Yet another developer files for UK bankruptcy
Landmark's Paddy Shovlin will have fresh start in 11 months' time
YET another of Ireland's biggest and most indebted developers has slipped the so-called 'Nama noose' and declared bankruptcy in the UK.
Landmark Enterprises chief Paddy Shovlin will have a clean bill of financial health on May 29 next, or just 11 months from now, notwithstanding the hundreds of millions of euro his companies owe, and the millions he owes Nama personally on foot of personal guarantees he gave in the course of borrowing a fortune during the boom.
Having been adjudged a bankrupt in London's High Court of Justice just four weeks ago, Mr Shovlin would incredibly already appear to be in the process of restarting his property career. Records relating to the developer's case filed with the UK's Insolvency Service describe him as trading under the name of Placepartner LCPM at the World's End Studios in Chelsea.
The fully serviced office is located just 20 minutes away from Mr Shovlin's present home in Coleridge Gardens. While it is unclear whether the developer owns the two-bedroom unit which the Insolvency Service records as his current address, the apartment commands a rent of £6,342 (€7,860) per calendar month according to the UK property database, Zoopla.
While Mr Shovlin was nearly as well known during those years for his love of racing Ferraris as he was for his developments, the unfinished shell of an apartment block at the Beacon South Quarter in Sandyford, Dublin, has since become the abiding image with which the Landmark Enterprises boss is most readily associated.
Thankfully, work at the development is expected to recommence shortly following a recent pledge by Nama to invest €11m there as part of its overall plan to pump €2bn into Irish projects between now and 2016.
While the agency's investment in the Beacon development is a welcome one, it is somewhat ironic given how Mr Shovlin and his co-directors at Landmark -- Pat and Anthony Fitzpatrick -- hold the dubious distinction of being the first developers against whom Nama secured judgements in the commercial court. In October 2010, Mr Justice Peter Kelly granted judgements in favour of Nama for €25m against Mr Shovlin and €12.5m each against the Fitzpatricks arising from personal guarantees they had given on a refinancing loan of €277.6m from Bank of Ireland for the Beacon development.
Asked by the Sunday Independent if it would look to challenge Mr Shovlin's bankruptcy, a spokesman for Nama said: "We monitor each bankruptcy proceeding very closely to decide on the best course of action to take. We make our decisions on a case-by-case basis. As a secured creditor, we are in a stronger position than other creditors."
While the spokesman declined to comment on Mr Shovlin's case specifically, it is understood that Nama paid prices specifically linked to the market values of the assets secured by the borrowings it took over from his banks. This should leave the agency in a position to recover the maximum amount possible once it realises the value of the Landmark chief's assets. It is also open to Nama to seek an attachment on Mr Shovlin's future earnings.
In availing of UK bankruptcy, Mr Shovlin joins the growing number of Ireland's broken property titans who have done so. Cork-born developer John Fleming was discharged as a bankrupt in the UK last November, having declared himself hopelessly insolvent and unable to repay his companies €1bn plus borrowings in November 2010.
Glenkerrin Homes chief Ray Grehan -- who famously paid €171m, or €84.5m an acre, for the former veterinary college site in Ballsbridge -- meanwhile, is looking at a fresh start by year-end, having been declared bankrupt in London on December 29 last.
Explaining his decision in an interview with this newspaper at the time, Mr Grehan said: "By doing this [declaring bankruptcy], maybe it will free me up from that and leave me in a better position to rebuild than staying on and allowing Nama to prolong that agony with a noose around my neck over the next several years."