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Portmarnock falls to 25pc of its 2005 valuation after impairment

The owners of the well-known Portmarnock Hotel & Golf Links in north Dublin wiped €3.3m off the value of the four-star property in 2009, bringing its likely market valuation to as little as a quarter of its €70m price tag in 2005.

New accounts just filed for Natworth, a company controlled by directors of Capel Developments, show that in 2009 the hotel's value was impaired by €3.3m to bring its book value to €18.2m at the end of that year.

The hotel and its facilities, which employ more than 100 people, had been bought by Capel Developments in 2005 following stiff competition from developer Gerry Gannon and Treasury Holdings.

A further €10m was estimated to have been spent adding a spa and on refurbishment work. The golf course at the development was designed by German golfer Bernhard Langer.

The accounts state that the hotel complex -- which is unrelated to the older Portmarnock Golf Club members' course -- has been provided as security for a loan of €47.8m from AIB to Natworth's immediate parent firm, Potquality Investments. Natworth received a €5m loan from Potquality in 2009.

Loans related to the hotel were transferred to NAMA in July last year, note the newly filed accounts, while interest repayments on the loans are being rolled up.

Commenting about the transfer of Potquality's and a related firm's loans to NAMA last year, Natworth's directors -- Liam Kelly, John O'Connor and Edward Keegan -- said that they "cannot foresee how this may affect the availability of loan facilities to the group in the future".

The 2009 accounts note that the company's shareholders have indicated their desire to continue to support the group, including Natworth. The accounts add: "It is the shareholders' intention that the group's liabilities can be met from the medium-/long-term management of these assets and other assets of the shareholders. The impact of NAMA and the continuing decline in the property market are factors outside the control of the directors and shareholders."

Operating losses at Portmarnock Hotel & Golf Links were more than halved in 2009 to just over €400,000.

Irish Independent