Ballymore did not play role in property crash, says Mulryan

Developer said Ballymore was a ‘victim’ of the crash as most assets were outside Ireland

Irish developer Sean Mulryan does not believe he or his company Ballymore Properties played any part in the crash of the property market here in late 2008.

"If i didn't pay my debt back I'd say I did [play a role]," the company's founder told the Oireachtas Banking Inquiry today. "But I don't think so."

Mr Mulryan said he had paid a “huge price” from the property and banking crash but he was paying all his debt back and “that to me is the most important thing of all”.

“All of my executives took a 25 to 30 per cent reduction in their wages,” he added. “They rolled up their sleeves for seven years and sacrificed everything in time to get through this. To get our mountain of debt taken down and paid back, which was huge at €2.2 billion.


“We all sacrificed our lives. No social lives, no holidays. We just worked around the clock for the last seven years.”

Mr Mulryan said Ballymore Properties had “grave concerns” about the health of the Irish property market in 2007 and believed the country was producing 30,000 housing units too many annually.

"We were very negative on Ireland from 2002…because we thought that land prices were getting very expensive," Sean Mulryan told the committee.

“We knew the market was oversupplied,” he said. “We had grave concerns about the Irish market for 2007 and 2008.”

Mr Mulryan said that by 2006, Ballymore had largely ceased investing in Irish property and some 85 per cent of its assets were overseas by the time of the crash in late 2008.

‘Victim’ of the crash

He said Ballymore was a “victim” of the crash given that most of its assets were held outside Ireland.

The Ballymore founder said he never anticipated the banking collapse and thought the crash in prices might be of the order of 25 per cent rather than what occurred.

Some 90 per cent of Ballymore’s borrowings were held with Irish banks and the collapse of the financial institutions here had a “devastating impact” on the business, he said.

“We were unfortunate to have so much of our borrowings with Irish banks,” he said. Ballymore couldn’t continue to operate properly “once capital dried up”.

Mr Mulryan said Ballymore was better placed than some of its rivals to recover due to the fact that it has substantial assets in London, where the market continued to perform well.

He said Ballymore entered the National Asset Management Agency with a "tight" business plan and the company had co-operated fully with the State agency. History would show that in Ballymore's case, Nama was effective in ensuring that "monies borrowed were repaid".

“While it was a most painful and costly process for Ballymore, our strong asset base especially in London has allowed to stay in our core business and raise new finance and regroup and ensure the future viability of the business,” he said.

Mr Mulryan said he was “looking forward to paying its debt relating to the Irish banks, exiting [NAMA]soon and returning to a normal market model.”

Ballymore’s Irish turnover rose from €11.7 million in 2001 to €114.5 million in 2008. Group turnover, including overseas projects, rose from €84.9 million in 2001 to €483.6 million by 2008.

Its total debt by September 30th 2008 was €2.4 billion, which was held by 11 banks.

It also emerged that Ballymore was 35 per cent off the winning bids for both the Irish Glass bottle site in Ringsend and the Ballsbridge hotels acquired by Carlow developer Sean Dunne before the crash.

Ciarán Hancock

Ciarán Hancock

Ciarán Hancock is Business Editor of The Irish Times