Sunday 23 July 2017

NAMA open to partnerships in property funds

Donal Buckley Commercial Property Editor

NAMA is offering non-NAMA banks the opportunity to take part in the €1 billion fund it is planning to establish to provide finance for property purchasers. The move could increase the size of the fund beyond NAMA's €1 billion target and also help to address the shortage of mortgage funding.

Meanwhile NAMA has also indicated that it may sell properties at prices below the November 2009 valuation levels at which it acquired loans. Since then commercial property prices have further fallen by 15pc.

A spokesman said: "NAMA has been clear that market prices are dictated by what people are willing to pay not what sellers are hoping to get."

Banks that decline to participate in the funding of property purchases could now be under pressure to accelerate their disposals of mortgages and properties including commercial investment properties and development land. If the non-NAMA banks delay until the end of the year they could find themselves out-manouvered by NAMA, AIB and Bank of Ireland.

NAMA says its funding plans are not set in stone and it is open to considering various suggestions and proposals in this regard both from banks and other parties.

"The Agency is open to considering whether non-NAMA banks would like to partner the agency in a similar scheme which would obviously open it up to support sales of non-NAMA-linked properties."

Non-NAMA banks, in particular Bank of Scotland (BoSI) and ACC, will now find that they are under pressure to either provide funds or otherwise their properties could prove more difficult to sell.

As BoSI has withdrawn from the market and delegated the winding down of its Irish loan book to Certus, they may not participate. The race to sell was kicked off by BoSI in April when it auctioned many of its commercial and residential properties at knock-down prices.

A further five bumper auctions are planned including ones by Savills and Real Estate Alliance. Meanwhile non-NAMA bank, Ulster, has already begun funding buyers of its distressed properties as seen at the Gasworks in Ringsend, Dublin 4.

Irish Independent

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