Although Senator Mark Daly’s credibility might have been diminished in some eyes when he refused to provide details last year to substantiate his allegations about NAMA disposing of property below market value to associates of borrowers, that may be set to change with the Senator’s bid to have NAMA publish details of all property for sale and completed sale details on a public website and if the details of a NAMA sale reported in today’s Irish Examiner turn out to be correct.
This transaction really takes the biscuit for lack of transparency – the Irish Examiner today reports that NAMA has sold 125-acres of farmland “off the N25/ Ballincollig Bypass” in county Cork to University College Cork (UCC) and the Munster Agricultural Society. The price has not been disclosed though the Examiner reckons it was €3-4m, or €20-30,000 per acre. So here we have one State agency, NAMA (nominally independent, but who are they kidding) selling property to the State-owned University College Cork and what claims to be a “farmers society”, the Munster Agricultural Society (MAS). And the price is not publicly available. That’s not the real issue though.
The Examiner goes on to say that “the land, while not advertised for sale, was on the market and had appropriate signage on the arterial, western route into the city” So a property supposedly worth €3-4m which might have been expected to garner national and indeed international interest had a few “for sale” signs stuck up on it!
Agricultural land is generally selling for about €7-14,000 in the State so this price goes beyond purely agricultural use. The Examiner says “the land will have amenity and community use. It will address MAS’s need for a new home and will open up space for a Science and Innovation Park for UCC at an adjoining site at Curraheen. This land is zoned for a Science Park and the new lands will allow the university to relocate their facilities westward.”
The Examiner says that the land wasn’t advertised for sale, save it seems, for the signage along the road into Cork city. Elsewhere the report says that the land was previously owned by NAMA developer, John Fleming but that it had been sold by NAMA. John Fleming recently emerged from bankruptcy in the UK and all of his property had been foreclosed, to the best of my knowledge. So the first thing I did when I read the claim that the property was “on the market” was to check NAMA’s latest enforcement list for November 2011. This list is sorted by country, by county and by town/district. So I expected to see something for Ballincollig. Nothing, though that doesn’t necessarily mean it hasn’t been geographically classified elsewhere. NAMA was then contacted and it said the land was classified as “Curraheen, Bishopstown” and indeed there is an entry on the November foreclosure list for “Development-uncommenced” at that address showing PwC as the receiver and DTZ Sherry FitzGerald as the estate agent. NAMA has not commented on the marketing of the property.
NAMA came in for some criticism in November 2011 in the Dail when deputy Mary Mitchell O’Connor said in relation to a property supposedly for sale in Booterstown, Dublin “I understand the sensitivity of sales under NAMA but I am concerned that in giving misleading addresses or limited information on properties for sale NAMA is constraining ordinary people from knowing what is for sale and bidding on these properties”. It seems as if Deputy Mitchell O’Connor’s concerns apply as much to Cork as they do to Dublin.
UPDATE: 17th January, 2012. The property sales material from DTZ Sherry FitzGerald –available here – shows the property address as Curraheen, Bishopstown. This appears to be the location of the property, marked with a red outline below.
UPDATE: 18th January, 2012. Locals confirm the correct address of the land as Curraheen, Bishopstown which is what is shown on the DTZ sales material and the NAMA enforcement list, so in this case, unlike the Mary Mitchell O’Connor case in Booterstown, addressing does not appear to be an issue. The more important issue however is the marketing of the property. DTZ has been asked to comment on the report in the Examiner that its marketing was limited to erecting roadside signage.
NAMA Wine Lake 
NWL Your criticism seems to be misplaced here.
It’s DTZ Sherry FitzGerald who are responsible for marketing the property. Why didn’t give this bastion of free enterprise a call and ask them to explain the lack of visibility.
You might also ask what juicy fees they charged for this wonderful marketing job while your talking to them!
You can’t hold NAMA responsible for every property sale while the so called professional property experts are taking the fees.
