to a coalition government, seems to have done little beyond pissing off the Vatican. But it is Enda Kenny that gets most attention; having fended off a heave in 2010, he fought an election campaign that saw his party returned with a record complement tantalisingly close to a majority; he has spun the silk which has bound the coalition in reasonable harmony for the past ten months despite the odd hiccup and suggestions of friction; he expressed the feelings of a sovereign republic in attacking the Church’s record on child abuse and he was generally a nice person. Having said that, he upset our partners in Europe early on, according to Channel 4 reporter Faisal Islam which might have cost us millions; he disgraced us with a woeful speech at the White House on St Patrick’s Day, he failed to establish any traction with the main players in Europe, he lucked out on Greece’s travails which led to Portugal (without concessions) and Ireland (with tax concessions) getting interest rate reductions. He demonstrated a poor economic and political understanding when he dismissed the repayment of Anglo bondholders as payment from “Anglo’s own resources” and during the Kevin Cardiff debacle he undermined confidence in his ability to lead; and we are still left wondering if he spent most of his time at the last European Peoples Party pre-EU summit meeting in Marseilles trying to convince his colleagues to take that great lummox off our hands, instead of pushing the message that Ireland is facing into unsustainable debt and negative-spiral austerity. In short Enda has been mediocre in the past ten months, and whilst men can find greatness with power and the office of An Taoiseach is not an X Factor contestant’s or Premiership manager’s role, Enda will need demonstrate better abilities in the months to come.

So, in summary the Politician of the Year award is withheld for lack of merit.

Looking ahead to 2012

Will there be a reshuffle? The Young Turks (some of whom aren’t all that young) are champing at the bit for a chance to shape events at this historic juncture. Ministers Shatter and Hogan have not had a good 10 months. Michael Noonan might benefit from a more contrarian junior minister than Brian Hayes. And is there anything to stop Finance having two junior ministers, perhaps a second responsible for banking. And does Gaeltacht Affairs really need a junior minister at all?
And what about Enda? He announced just before Christmas that he was going to assess his ministers in March 2012 and publish the results. Great, and it garnered a couple of positive headlines ahead of the Christmas holidays. But what happens if Joan Burton or Roisin Shortall for example is found wanting, what can Enda do about her without Eamon Gilmore’s input. And will the great moderniser Enda be open to a 360-degree review whereby his ministers give their own assessment of the boss’s performance? February 2016 is only 50 months away, FG knows what it is like to be out of power for 14 years and the course presently being charted by the Government may mean there is a vengeful electorate yearning for the opportunity to repay the incumbents for austerity, anaemic growth, lousy public services, high unemployment and empty place settings around the dinner table.

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“If past history was all there was to the game, the richest people would be librarians”  Warren Buffett

Last week, there was a preview blogpost for NAMA in 2012 which is the future where riches lie, and this is the librarians’ review of NAMA in the past 12 months, divided by month.

January 2011

In December 2010, the NAMA CEO and the Financial Regulator were each doing their damnedest to pass the buck for the iffy information provided by the banks to NAMA and its advisers in mid-2009. The NAMA CEO had characterised the information provided by the banks as touching on fraud. The Committee of Public Accounts wanted to pin down the culprits for NAMA getting its initial business plan so wrong. So it hauled Brendan and Frank back on 14th January to explain themselves. Sadly the committee was not equipped to closely question the pair, and it remains the case to this day that no-one has been held to account for the poor quality of the draft NAMA business plan. Separately speculation about NAMA’s acquisition of sub-€20m exposures at AIB and Bank of Ireland intensified as the Fianna Fail/Green coalition teetered on its final legs and a general election was announced by Taoiseach Cowen in the Dail on 20th January; on 24th January, the NAMA Amendment Bill was published, and was promptly binned a month later; surely AIB’s lobbying of the Department of Finance had nothing to do with the decision. NAMA was in the courts to stop a property on Kings Road in Chelsea in London being transferred by Thomas and Patricia Joyce to their children. It was revealed that a solicitor on NAMA’s legal panel, Brian O’Donnell was being pursued for €69m by Bank of Ireland; although the story had a whiff of scandal about it, NAMA was quick to say that no work had in fact been given to this solicitor. On 24th January, it was announced that David and Frederick Barclay had bought into the Maybourne group of hotels. On 25th it was exclusively reported here that NAMA was overseeing the sale of the Montevetro office building in Dublin to Google.  Not for the first time, Kerry senator, Mark Daly made accusations about NAMA’s disposal of assets; he appeared on the Pat Kenny radio programme but steadfastly refused to provide details which would allow his claims to be investigated.

