Developers under pressure to pay debts
Published 10/01/2010 | 05:00
THREE of the country's biggest developers are coming under increasing pressure to service the massive borrowings associated with their property interests, according to accounts filed with the Companies Office last week.
Abridged financial statements filed for Radora Developments Ltd -- a company headed up by developers Bernard McNamara, Jerry O'Reilly and David Courtney -- show a massive €430,867,421 was repayable to the firm's banks "upon demand" at the end of November 2007.
A note attached to the accounts shows how the company, which was involved in the development of the Elm Park apartments in Dublin, only continues to operate as a "going concern", based on the continuing support of its shareholders and its principal lending institution.
The accounts also state that the directors are of the view that such support will be forthcoming.
Apart from the near €431m owed to the company's banks at the end of November 2007, the Radora Developments report shows an additional €22.8m was due to creditors outside the firm's group within one year.
News of the sheer extent of Radora's bank borrowings comes just three weeks after Varleigh Ltd -- another of the companies in which Bernard McNamara is centrally involved -- filed accounts showing bank borrowings of €59.64m due for repayment within the next two years.
As in the case of Radora Developments, Varleigh is now operating as a "going concern" based on the continuing support of its shareholders and banks.
Disclosures of the indebtedness of Mr McNamara's companies contained in their accounts are expected to feature prominently in the High Court this month when lawyers for a group of Davy Stockbrokers' investors will seek to have a stay on the imposition of an order for €63m judgement against the Clare-born developer lifted.
While Mr McNamara had sought the stay pending the outcome of an appeal to the Supreme Court, lawyers for the Davy investors will insist the €63m in loan financing should be repaid immediately on the basis of their belief that the developer's financial position is deteriorating.
In their affidavit, Davys' lawyers will argue that any delay in the repayment of the €63m will make it less likely that the investors -- who include former AIB chairman Lochlann Quinn and Glen Dimplex founder Martin Naughton among their number -- will recoup their money.
Elsewhere in the Irish property world, developer Sean Dunne would also appear to be coming under increased pressure as the recession continues to bite.
Accounts filed on December 8 last for the Carlow-born developer's company, DCD Builders, show how Mr Dunne's personal guarantees spiralled from €4m to more than €100m after he stepped in to secure several loans associated with his empire.
The accounts further show that Mr Dunne's group of companies owe €760m to their banks, while the developer is personally owed €170m, a sum he has agreed not to seek repayment of until December of this year at the earliest.