It’s DTZ Sherry FitzGerald who are responsible for marketing the property. Why didn’t give this bastion of free enterprise a call and ask them to explain the lack of visibility.
Well, why don’t we carry your logic on even further and just find the Sherry FitzGerald person in charge of this site and just place the blame on him?
No; you can and you should hold Nama accountable. Nama is ultimately in charge of all these dealings and Nama is ultimately the body that must answer to the public for any and all mismanagement of their assets.
There is no substitute for grilling the man at the top.
The issue highlighted by NWL was the lousy marketing of the site.
Why not ask the folks who were paid the fat fees to market the property DTZ Sherry FitzGerald why they did such a crappy job? Its just a question.
When people want someone to blame how rarely pick anyone in the private sector.
The Bank Auditors said the banks were fine, but let’s blame the regulator.
The hospitals are a mess, don’t blame the consultants the most powerful group who delayed the contract for 4 years, blame the HSE instead.
In the PPARs disaster the project mangers, Delighted and Touched, took 140 Million and delivered nada, blame the HSE.
We need accountability in both public and private sector. The continued hype that the private sector are a crowd of super efficient angels is a big a myth as the idea that the public sector is never effective.
It’s disappointing to see the the standard media hype.
Public Sector Bad.
Private Sector Good.
The bottom line is that monopolies and oligarchies, whether public or private, become inefficient and arrogant very quickly.
NAMA is one hell of a monopoly and must be held accountable but lets also keep a eye on all the property pigtroughers.
@Paddy, DTZ was asked yesterday for a comment on the Examiner report on the extent of their marketing. There hasn’t been a response yet.
I do not agree with your defense of NAMA.
My understanding is while a receiver is there and an agent the fees are ultimately approved by NAMA in all instances I have seen. The only incentive would accrue to the sales agent solely as his fee would be a % of proceeds, therefore the higher the price the more he gets.
The point that is being made and I agree with is that in all dealings with NAMA is they have the final say in all matters concerning acceptance of a price being paid.
We all recognise that NAMA ultimately make the call and in fact have even stated they will not sell below their purchase price as evidenced in some quasi offerings of residential schemes around Dublin before xmas ultimately being pulled with offers on them because they are not happy with the price offered.
The value of an asset is the price someone is willing to pay for it today, therefore how can we believe the accounts presented by NAMA are adequately provisioned due to the marked deterioration in prices since they took them onto their books.
We know NAMA have to make large repayments of loans in the coming terms where will they get the cash to do so. Can you not see that they by my calculations must be at least 12% to 25% distressed themselves from what they paid as they are suffering from the candle being burnt at bought ends of the stick.
Firstly they have annoyed the investors by not being serious and engaging in sales processes and now have to hide that failure and sell off loans to camouflage this another raft of consultants fees.
Secondly even though their cost of funds is low they are firmly a debt collection agency and cannot make a twist on an interest rate differential over time. Does anyone not see they were always out of their depth and failed to hire the leadership day one for an operation such as envisaged but thats for another day.
The budget is passed with incentives but now with rent again under pressure by the government in the last few days and property tax in place how can house prices recover even in the medium term. Its the blind leading the blind we are afraid of.
The real issue is twofold. NAMA have to redeem sums of money that are quite large in the current year.
Residential (land,houses) must be a serious concern to them, I for one cannot believe they have adequately provided for the diminution in value that has occurred since the took the asset class on. Therefore what will the additional cost be to Irish citizens ultimately over time. Does anyone think NAMA are capable of delivering or credible at this stage.
The more frightening thing is how many sales are being made of assets to state sponsored organisations to generate cash. Are these at market value today, are they inflated to give NAMA the required number for redemption, is the state getting value for these purchases, were they necessary, where did UCC and the other organisation get the funds etc. A whole myriad of relevant concerns.