February 2011

Paddy McKillen, the property investor (or “developer” if you want to rile him) achieved a score draw at the Supreme Court which ruled that NAMA was indeed required to consult with him before acquiring his loans, and that NAMA’s decision to acquire his loans before the Agency was legally created was flawed. It was a draw because the Court ruled that NAMA had the right to acquire his loans. Despite the 2-2 draw by reference to the issues considered, NAMA ended up with a legal bill estimated at €7m ( NAMA keeps batting away specific questions on the precise costs by claiming not all the costs are in yet). Seperately NAMA had administrators appointed to companies in the Beetham Organisation in the UK which was developing commercial space on the edge of the City of London. It was reported that there were some €5bn of NAMA “objector developers”, understood to be mostly from Northern Ireland and which included Paddy McKillen, who didn’t want their loans transferred to the Agency created by the Dublin government. In a portent of the loss to come, it is announced that NAMA will not pay interest on its subordinated bonds which it used to fund 5% of the acquisition price of loans. NAMA confirms the sale of the Montevetro building to Google for €99.9m, and it is exclusively reported on here that NAMA scores a success when loans on an apartment development building in London’s Grosvenor Square is to be refinanced by British tycoon Richard Caring. Fine Gael looks set to form next government after winning most seats in the General Election on 25th February, and major changes were expected for NAMA given the commitments and statements made during the campaign – in the event, none have yet to leave the drawing board.

March 2011

It was reported that NAMA had sold the former Liam Carroll HQ on Parnell Street to Penney’s for €25m. Fine Gael and Labour enter into a coalition agreement and further loan acquisitions, specifically the sub-€20m exposures at AIB and Bank of Ireland – by NAMA are scrapped.  Anglo’s CEO, the €974,000-a-year Australian Mike Aynsley takes a pot shot at NAMA’s “execution” in an interview with an Australian newspaper. NAMA wins a key court case in the UK where it is held that the Carey group cannot prevent the Agency taking over its loans. NAMA awards an IT contract to Ergo Services to deliver a “portfolio management system”.The NAMA chairman, Frank Daly delivers a speech to the, ahem, Licensed Vintners Association in which he claims that residential property had declined by 50% from peak when NAMA valued it by reference to 30th November 2009. Veteran gentleman developer, Paddy Kelly became the first of many prominent scalps to be claimed by NAMA and its receivers in 2011, as NAMA appointed property receivers to 11 assets principally associated with the Laois-born developer.

