Bank sales start on southside

Banks are taking their time to offload apartments in schemes that have gone bust, but the sell -off begins today with two developments in south Dublin

TWO mothballed apartment developments in south county Dublin are going for sale today on the instructions of banks, with prices starting at €135,000 for one-bedroom units.

One of the schemes, Carrickmines Green, which is being sold by Anglo Irish Bank, hit the headlines last year when early buyers lost their deposits after developer Laragan went into examinership.

Now the remainder of the apartments and houses in the scheme beside the M50 are being sold at discounted prices through HT Meagher O’Reilly New Homes. There’s a selection of one, two and three-bedroom units available in a single block as well as some four-bedroom terraced houses.

One-beds start at €135,000; two-beds at €180,000; large two-bed penthouses cost from €250,000 while the four-bedroom houses are available at €350,000.

The sell-off is the first significant move by a bank to offload apartments in one of the large Dublin developments and the prices will be eyed by other receivership companies planning to sell stock in the coming months.

Meanwhile in Templeogue, Dublin 16, Cedar Grove, an apartment scheme completed in 2007 and unsold since, is now being offered at discounted prices by its receivers.

Located on Firhouse Road, this is a small scheme with just 18 units that have been completely finished and well maintained through the receivership process. Two-bedroom apartments originally priced at €525,00 are now being offered for between €275,000 and €325,000 depending on their size, location and orientation.

Three-bedroom units that had been €620,00 are now priced from €340,000. The scheme was original aimed at downsizers and the apartments are larger than average - two-beds are range in size from 81sq m (877sq ft) up to 117sq m (1,259sq ft).

Cedar Grove had been marketed through Lisney but Douglas Newman Good New Homes have taken over sales. Invariably receivers appoint a new selling agent as part of the process. In the case of Carrickmines Green, the previous agents were Hooke & MacDonald and Douglas Newman Good.

HT Meagher O’Reilly New Homes has already been involved in a number of receivership sales outside Dublin, notably a sell-out scheme in Newbridge, Co Kildare, earlier this year and a completed apartment block in Navan that is currently attracting a lot of attention from investors.

Carrickmines Green is located at exit 15 of the M50, beside Carrickmines Retail Park, and close to the Luas Green Line which is due to open later this year. Of the 49 units available, most are apartments in a block called Laurel House with a number of houses in two avenues, The Walk and The Crescent, which overlook a large triangle of communal garden.

Behind Laurel House is a tract of land that had been earmarked for over 100 further apartments. However, the receivers are now planning to revise the planning permission on this to seek 50 semi-detached and terraced houses instead.

Selling agent David Browne expects reasonable interest in the scheme at the new price levels. “The first response people have with receivership sales is “where the’s catch” but in ths case a lot of work has gone into preparing the units for sale. The units will all be snagged and there will be structural guarantees.”

Value will attract buyers, he says. “We are finding that people have money put by that they are beginning to put back into property, whether it is money that has been sitting in shares or in prize bonds or in bank accounts.”

Estimates vary as to the number of apartments that have been caught up in the property collapse, but one agent specialising in new homes reckons that there could be up to 2,500 apartments in south Dublin that will have to sold at discounted prices by banks who have foreclosed on the developers who built them.

Some of these, like Cedar Grove, have lain empty now for over two years, but it could be several months, if not years, more before they finally make it to the market.

According to David Browne the reason for the delay in bringing similar schemes onto the market is the amount of work involved to ready an apartment complex that has been repossessed by the bank. “There is an issue with the Home Bond Guarantee scheme for instance. Once a receiver comes into play, the apartments have to be re-certified. There may be issues with the management company and also with previous buyers who may have a contract but have not completed their sale.”

Bankers, solicitors and estate agents are on a steep learning curve, he says. “We are dealing with new territory here.”

New homes mortgage specialist Frank Conway suggests that the delay in disposing of distressed properties has been caused by the banks being entirely taken up with transferring loans to Nama, with all other business long-fingered.

The rental market has also become an option for empty properties. “Some banks may have taken the view that the rental market is better than the property market and are simply taking the rents directly in lieu or in addition to developer payments,” he said.

However, he also sees a general reluctance by the banks to simply offload properly quickly. “The big banks are slow to act on their non-performing loans. Most of the receiverships that I have seen to date are as a result of non-Irish bank moves, who have been a lot more aggressive at recoveries (on the developer end at least).

There has also, he says, been an expectation at Government level that actions would be measured. “While I don’t expect that the Government is saying ‘don’t put developer X into receivership’, I think the banks have been reminded of how challenging a free-for-all could make the current property market.”

With the banks finding their bearings in the new market, there’s unlikely to be a flood of apartment schemes coming on the market promising ever lower prices.

However, would-be buyers will see a trickle of schemes coming up for sale in the Dublin suburbs with prices set by receivers rather than estate agents.

Carrickmines Green might attract investors, who some agents say are cautiously returning to the market where they can see rent “washing the face” of a mortgage.

Cedar Grove, on the other hand is likely to appeal to its original target market, downsizers leaving a family home in favour of a well appointed apartment with lots of space and extras.