FF senator owes €13m in loans for property deals
Published 06/11/2010 | 05:00
A FIANNA Fail senator who borrowed heavily to fund his property empire now has liabilities of more than €13m -- but assets of just €430,000.
Francie O'Brien, who has been a member of the Seanad since 1989, owns several development sites in his native Monaghan and others in Cavan, Tipperary and Mayo.
The Commercial Court heard a statement of affairs for Mr O'Brien earlier this week, in which his assets were given as €430,000, while his liabilities amounted to €13.3m. The vast bulk of that sum was borrowed for property development.
He receives a Seanad salary of around €70,000 but his register of interests shows no other income. Senators are not allowed to serve in the Seanad if they are declared bankrupt.
Mr O'Brien was part of a consortium that repeatedly assured Ulster Bank that it would get rezoning for a 50-acre site in Cavan town.
But he and two fellow investors have been hit with a €12m judgment after Ulster Bank became concerned about their ability to repay the loans it had extended to them.
Mr O'Brien is now set to face questions about how his consortium -- which included former Irish Nationwide boss Michael Fingleton -- could give assurances to Ulster Bank about the land being rezoned.
The Commercial Court heard this week that Ulster Bank had been assured throughout 2009 that the lands outside Cavan town would be rezoned from residential to commercial but it was now concerned about the defendants' ability to achieve that rezoning.
Mr O'Brien and his fellow investors failed to get permission to build 433 houses on the 50-acre site at Swellan, just outside Cavan town, which they bought for €11m in 2005.
The other investors included two Monaghan property developers -- Noel Mulligan, from Castleshane, and Charles McGuinness, from Tully House -- as well as Mr Fingleton.
The site they bought is zoned for residential housing development. But locals believe it would require considerable excavation, due to its hilly terrain.
A local councillor said: "You might as well buy a mountain. It would cost millions because they would have to level it."
There is currently a major over-supply of housing in Cavan, with 147 'ghost estates' countywide, according to a recent government report.
Cavan County Council only granted permission for an 82-bedroom nursing home to be built on the site last month. That has been appealed to An Bord Pleanala by local residents.
The value of the 50-acre site has collapsed by more than 90pc since it was bought for €11m in 2005. It is now worth an estimated €750,000.
In total, Mr O'Brien has borrowed more than €7m from Irish Nationwide for the purchase of land and properties in Cavan and Monaghan in loan deals agreed by Mr Fingleton.