April 2011

It is reported that NAMA has started investing in Irish government bonds. Just a treasury management exercise claims NAMA but given the volatility of Irish bonds in 2011, many felt NAMA was going off in on a dangerous tangent. As it happened, NAMA sold the bonds a few months later and made a profit. NAMA touted the concept of providing some form of mortgage assistance to residential buyers to get around the moribund domestic housing market, the concept later transmogrified to the negative equity mortgage product which NAMA is set to launch imminently (it’s been deferred at least once, and it is known that the Government has expressed reservations about its potential to distort the housing market). It was reported that NAMA had sold a shopping centre in Blackpool in northern England for €112m – half the size of Dundrum Town Centre but with a similar footfall, yet Dundrum was said to be worth more than €500m.NAMA appoints receivers to Derek Quinlan properties. Minister for Finance Michael Noonan bamboozles us by claiming that NAMA will not be taking over sub-€20m exposures at AIB and Bank of Ireland because the “assets would be geographically scattered”. NAMA appoints receivers to Capel Developments. And another of the Celtic Tiger’s roaring personalities, Jim Mansfield succumbs to NAMA’s receivers also. The P Elliot group follows the descent into receivership soon after. On 27th April, NAMA initiated a saga with the Grehan brothers from Galway, as it appointed receivers to companies and assets in Ray and Danny’s group, reportedly after relations soured between the developers and NAMA when NAMA sought to have Harry Slowey appointed to a role in the Grehan group. This foreclosure in particular has been the most bitter, eventful and problematic to date, with personal judgments, worldwide court orders and Ray Grehan becoming the most vociferous critic of NAMA with attributed comments in newspapers and an appearance on an RTE Prime Time special on NAMA. Finishing off April came news of yet another receivership, this time to a landmark €225m property onLeicester Square inLondon belonging to Pat Whelan’s Steamboat Developments.

May 2011

May started with the latest episode of the Grehan saga and NAMA “standing down” its receivers whilst giving the brothers 24 hours to come up with a few hundred million euros. NAMA published its management accounts for 2010 which indicated the final loss for that year would be €1bn; the view on here was that the true loss should be higher but thanks to accounting considerations, NAMA was able to avoid the full horror of declines in property/security values after its valuation date of 30th November, 2009. In one of the year’s lighter notes, Tom Barry the Fine Gael TD from Cork accused NAMA of saying , to quote the politician verbatim, “let’s kill the whole lot of these pigs and get rid of them” – NAMA wasn’t talking about recalcitrant developers but allegedly was talking about a pig farm owned by one of the Agency’s debtors. After April’s receivership bloodbath, it was reported that NAMA was seeing “a marked increase in the level of co-operation between NAMA and its clients in light of its recent enforcement actions”. NAMA donates a €300,000 painting, formerly in Derek Quinlan’s collection, to the National Gallery of Ireland having decided as “a goodwill gesture to the National Gallery and to the Irish people to offer the National Gallery one piece of art from the collection for free given the fact that they advised it was of importance to the heritage of Ireland” NAMA adds flesh to its negative equity mortgage product. Concerns are raised here that NAMA is concentrating on disposals in the London market which might be counterproductive in the longer term. Whilst NAMA has moved against some developers, it is supporting others and Sean Mulryan and his Ballymore group is understood to be a favoured recipient of NAMA’s largesse as it announces a major development in London’s docklands.

June 2011

NAMA announces outline details of its controversial incentive scheme for developers whereby the Agency and the developers personally will benefit from profits. In an unbelievably stupid gaffe within earshot of attentive British and Northern Irish politicians, An Taoiseach Enda Kenny tells journalists he has concerns about shenanigans in NAMA’s disposal of assets, and retracts his comments two days later having inflicted a nice little scar on NAMA’s reputation. There is a little more light relief as speculation emerges that certain top judges are in NAMA, and there are concerns at those same judges’ impartiality in property related matters. There is credible speculation that NAMA is considering selling its US portfolio of loans in packaged bundles, something that might return to the public arena in 2012.  Not for the first time, there is unease about prices being achieved on NAMA property in the UK, and questions arise as to why NAMA is seemingly getting the lower end of expected price ranges in its disposals. Another foreclosure saga kicks off when it is exclusively reported on here that NAMA has appointed receivers/administrators to assets owned by David Daly and family. One of NAMA’s Top 10 developers, Treasury Holdings is surprisingly upbeat in the annual report of group company REO which owns the Battersea Power Station despite having €1bn of negative shareholder equity. Battersea has had a difficult history but had secured full planning consent at the start of 2011, and looked set to be developed at last having been derelict for nearly 30 years; alas, it was not to be and in December, administrators were appointed to the 38-acre site which is now on the market. The NAMA chairman appears on RTE radio and concedes that only one developer business plan is “close to finality” NAMA developer, Niall Mellon gets off his cross for five minutes to tell RTE radio that “money is not” his god, and gives some insight into the lot of a developer’s dealings with NAMA.

