Shelbourne owners paid extra €7.1m in refurbishment costs
The owners of Dublin's landmark Shelbourne Hotel -- including troubled developer Bernard McNamara (pictured right) -- injected an additional €7.1m into the company that controlled the property during 2007 after the cost of refurbishing the premises spiralled to €125m.
Mr McNamara is a shareholder in Kantaka Enterprises, the parent firm of Shelbourne Hotel Holdings (SHH), having been part of a group of eight investors who acquired the landmark property in 2004 for about €140m. They spent a further €125m -- significantly more than originally budgeted -- refurbishing the property.
Accounts just filed for SHH, for 2007, show the company had a capital deficit of almost €30m at the end of 2007, up from €14.7m in 2006, while it had term loans totalling €116m which were repayable within one to two years.
The accounts also show that Mr McNamara stuffed almost €1.2m into SHH in 2007, leaving him being owed €12.7m by the company. Of the other investors, developer Bernard Doyle stumped up a further €1.2m to bring his outstanding loans to the company to €6m. Developers David Courtney and Jerry O'Reilly each put in about €1.2m, bringing the loan balances owed to them to €6m each. Blackshore Holdings, the company owned by Galwayman John Sweeney, put another €2.35m into SHH in 2007 to bring its tally to €12.7m.
Many of the Shelbourne's owners have been struggling in the downturn.
This week, Mr McNamara was described as a person "no longer of significant wealth", as he unsuccessfully fought the granting of an order instructing him to pay €62.5m to investors involved in the purchase of the Irish Glass Bottle (IGB) site in Dublin.
Mr McNamara has said his "head is on a plate" and resigned from the company his father originally founded, Michael McNamara and Company.
A subsidiary of Blackshore Holdings, Fate Park, went into examinership last year owing creditors €17.3m. Fate Park had extended €20m in credit to Blackshore.
Last year, Barclays Bank went to the High Court seeking repayment of €9m in loans from David Courtney and Bernard Doyle. SHH was also embroiled in a legal case last year against the operator of the Shelbourne, Torriam Hotel Operating.