End of line for Metro as €25m of property rented out
Published 06/08/2011 | 05:00
PROPERTIES bought as part of a €150m spending spree in preparation for Metro North are being rented out instead of demolished in a clear indication the project is doomed.
Rail chiefs spent €25m buying up properties on the ill-fated rail route, an Irish Independent investigation has found.
But most of the houses are being rented out in a clear sign the project will be scrapped.
The Railway Procurement Agency (RPA) spent €200,000 on refurbishing and maintaining the houses in the strongest indication yet that the Metro North project will be shelved.
The Government is expected to announce this decision in the autumn, due to the estimated final cost of the project which has been put at €2.5bn.
Documents obtained by the Irish Independent reveal the RPA's multi-million euro expenditure on Metro North, with most of the costs relating to the disastrous property purchases and large payments to consultancy companies.
Eleven houses near Croke Park, close to the city centre, were bought two years ago, along with the Catholic Institute for the Deaf.
Premium prices were paid even though the property market had crashed.
The purchases went ahead a full year before planning permission for the Metro project was granted by An Bord Pleanala in October 2010.
The project had been pushed hard by former Transport Minister Noel Dempsey, who at the time refuted predictions that the project would be shelved.
An RPA spokesman defended the purchase of the properties in advance of planning permission for the Metro.
He said the RPA had been sensitive to the needs of the owners in acquiring new accommodation.
Some of these properties are now worth less than half what was paid for them and the RPA has been forced to rent out many of then in a bid to recoup some cash from the purchases.
Four terraced houses on St Alphonsus Avenue were bought for between €623,000 and €661,000.
A similar house on the road is on the market with an asking price of €270,000.
Eight of the the properties are now being let by the RPA while two others are on the rental market. But so far the agency has only taken in rent of €62,000 -- after spending €200,000 on refurbishment.
Transport Minister Leo Varadkar last night lashed out at the " shortsighted and reckless policy " of the last government in spending massive amounts of money on planning such projects "without being sure that the money would be in place to construct them".
Almost €200m has already been spent on planning and preparatory work for Metro North, the DART underground, and the link-up of the two disconnected Luas lines in the city centre.
The RPA has now been ordered to "rein in" spending on planning and preparatory works for major public transport projects.
"The last government decided to spend huge amounts of money planning road and rail projects without being sure that the money would be in place to construct them."
The Fianna Fail-Green coalition was aware of and signed off on the €150m planning expenditure on the Metro and the purchase of the property portfolio, according to the Department of Transport.
The Drumcondra properties were all purchased by mutual agreement, and the compulsory purchase system was not employed.
"The cottages will have to be demolished, but not just yet," the RPA spokesman insisted.
But he added that even if the Metro project did not proceed in the near future the houses were in a "much sought after area of Drumcondra".
The new tenants are aware that the houses will be demolished if Metro North is ever built.