Sunday 25 February 2018

Nama launches sales process for €7.2bn worth of soured loans

The Radisson Hotel in Galway
The Radisson Hotel in Galway
John Mulligan

John Mulligan

NAMA has started the sale of €7.2bn of non-performing loans, almost all of which are attached to properties in Ireland.

It is the single biggest tranche of non-performing loans put up for sale by the agency. It comes amid continuing fallout from its sale of the 'Project Eagle' portfolio of Northern Ireland loans last year.

The €7.2bn sale of loans just commenced by Nama is dubbed 'Project Arrow'.

According to industry finance publication Costar, there are 1,532 loans in Project Arrow attached to 367 separate borrowers.

The single biggest loan in the portfolio is for under €10m, and no property to which loans are attached in the portfolio has a value of more than €5m.

Of the properties in Project Arrow, 836, or 36pc, are in receivership, while 96pc of the total properties to which the loans in the portfolio are attached are in Ireland. Only 3pc are in the UK.

Costar said that €2.81bn, or 39pc of the nominally valued loans in Project Arrow are secured by residential properties. Another €2.52bn, or 35pc, are secured against mainstream commercial properties; while €1.73bn, or 24pc, are attached to land and development assets. Another 2pc, or €144m, are secured against hotel and leisure assets.

Nama has also reportedly chosen three finalists to progress to the final stage of its sales process for another portfolio of non-performing loans, known as 'Project Arch'.

The portfolio includes loans that were extended to five borrowers, including property developer Jerry O'Reilly, hotelier Terry Sweeney, and businessman Ronan O'Caoimh.

Mr O'Reilly once held a stake in Dublin's Shelbourne Hotel, and has a stake in the Radisson Blu in Galway. Mr Sweeney was part of the consortium that bought Superquinn in 2005 for €450m.

The Shelbourne is now owned by US property investment group Kennedy Wilson. Superquinn was sold by an examiner to Cork-based retail group Musgrave in 2011.

Mr O'Caoimh is chief executive of Trinity Biotech, an Irish company that develops and sells medical diagnostic kits. He co-founded the business, which is listed on the stock exchange in New York. He has been heavily involved in Ireland's property scene. Loans attached to a student residence in Dublin are the main interests linked to Mr O'Caoimh in Project Arch.

There are 77 properties attached to loans in Project Arch, with 72 of those properties in Ireland, three in the UK and two in the United States, said Costar.

The prime asset in Ireland against which some loans in Project Arch are secured is the Radisson Blu in Galway. The hotel was developed by Bernard McNamara, and Mr O'Reilly holds a stake in the company behind the property. Mr O'Reilly's loans in Project Arch also include debt facilities secured by the Kilkenny Ormonde Hotel.

CarVal Investors, Deutsche Bank with Alanis Capital, and Apollo Global Management are in the running for Project Arch, having made bids of between €150m and €160m.

Irish Independent

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