We reported here last week that NAMA is going great guns at dealing with requests for rent reductions from commercial tenants of property subject to NAMA loans – not only has NAMA approved reductions or rent abatements, to date of some €22m but it is dealing with requests within an average of five working days and approving 97% of requests. So, good news if you are a commercial tenant of a NAMA-controlled building.
Unfortunately, tenants of IBRC buildings are in a different boat, despite IBRC being 100% owned by the State. In a response to a parliamentary question from the Fianna Fail finance spokesperson Michael McGrath yesterday, the Minister for Finance Michael Noonan said that when the unsold loans of IBRC are ultimately transferred to NAMA, then at that point which will be from August 2013 onwards, from that point tenants can seek rent reductions but until then, they’re on their own.
You have to be impressed by the joined-up thinking!
The full parliamentary question and response are here.
Deputy Michael McGrath: To ask the Minister for Finance if he will consider applying to clients of Irish Bank Resolution Corporation the same criteria for applications for rent abatements as is currently applied by National Asset Management Agency;; and if he will make a statement on the matter.
Minister for Finance, Michael Noonan: As part of the role of the liquidators, the assets of IBRC will be valued independently before being sold. Any assets not sold to third parties (including loan counterparties and other financial institutions) at or above the valuation price will be sold to NAMA at the independent valuation. Where the assets are acquired by NAMA then normal NAMA policies and procedures would apply including their guidelines on rent abatements.