July 2011

News that NAMA is recruiting a political lobbyist raised some eyebrows. There was a shock decline in Irish commercial property of 5.7% in Q2 of 2011, partly in anticipation of Government moves to abolish Upward Only Rent Reviews in pre-February 2010 leases but also in part reflecting the absence of financing and the anaemic economic environment; for NAMA whose portfolio includes loans of some €9bn relating to commercial property in Ireland this is very bad news indeed. The Paddy McKillen court saga concludes with a costs hearing which sees NAMA footing the bill for the entire case, estimated at some €7m. Receivers are appointed to assets controlled by the Baron of Ballsbridge, the Dunner, Sean Dunne – Sean is publicly philosophical but the extensive personal guarantees may yet become big news. If evidence was ever needed of the bitter relationship between the Grehan brothers and NAMA, then it came on 25th July as NAMA sought personal judgments totalling €600m against the Grehans, and news emerged that the brothers were personae non grata at former properties including the Glenroyal hotel. There is an announcement that NAMA sold 58 apartments at the luxurious Beacon South Quarter development in Sandyford, south Dublin which had been developed by Paddy Shovlin; the sale was to the Cluid Housing Association,  NAMA uses the occasion of publishing its 2010 annual report with a €1.1bn loss to publish its first list of foreclosed properties – judging by the 48,000 hits on the list on this blog, there was considerable worldwide interest in what NAMA controlled. The Wikileaks leaking of the contents of US messages sent by its embassies around the world reveal that Secretary General at the Department of Finance had allegedly “hinted” that the haircut on NAMA loans could be 50% in April 2009.

August 2011

The Northern Irish dimension to NAMA comes to the fore as Minister for Finance and Personnel, the sometimes-bohemian Sammy Wilson demands more Northern Irish representation in NAMA which let’s not forget is a creation of the Dublin government. NAMA reportedly sells Fanum House in Belfast for about €5m and a Derek Quinlan property in Chelsea in London for close to €100m. Ivan Yates produces one of the most inaccurate reports on NAMA that you’re ever likely to see in a newspaper. NAMA is back in court personally pursuing the directors of Capel Developments. It is exclusively reported on here that NAMA has sold the Smurfit Kappa HQ, which was leased to the packaging giant to Smurfit Kappa who is obviously taking advantage of the property recession to cut its long term property costs. In what has become a spate of arson attacks on NAMA property, it is reported that NAMA Top 10 developer Gerry Gannon is offering a reward of €5,000 for information on fires targeting his property – more fires followed later in the year. There has been a lot of hot air and confusion about NAMA’s debt forgiveness to developers, there was a comprehensive explanation of the Agency’s approach here.

