Nama developer pays €3m in fees to its directors over two years
Harcourt admits pay is 'a very sensitive issue'
NAMA builder Pat Doherty's Harcourt Developments paid its directors more than €3m in fees and other payments over the last two years, despite racking up huge losses at the property company.
Last month it emerged that Nama had paid almost €15.5m in salaries to 168 developers last year, with three earning over €200,000 and another 25 earning over €150,000.
Doherty, the Donegal builder who as a young man appeared in the Beatles video for Hey Jude, developed the massive Park West complex in west Dublin and is fronting the ambitious Titanic Quarter project in Belfast. He is a major hotelier, owning the Solis Lough Eske Castle in Donegal and the Wyndham Grand in Chelsea Harbour in London. His firm owns the five-star Carlisle Bay resort in Antigua. Harcourt is also involved with the operation of 40 Holiday Inn hotels in the UK as well as development projects in Las Vegas, the Bahamas and Jersey.
Harcourt Developments paid its directors fees of just over €1.25m last year and another €1.06m in 2010, according to company documents. Last year, Harcourt had eight directors including Pat Doherty, his son Nicholas and Brigadier Andrew Parker Bowles – former husband of Camilla Parker-Bowles, now wife of Prince Charles. In 2009, the year before hundreds of millions of loans were transferred to Nama, Harcourt's six directors shared a modest €584,000 or an average of just €97,300.
The payments to the Nama-backed property firm's directors were also bulked up by large advisory fees for certain board members.
"The company has paid consultancy fees to a number of directors in respect of services rendered during the year.
"Payments under these arrangements totalled €337,787," according to Harcourt Developments documents. In 2010, consultancy fees of €367,284 were paid to certain directors at the Nama client firm.
"We recognise remuneration levels are a very sensitive issue, especially during these difficult economic times," according to Harcourt's John Doherty.
"All Harcourt directors took a significant reduction in remuneration levels during 2011. Some of the existing senior managers were appointed to the board during the year, which resulted in a reclassification of costs in the accounts from wages and salaries to directors' fees but these were not additional expenses.
"Following the completion of new bank facility agreements in early 2012, there were further substantial reductions agreed in the directors' remuneration levels and these will be reflected in the 2012 annual accounts."
In 2010, Harcourt's borrowings from three of its Irish lenders were moved to Nama under the second tranche of loan transfers. The company had estimated that "in excess of €500m" would be transferred to Nama.
Last February, Harcourt successfully completed the restructuring of its loan facilities with Nama. This secures the group's financial position and outlines a strategy to repay its loans over an agreed time frame. All of the group's non Nama lenders continue to be supportive, according to the company.
"Nama has got a job to do," Doherty told a newspaper last May. "Everybody is complaining about them; all they want is their money back. You have to work with them, be straight and open. They know we've been running our business successfully for over 30 years," Doherty said.
In May, he revealed that Harcourt had been pressed by Nama to offload its Chelsea hotel. "Part of our arrangement with Nama was that we would sell a few things to reduce debt. That's why we're selling it. "
A Nama spokesman said, "The agency cannot comment on individual cases."
Sunday Indo Business