Bank deal helps firm with €400k loo survive
A construction firm that splurged €400,000 on a derelict 'loo with a view' at the height of the building boom is only surviving today because its bank is rolling up its interest payments.
In 2008, owner of Galvin Construction Ltd, John Galvin bought the site containing the toilet block on Lahinch promenade "with unrivalled and unparalleled sea views" after his nearest bidder declined to go beyond the €400,000.
At the auction, when asked was he happy with the price paid, he said: "I would be happy if I got it for cheaper, but that's the way it goes."
However, the purchase occurred only three months before the collapse of Lehman Brothers in September 2008 and a collapse in property prices.
Now, new accounts show that the Co Clare construction firm had accumulated losses of €6.52m at the end of June 30, 2013.
The firm owed €6.7m in bank loans and overdrafts at the end of June last and the accounts just filed show that it recorded losses of €356,539 in 2013.
According to a note attached to the accounts, it states that "the company has significant bank borrowings relating to its development sites as well as its construction division".
The note states: "These facilities are on demand and in each case, the interest is currently being rolled up. The directors remain in continuous dialogue with its bankers with a view to renewing the bank facilities and securing continued interest roll-up, without which the company will not continue to trade."
The firm's development sites have been written down from a value of €4.3m in 2010 to €247,618 at the end of June last year.