September 2011

RTE broadcasts a Prime Time special NAMAland which rambles on about the project for 35 minutes but does feature a rare developer interview with Ray Grehan suggesting he will depart Ireland in search of better prospects because of NAMA’s approach to dealing with debtors. Politicians at last lose their fear of NAMA as it is announced that Independent TD Stephen Donnelly has written to the Agency about Greystones harbour, it is shortly thereafter revealed that NAMA has set up a special phone number and email address so that TDs and senators can get preferential access to the Agency. NAMA announces that it has agreed the disposal of €4bn of “assets” – loans and property. In a series of hearings on the banking and financial crisis, NAMA appears before the Committee of Finance, Public Expenditure and Reform. TDs and senators get a master class in communication skills as NAMA succeeds in deflecting difficult questions and suppressing potentially embarrassing information. It is revealed that NAMA is lending some €10m to Fingal council to help build a road which will presumably add value to a NAMA asset. It is exclusively reported on here that NAMA is to offer One Warrington Place in south Dublin Docklands for sale with staple finance – that’s where NAMA loans up to 70% of the value of a property to the buyer; the architecturally interesting David Arnold office block which is rented to Bord Gais is understood to have now sold to Prudential for €28.4m just before Christmas.  NAMA reports that it has redeemed another €500m of its bonds, bringing the cumulative total to €1,250m . The Belmayne development in north Dublin which came to epitomise property porn in its advertisement posters during the boom is now being marketed with a rent-to-buy option. NAMA says its negative equity mortgage product will be launched in Q4, 2011 (later deferred and now expected some time in 2012). NAMA scores a bulls-eye when it sells €800m of loans in the Maybourne group of hotels (Claridges, the Connaught and the Berkeley) to Frederick and David Barclay of the Telegraph newspaper and Ritz hotel fame, the loans were said to have been sold at their original par value and NAMA made a profit because it acquired the loans at a discount. Although Paddy McKillen was not happy with the deal and has launched legal action in theUK to allegedly protect his interests, it is a done deal as far as NAMA is concerned.

October 2011

Developer and impresario – and recipient of cufflinks from Queen Elizabeth II in thanks for his contribution to the successful state visit in May 2011 – Harry Crosbie roughens a few feathers when he tells Brendan O’Connor on RTE television that “in four years time we’ll be flying and buzzing and we’ll have paid back everyone and we’ll be laughing” The public was not amused and I don’t think NAMA was either. After a couple of months hiatus, NAMA resumes its foreclosure action with the appointment of receivers to two small-scale Cork developers. Soon to resign Minister for Housing, Willie Penrose arguably oversteps the mark by demanding NAMA do more to address social housing needs in the country – a fine sentiment but what Willie seemed to be demanding was cheap housing so that he could deliver on his departmental savings and avoid much-needed reforms, or at least that was one interpretation. NAMA takes control, through administrators, of some of Belfast’s best loved watering holes when it moves on a company controlled by Sean Lyne and Noel Connellan. The most prominent Northern Ireland member of the NAMA board suddenly resigns, and in a statement issued on his behalf Peter Stewart makes reference to the Geoghegan review and a watershed moment in NAMA’s evolution. Although reported as a NAMA development by the Irish Independent, it has not been conclusively established that Church Hill in Tullamore in County Offaly is in fact in NAMA, but it nonetheless made fascinating reading when it was reported that a squatter had moved into an empty house on the estate and a local judge had refused to kick him out. It is reported that NAMA has at last sold “Britain’s most expensive house” when Updown Court and an adjacent cottage fetch a reported €40m. Although the development is not in NAMA, the developer is and news that residents of Priory Hall apartment complex in north Dublin had to evacuate their homes due to building defects and fire risks was big news which continues with residents still living in temporary accommodation, Dublin City Council taking legal action to avoid liability, threats of jail for the developer Tom McFeely and NAMA seizing the opportunity to rent some its empty homes at arms-length market prices. Commercial property drops 4.2% in Q3, 2011 exacerbating NAMA’s problems with impairment losses on its security. Prominent hotelier and developer, Alan Hanly sees receivers appointed by NAMA to various properties. On 24th October, Judge Kelly ruled that it was permissible for NAMA to sell property under its control to associates of developers, this was a side issue in the judgment order against Jim Mansfield but might take on significance in 2012 as NAMA intensifies disposals in Ireland. It was a nervous Brendan McDonagh who appeared before the Oireachtas Committee of Public Accounts, with the nervousness evidenced by his almost OCD repetition of the word “effectively” but again very little was learned and it remains a fact that NAMA disposes of an average of €500m of property per month, every month and the public and indeed political oversight committees know very little about the detail of such disposals.