Is not this the essence of the concern, we the people are being taken for granted again, no transparency got us into the mess do we ignore the issue again where will that get us.
I think the article myself was short in its questions and its investigative content and should have gone further in its examination of the sale. A bit sensationalist instead of of asking why, what, when and where and finally who benefited and finally how many assets have NAMA sold to the state or related bodies since inception and at what price wonder would you get an answer to that potential ponzi scheme.
NAMA needs to be policed.
@c1970..’We know NAMA have to make large repayments of loans in the coming terms where will they get the cash to do so’
They have plenty of cash,more than enough to fund the new DIT campus at Grangegorman which most likely would get approved by your ‘lenders’.
http://www.ggda.ie/
This is current ‘cash’ position.
“NAMA has approved sales of assets totalling €6.6 billion. A large proportion of the sales proceeds will be used to pay down NAMA’s borrowings and the Agency has used its strong cash flow to redeem €1.25 billion of bonds in issue and repay €299 million in advances made by the Minister for Finance. At the end of 2011 NAMA had total cash and liquid asset balances of €3.8 billion and is on track to meet its target of repaying 25 per cent of its outstanding debts by the end of 2013. ”
Click to access NTMAResultsAndBusinessReview2011.pdf
To my own knowledge, this is the third time that NAMA has done a “sweetheart deal”. Two of the three were as a direct result of political interference and one is arguably political.
This transaction does appear dubious, unless it falls into the “social dividend” malarky. In which case you would reasonably question the costs of involving an estate agent.
I suppose the timeline might throw up some anomalies. MAS seem to have been looking for a new home for 5 years. Their local knowledge would have stirred their interest when Fleming got into trouble. Did MAS contact NAMA directly to express an interest?
How long would it take for MAS to agree a deal with UCC? It’s likely MAS would be able to make decisions quickly, I’d be surprised if a university would be geared to act quickly. i.e. UCC would probably have to refer the matter to the board, they may have to liaise with gov. departments, budgets would have to be agreed etc. So there’s a lot of ducks to get in a row (what was UCC’s spending limit if another bidder emerged?)
So, in short, I’d tend towards WSTT’s ‘sweetheart deal’.
UCC always likely purchaser here, they have huge tranche of lands called “The Farm” used as sports grounds for 20 years + adjacent and across the road from these lands (unclear which side of road the subject lands are on from MAP above. Havent been down there in years but think they have a big science and innovation park going in here also. NO idea if they already own all the land referred to in link below but if they do it looks to my untrained eye that there is already far more than 125 ac owned there. The sports grounds are c 50 ac and they only make up a tiny portion of the shaded area. UCC one of the biggest proeprty owners in Cork, if not the country also.
http://corkrunning.blogspot.com/2011/08/ucc-farmend-of-era.html
Sorry if I had looked at sales brochures would have shown me where lands were. Looke like UCC already own lands behind the narrow strip and have bought another massive block across the road from existing holding
@paddy19 not much point in wasting time,energy and resources if you have a logical buyer,why NAMA needed/required sherry fitz to place an old sign on the site is beyond me.Is there no ‘lender liability’ law,whereby the original borrower can sue for damages,if the receiver/lender does not achieve the maximum price in the open market between willing buyer and seller.
Does NAMA,not have the in house skill set to deal with logical buyers or is this a cover your ass deal,where sherry fitz can take the heat.
How would UCC,fund something like this,do they not have a capital budget that they have to adhered to,perhaps a large endowment or generous gift from a donor funded it or the taxpayer.Can UCC,just willy nilly buy any piece of land its likes with unlimited state resources at its disposal.
As a public body,did they have a valuation done,some third party advice how was the deal negotiated ?
@JG, as I said in my comment, UCC are one of the biggest proeprty owners in Cork. Id suggest their staff could give a few lessons to NAMA, and indeed any valuer that would care to engage with them.
@DG definetly looks like it,I doubt John Flemming was planning on farming it.