PRODUCT PROFILE

Latest Dublin Prices

Treasury say NAMA holds back recovery

Thursday, June 14 11:14:49

Irish property investors, Treasury Holdings today said that NAMA is holding back recovery in the Irish property market.

It called for the appointment of a third party to negotiate with potential overseas investors in Irish property and loan portfolios to secure the best deal for NAMA and the taxpayer.

The company, headed by Richard Barrett and John Ronan, is currently challenging NAMA's decision to call in nearly E1 billion in loans with the court case set to kick off next month.

In a statement today Treasury said that a range of potential investors had expressed interest in Irish property with some making substantial bids for property portfolios including the loans of Treasury Holdings. None of these bids moved to the point where they were accepted by NAMA.

"Investors, to our certain knowledge, continue to be very interested in entering the Irish market in a significant way," according to John Bruder, Managing Director of Treasury Holdings.

"Three substantial bids have been made for our loans over the past 18 months. These were from serious foreign investors and would have helped kickstart the Irish commercial property market and start the development of badly needed high end office accommodation. None has been accepted but we know that the bidders remain out there willing to engage. All have offered to buy the loans at a higher value than NAMA paid for them. Some also offer NAMA the potential of a stake in the future of the company to ensure they benefit from any future upside."

"We sought to develop these bids but one deal fell through and NAMA did not wish to engage with the other two bidders. We believe an independent third party mediator, of the Government's choice and with experience of major property deals, should be appointed to negotiate in detail with foreign investors and secure the best possible deal for the taxpayer."

The company said that a transaction with a new investor of this scale could deliver a profit to NAMA on a large loan portfolio and could deliver a potential E900m transaction in an otherwise illiquid market.

It could also establish market values for property in Ireland; facilitate FDI into the Irish property market by delivering one (or more) major overseas investors; signal to the international market that NAMA is open for business; facilitate Treasury's management platform survival so that it can contribute to Ireland's economic recovery and protect the jobs of the 300 people working for the Treasury Holdings Group in Ireland and the jobs of its key suppliers, it maintains.

Treasury said the alternative to this was the destruction of value by the appointment of receivers, the selling of portfolios piecemeal, or the placing of prime Irish properties into passive investment funds without retaining the skills and expertise required to develop and manage these assets in the public interest.

"We are currently involved in a series of legal actions with NAMA, the most substantive and immediate of which is our judicial review proceedings against NAMA's decision to appoint receivers, a case which we are very confident we will win. We don't want to spend huge amount of time and resources in the Four Courts. We are open to any alternative route involving mediation or third party negotiation in order to end this process quickly", said Mr Bruder.

He said he agreed with the recent statement of the Chairman of NAMA Mr Frank Daly that he is "cautiously positive" about the property market. Supply shortages are emerging, particularly in the area of prime office space in Dublin. A move to meet that growing demand can happen and can in the process kick-start the property market and bring associated job creation and growth if the right steps are taken.

"We at Treasury Holdings believe that we have the expertise, experience and property portfolio that would allow us to be at the forefront of those asset managers and developers who can contribute in a tangible way to economic recovery. "

Treasury Holdings is today publishing a lengthy account of the history of its dealings with NAMA. Its aim is to question NAMA's refusal to engage with it or potential investors in order to maximise the return to the taxpayer and keep intact what is currently the only full spectrum property asset management and development company in Ireland.

In a joint statement the current shareholders of Treasury Holdings Richard Barrett and John Ronan said: "The property crash has brought a new reality to this company. One part of it is that if a deal is done to bring new investors into Treasury Holdings or to sell our loans, the company will then be controlled by others, and not by us. Any deal will have to be approved by NAMA. "What we will get out of any deal is the satisfaction of seeing this company and its unique collection of skills and expertise kept intact and continuing to provide the top quality office and other accommodation that Ireland, and potential foreign direct investors, need. We will also see the jobs of the 300 people who work for Treasury Holdings safeguarded and the company playing a role in Ireland's economic recovery."