McInerney house completions down 42%

Ireland's biggest housing developer, McInerney Holdings, has revealed a 42 per cent drop in Irish private house completions last year but says that it has a strong balance sheet going into 2008, writes Adam Harveyand Una McCaffrey.

The firm issued a full-year trading update yesterday amid continued heavy trade in its shares. Some 2.4 million shares changed hands yesterday, with developer Liam Carroll now thought to control a stake of about 8 per cent.

Businessman Seán Quinn was also rumoured to be in the market. If this was the case, confirmation could be expected today. Some believe Mr Quinn could now control a stake of close to 20 per cent in McInerney. A spokesman for the Fermanagh entrepreneur declined to comment on the matter last night.

Further speculation yesterday surrounded a possible third buyer, with any new investors in the stock likely to have been attracted by Mr Carroll's stake-building of recent weeks.

The developer is thought to be interested in McInerney's land bank, although an outright bid for the company is not said to be imminent. Directors and management control almost 18 per cent of the stock.

Yesterday's trading update showed that McInerney builders completed 594 private houses in the State last year, down from 1,025 in 2006.

The company's managing director, Barry O'Connor, blamed negative sentiment and the tightening of credit for the slowdown. "The market is going through a period of correction, some of it necessary. The adjustment should provide a more stable housing market," he said.

Deposits on hand were also down at McInerney, falling 26 per cent to 282. However, overall the firm performed better in 2007 than in 2006, thanks to strong growth the UK, where it finished 1,400 houses in 2007, up from 980 in 2006.

Shares in the group closed four cent lower at €1.56.

Flor O'Donoghue of Davy Stockbrokers noted that the result underlined 2007 as "the year in which McInerney came of age in the UK".

Mr O'Connor said that the firm was in good stead despite "challenging" market conditions in the second half of 2007, and more growth was predicted for the coming year.