State making ground rent payments on 53 properties
THE GOVERNMENT is facing fresh calls to abolish ground rent payments following the latest figures which show the State is making payments for more than 50 properties such as Government Buildings and Dublin Castle.
Data compiled by the Office of Public Works shows the State is paying ground rent to landlords such as the Earl of Pembroke for buildings on Merrion Square, and the Duke of Leinster, who owns land where the National Library is situated.
Ground rents, often regarded as a legacy of our colonial past, are payable in cases where a person owns the building but not the land on which it is built. They are also known as a leasehold.
In the case of the State, the rent is hardly crippling. The combined total rental payments for all 53 properties on an annual basis amount to just €5,129.
The State’s ground rent bill for Iveagh House on Stephen’s Green is €257.76 and it is €220 for the Four Courts.
The bill for Dublin Castle is just €7.33.
Other buildings where the State is paying ground rent include the Customs House in Cork, Dunsink Observatory, and the Central Mental Hospital in Dundrum, Dublin.
Sinn Féin has called for an end to the system of paying rent to “British absentee landlords”.
A closer scrutiny of ground rent payments paid by the State shows that significant numbers are made to private Irish landlords or holding companies.
For example, the State also pays Bank of Ireland for land on Merrion Square (€116 a year), while the Irish Press plc receives payment for land on Burgh Quay (€177).
Brian Hayes, Minister of State for the Office of Public Works, acknowledged the system was “anachronistic and ridiculous”, but said a referendum would be needed to end it.
He said while this issue was not a major concern for the State, it was a more pressing issue for individual homeowners, especially those selling their homes or seeking to acquire the freehold of their property.
“There are people in the Oldbawn area of my own constituency who receive letters for payment, but many don’t pay.
“The problem is when they sell their home, they often have to buy out the lease or come to some arrangement,” he said.
Critics of ground rents say there is also a risk that when ground rent leases come to an end, landlords may make a claim for up to one-eighth of the value of their home.
There are an estimated 250,000 ground rents around the State.
In 1967, the Government introduced laws enabling tenants to acquire the freehold of their property.
A decade later another law was introduced banning the creation of new ground rents in respect of residential homes, but reserving the right of landlords to create ground rents on all other types of property.
More than 80,000 people have availed of this ground rent purchase scheme, while about 1,600 applications are received to buy out ground rents every year.