November 2011

It is reported that NAMA has taken possession of an art collection formerly owned by developer and lawyer Noel Smyth, possibly best known for being associated with the Square shopping centre in Tallaght. And as 2012 came to a close there seemed to be a ramping up of activity relating to his UK investment vehicle Alburn Real Estate Capital CMBS, with changes to bondholders and existing bondholders getting antsy about the repayment of their debt and the future of the fund. NAMA is reported to be investigating a link between an employee and a developer – the employee being Colm Lundy and the developer being Newlyn; there’s not been any public conclusion to any investigation yet. We get some light relief when the judgment in the Sean Dunne/Gina Farrell case is finally published; although Sean could be said to have been on the winning side and to have been vindicated in the justice of the case, NAMA was accused of effectively funding an unfeasible court case. Not for the first, and probably not the last, time NAMA is accused of subsidising loss making hotels which place the futures of traditional hotels in jeopardy; this time the accusation comes from Failte Ireland though NAMA insists that its impact on the hotel sector is exaggerated and that it is a relatively small player in the bank controlled hotel sector with Bank of Scotland (Ireland) being reputedly the biggest player. Another one of the “good” developers, John Fleming emerges from bankruptcy in England and faces an uncertain career future but at least he can draw a line under his 1bn-odd debts. The day after John emerged from bankruptcy, another “John”, this time John Ignatius Quinn (or “Sean” Quinn as he is known to Anglo) filed for bankruptcy in Belfast. Although not reputedly in NAMA, Sean’s example of seeking bankruptcy outside this jurisdiction is likely to be copied in 2012 regardless of any changes to the personal insolvency regime. NAMA benefits from the auctioning of Derek Quinlan’s art collection at Christie’s sales in New York and London, and is also understood to have benefited from a Goff’s auction of racehorses where developer Michael Ryan’s foal from “See the Stars” fetched €800,000. The BBC broadcast a vanilla programme on NAMA and its role in Northern Ireland. NAMA loses a second director in two months, this time arguably its most senior banking man, Michael Connolly; there is no statement from the departing Michael and NAMA issues a bland statement. NAMA absolves the Dublin Docklands Development Authority of future liability on loan commitments in respect of the 25-acre Irish Glass Bottle site in Ringsend, in return for certain properties, the value of which is not disclosed.

December 2011

In what may be the first of many, NAMA is understood to have sold a portfolio of loans relating to UK developer, Cyril Dennis. The price tag was said to be GBP 280m (€326m) and the buyer Orion Capital Partners. Budget 2012 sees the abandonment of the Government’s manifesto commitments on Upward Only Rent Reviews in commercial leases, and the reduction of commercial property stamp duty from 6% to 2% and range of property incentives. The uninspiring Geoghegan review of NAMA is published and it is announced that Minister Noonan is to create a quango which will advise the Minister on matters relating to NAMA – the “advisory board” will require a Direction pursuant to the NAMA Act and we still wait to see the text of that Direction and its compatibility with the European Commission decision approving the NAMA project. NAMA appoints receivers to yet more small-scale developers, Banna Holiday Villas and Cloonbeg Developers and to a mid-sized developer, Cleary Doyle. The NAMA v David Daly saga came to an apparent end with the announcement of a settlement and the sale of properties on London’s New Bond Street and the refinancing of remaining loans. Earlier in the year, NAMA had advertised for investigators to verify developer’s statements on assets and liabilities, in December, NAMA decided to get heavy and advertised for a panel of private investigators.  NAMA was dragged into the Vita Cortex dispute in Cork where 32 workers were made redundant at a company connected to developer Jack Ronan. The workers weren’t paid redundancy and NAMA was portrayed as a Scrooge because NAMA did control a bank account in a sister company but that money is according to NAMA, secured on loans. On the eve of the seasonal break, it was announced that NAMA was to make up to 2,000 homes available for social housing in 2012, but it seems Minister for the Environment, Community and Local Government, Phil Hogan got ahead of himself with his announcement – NAMA has only foreclosed on a fraction of 2,000 homes in Ireland, its developers still have discretion over the disposal of assets and any social housing arrangement will be on an arms-length commercial basis. .

A happy New Year to you all!

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