John Mulcahy’s speech at last week’s chartered surveyors’ annual conference certainly didn’t pull any punches when he squarely laid responsibility for emerging housing supply shortages at the feet of the public sector because of delayed and bureaucratic planning procedures. The claim by the outgoing head of asset management at Nama rowed in with earlier similar criticism levelled by economist Colm McCarthy after the Minister for Housing, Jan O’Sullivan, said there was already plenty of planning permission in place in the capital, and the real problem lay with the absence of credit. Pointing to the current high levels of occupancy of rented and privately owned property in the capital, Mulcahy warned that normal market movement will be restricted by a shortage of new accommodation coming on stream. However his thesis didn’t address mobility constraints already in place for homeowners affected by mortgage arrears and negative equity – an ongoing banking sector issue.
Meanwhile, Mulcahy was bullish on Ireland’s opportunity as he told the 420 assembled surveyors that the market here has “fired into life” and Nama would be happy to feed the market as much product as it can absorb. He added that the preference would be to avoid selling assets to wholesalers from outside who are simply waiting to sell them on at a profit, preferring instead to sell to investors and owner-occupiers here who will hold properties for a number of years. He welcomed the introduction of homegrown Reits (Real Estate Investment Trusts) here after legislation was amended in Budget 2013 to accommodate them. Mulcahy said if the private sector hadn’t seized the opportunity – referring to the establishment of Green Reit earlier this year – Nama would have moved in themselves. “They’re a terrific idea because they raise capital and that capital can invest in Ireland.” Mulcahy then put audience member Bill Nowlan on the spot when he asked for an update on his company, WK Nowlan’s plans to establish a second Irish Reit. But Nowlan was giving nothing away. Given his enthusiasm for the Reit model, could this be where Mulcahy plans to direct his energy after he retires from Nama early next year?
