Friday 20 April 2018

NAMA to spend €2bn over four years in bid to kickstart jobs

Donal O'Donovan

Donal O'Donovan

THE National Asset Management Agency has said it plans to spend €2bn over the next four years on projects which could create up to 25,000 construction jobs and a further 10,000 non-building jobs.

The mini-stimulus package for the country's large cities was announced by NAMA chairman Frank Daly during a speech in Galway.

He said NAMA intended to finance schemes aimed at completing partially built commercial and residential projects and to develop some sites from scratch.

Some of the schemes are already up and running. NAMA has already lent €13m to complete the Charlestown Shopping Centre in Finglas, Dublin and €10m that is funding a project to complete an apartment block at the Beacon South in Sandyford, south Dublin.

NAMA does not have to borrow to roll out the new programme. The funds will come from the agency's cash reserves of €4.3bn -- money that comes from property rents, interest on NAMA-held loans and property sales.

It will be advanced as fresh loans to developers, as well as to receivers appointed by NAMA to run some of its properties.

The plan is to focus on developments in the main urban centres of Dublin, Cork, Limerick and Galway.

In particular, NAMA and the IDA have identified shortages or threatened shortages in the kind of large, high-spec, city-centre offices favoured by multinationals such as Google and Facebook.

Deals like this will follow on from the successful €100m sale of Google's giant headquarters in Dublin's docklands area last year. That building project was completed with fresh loans from NAMA to developers Treasury Holdings and secured hundreds of jobs for the city.

"Our view is that long-term prospects for much of this property are good," Mr Daly said. "On that basis, we propose to invest, particularly over the next three years, with a view to ensuring that this property is available to meet commercial and residential demand over the rest of the decade."

As well as cash for construction, NAMA can help with expertise on planning, sales and lettings and with essential infrastructure activity in various locations, Mr Daly added.

The new initiative is in line with NAMA's mission and with some previous lending done by the agency. However, spending €2bn over four years is a significant step-up in activity -- particularly in Ireland, where to date it has advanced €500m to developers to build out projects.

NAMA says the package could create as many as 35,000 jobs in construction and allied trades. However, in reality the number of jobs filled at any one time is likely to be a fraction of that because the projects will not run simultaneously.

Yesterday in the Dail there was a broad welcome for the scheme. But there was some concern among opposition TDs that highly indebted developers could stand to benefit as NAMA advances new loans for projects that are idle but still owned by the builders.

But a spokesman for the agency said: "After what has happened over the last two years, I find it hard to believe that anyone still thinks NAMA is soft on developers."

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