Wolves at the door three years after the million euro wedding
Many people seeking judgements for the return of their money
IT was 11 April 2008. Not quite the height of the boom, but you never would have known it had you been one of the 180 lucky guests at the wedding of developer Gerry Cosgrave to Paula Dollard at Ashford Castle.
Money was no object at the lavish three-day affair and it showed. Right from the moment they stepped out of the limousines and off the helicopters that brought them to the historic Mayo venue, the wedding guests found themselves being wowed at every turn by the excesses heaped upon them by their deliriously happy hosts.
From the five-song set performed by Westlife at a reputed cost of €250,000 to a barnstorming performance by Dickie Rock, those assembled in the matrimonial marquee (a replica of Dublin VIP nightclub, Krystle) barely had time to catch their breath in between the bottles of champagne that flowed freely for three days straight.
Mr Cosgrave -- the larger-than-life and by all accounts immensely charming cousin of the well-known Cosgrave developers -- wore a special suit for the ceremony and reception. For the rest of the weekend (which friends say easily cost more than €1m), the smile rarely left his face as he drank in the company of his nearly 200 closest friends and clients, who indulged in golf and clay pigeon shooting in between endless rounds of fine dining, drinking and dancing.
The bride, meanwhile, was said to be in her element. Freshly tanned from a pre-wedding break in Dubai, the new Mrs Cosgrave whooped it up at the reception in her wedding gown and very nearly danced her Jimmy Choos' off such was her clear delight with the day she and professional wedding planner, Franc, had for months prepared with military precision.
For those not fortunate enough to make it to the Cosgrave-Dollard nuptials, the all-expenses paid and no expense spared event was, naturally, captured in all its glory on a three-hour commemorative DVD filmed by professional videographers.
It's a movie that some of those who invested with Gerry Cosgrave and Romanian property specialists RI Investment Group (RIIG), now say they look at it in a very different way. Now the bubble has burst, a number of those who gave their millions to Mr Cosgrave and his business partners and availed of the free champagne in the early hours of the morning at Ashford Castle (and on another occasion at the five-star Puente Romano Hotel in Marbella) are asking where their money went and when they'll get it back.
Before the world was turned upside down, Mr Cosgrave was known to a select coterie of south Dublin's professional elite as the 'go-to guy' if you had a spare €100,000 or even a million that you wanted to put to work.
"You were earning 5 per cent on your money in the bank. You gave it to Gerry and you got a 25 per cent return. Who wouldn't do it?" one investor asked the Sunday Independent, by way of explaining the attractions of Mr Cosgrave and his business. "When I was popping open bottles of champers in the pub, my friends wanted to know what the celebrations were for. When they heard how much money I had just made, they wanted a piece of the action too."
At its dizzying peak, the Donnybrook-based developer and his partners' company, RIIG, confidently boasted in correspondence to their Irish investors of having upwards of €80m in net assets on its balance sheet.
With a concentration on investing in the nascent Romanian property market, RIIG, for instance, claimed in one investor letter in 2008 that it was capable of generating cash of up to €25m with the disposal of a single site it owned on the Boulevard Basarabia in Bucharest. And for anyone anxious to see their initial investment returned, it added how it had "comfortably geared" sites that would facilitate equity release sufficient to repay its investors.
Three years on and with Europe on its knees economically, RIIG has unsurprisingly suffered from plummeting property values and a chronic lack of funding for development from the banking sector. In the case of one site owned by the RI Investment Group in Timisoara, Romania, one experienced developer with knowledge of the market there estimated that its value had fallen from its peak valuation of €40m to €2m.
But if Gerry Cosgrave had indeed lost his concept of reality during the property boom, it is very much in the process of being restored thanks to the pressure now being brought to bear by a number of clients whose loans and investments he and his associates have so far failed to repay.
Among those now impatiently awaiting or actively seeking the return of their money are a high-profile Dublin restaurateur who is owed more than €400,000; a leading Dublin publican, who is owed €1m; household names from the music industry, each of whom invested more than €1m in Romania; and a south Dublin businessman who loaned €1m to Mr Cosgrave in June 2008 with the mouth-watering promise of a 25 per cent return.
In the case of the south Dublin businessman, the Sunday Independent understands there is something of an added incentive for him in seeking the return of his investment.
"It might sound crazy now, but he borrowed the €1m that he gave to Gerry from the bank. Now the bank wants the money back," a friend of the businessman says.
While the businessman in question secured a judgment for €1.25m against Mr Cosgrave in the Commercial Court in December 2009 and secured an order for a bankruptcy summons against him this summer, his trek down the legal route has, so far, failed to bear any fruit.
And while Mr Cosgrave's solicitors wrote to him two weeks ago with a promise from their client that he would come up with a "programme of repayment" by October 27 next, there has been no further indication of what this programme might entail.
Contacted by the Sunday Independent last Thursday and asked how he intended to repay the south Dublin businessman and the many other wealthy and previously wealthy individuals who invested in his property ventures, Mr Cosgrave declined to comment.
In a brief statement, he said simply: "In order to protect the interests of third parties, whose rights and affairs would be adversely affected by my engaging with the media, including ongoing High Court proceedings, I am not in a position to comment on any matters of a commercial, or business nature."
Not that Gerry Cosgrave is the only one being sensitive about his business and those he has been doing business with.
In the case of the high-profile Dublin restaurateur for instance, numerous phone calls from the Sunday Independent over the course of two days went unanswered and were not returned. Only a chance face-to-face meeting with the restaurateur next to his place of business saw him confirm -- albeit rather sheepishly -- his ailing €400,000 investment with Mr Cosgrave.
Any hope that he and his fellow investors might have harboured of profiting from their investments or even seeing their initial investment returned to them would appear to be slim at best.
And even if an economic recovery were to come, Mr Cosgrave's investors would probably need to form an orderly queue to get their money back.
Quite apart from the €1.25m judgment the south Dublin businessman has against the developer, several other judgments have been granted against Mr Cosgrave personally to investors and Irish banks.
Records held at the Registry of Deeds show four judgment mortgages registered against the developer's Donnybrook home.
Of these, three judgment mortgages are noted as being in favour of AIB and Bank of Ireland. In the case of AIB, it secured judgment mortgages for unspecified amounts on August 31 and December 3 last year.
Bank of Ireland, for its part, secured a judgment mortgage for an unspecified sum on February 15 last.
The fourth judgment mortgage against Mr Cosgrave's Dublin 4 home was granted on April 16 last year to Romanian Private Equity Projects Ltd, a Cork-based group of investors who loaned €5m to a Romanian company, SC Optim Real Imob (Scori) and a Luxembourg company called Bacau Finance.
Having given personal guarantees in relation to the loan along with three other business partners, Mr Cosgrave found himself liable for its repayment.
The matter briefly hit the headlines last December when one of those partners -- developer Paddy Kelly's son Simon -- consented to a €2.5m judgment against him in the Commercial Court.
In the course of those proceedings, the court heard that the three other businessmen -- Gerard Cosgrave, Alan Torpey and Paul Doody (a brother of former Bond girl Alison Doody) -- had previously undertaken to repay the Cork investors their original €5m loan, plus €1.8m in interest on two separate occasions, firstly by May 20, 2009 and then by September 30, 2009. It was stated in court that the money remained unpaid.
Contacted by the Sunday Independent and asked how they intended to repay these and other monies to their investors, both Mr Cosgrave and his business partner Alan Torpey declined to do so on the grounds of protecting the interests of third parties, saying they could not comment on any matters of a commercial or business nature.