Nama could ‘continue its work’ past 2020, chairman indicates
Agency expects to have earned €3 billion surplus for State by end of the decade
Nama chief executive Brendan McDonagh and chairman Frank Daly at the publication of the agency’s annual report. Photograph: Maxwell
According to its annual report, Nama expects to have earned a €3 billion surplus for the State when it finishes its work at the end of the decade, almost 30 per cent more than €2.3 billion predicted last year.
Speaking after publishing the report on Thursday, Mr Daly and chief executive Brendan McDonagh indicated that Nama could continue to function after 2020.
The organisation will play a central role in redeveloping the old Irish Glass Bottle site in Poolbeg, Dublin, which will hold 3,500 houses and apartments, more than 900 of which will be earmarked for social housing. “That is likely to go long beyond 2020,” Mr Daly said.
The Fianna Fáil-Green Party coalition established Nama in 2010 to help rescue the Irish banks by paying them €31.8 billion to take over the property loans that threatened to sink them.
Since then Nama’s role has expanded into funding the construction of offices and new homes on some of the sites used to secure the debts. It is backing various projects in a special development zone in Dublin’s docklands.
Work is under way there on 1.8 million square feet of offices and 230 homes, while it has a further 1.5 million square feet of commercial buildings and 1,210 houses and apartments in various stages of planning and pre-planning.
Nama aims to support the construction of 20,000 new homes, mostly in Dublin, up to the end of 2020. By March 31st, Nama-funded developers and receivers were building 2,064 homes.
The agency has approved finance for another 1,114 new homes, which have planning permission but on which work has not begun. It has planning for a further 7,475 and has sought, or intends to seek, permission to build another 10,000.
Nama has continued to sell off many of the loans it acquired, mainly to multinational investment funds. Its annual report shows that of the €5.4 billion cash it generated last year, €5 billion came from selling assets.
The agency earned profit of €1.5 billion in 2016. The performance left it on track to repay all its €30.2 billion senior debt by the end of this year, and the remaining €1.6 billion in subordinated debt by 2020. Just €500 million of its senior debt remains to be paid off.
Mr Daly said the agency was particularly proud that it would repay senior debt three years ahead of its 2020 schedule. “This is a major burden which has been taken off the heavily indebted State,” he said.
A commission led by retired High Court judge John Cooke is likely to begin its work later this year. His inquiry follows scrutiny of the deal by the Comptroller and Auditor General, Séamus McCarthy, and the Dáil’s Committee of Public Accounts.
Mr Daly said the agency would co-operate with the commission and welcomed the fact that it was hiring financial experts to work on the inquiry. Police in Northern Ireland are continuing to investigate some aspects of Project Eagle.
Since 2014 Nama has backed the construction of 4,840 new houses and apartments in the Republic.
By the end of last year, Nama had offered 6,941 residential properties for social housing. Local councils confirmed that they needed 2,748 properties and Nama handed over 2,378 homes to them.
The report says Nama has invested or committed more than €107 million to refurbish and finish houses and spent more than €200 million buying houses and apartments through a special social housing unit, National Asset Residential Property Services.