Southern Cross plan is debated
Councillors spent over an hour debating a site in Southern Cross, Bray, which could be used to develop shopping facilities in the area.
Wicklow County Council received €14.4m in 2008 after Nechouka purchased 2.29 acres at Southern Cross as they wanted to locate a Superquinn on the area.
They were granted planning permission for a mixed use development on a combined site including the 2.29 acres and another nine acres.
As part of the lease agreement a clause was included to impose penalties if construction on site did not commence within year one as agreed, at a cost of €100,000 per annum.
However, no construction works took place because of the 2008 recession. In 2016 Nechouka wanted to vary the lease agreement to facilitate the sale of the site. They proposed to pay the full €778,000 owed to the local authority in penalties, on the condition that the lease agreement would be reduced to €1 per year from 2017 to 2022. This would allow for a purchaser of the site to prepare a fresh planning application, allow for any potential appeals to An Bord Pleanála and also allow time to secure the necessary funding. If the development isn't completed in that time then a further €500,000 will be accrued.
Councillors had requested independent legal advice, which found the matter was a reserved function for the members to decide upon.
Cllr John Ryan said: 'This is a significant variation being sought and it should have come before the members to begin with. We have to get what is the best value for money for the council and use every leverage to get development at Souther Cross. Construction of so many houses without services is the wrong way to carry out development.'
Cllr Ryan proposed that the €778,000 owed to the council should be paid immediately. The abatement fee over a five-year period would then drop to €1 per year, but if development hasn't taken place by 2022, Wicklow County Council will receive an additional €500,000. Under his proposal the €778,000 would go back to Bray Municipal District.
Cllr Michael O'Connor was against any variation. 'Essentially this is suggesting that we give this crowd another chance. Since requested to pay €100,000 a year, they haven't done so. Plus now they want us to give them until 2022. It is pretty clear that they have no intention of doing anything with the land. They are going to sell it off for a profit themselves. This will just give them time to asset strip that land at a bigger price.'
He proposed a further 12 months and if development hasn't started in that time, the penalty kicks in again in full and all outstanding monies are paid to the local authority.
Cllr Joe Behan said that an international vulture fund Starwood Property Trust Inc was now involved.
'They bought from Ireland's bad banks. €30bn of taxpayers' money was lost because of the irresponsibility of the banks. Starwood sat back and waited for the markets too improve. Now they are saying "we will pay you what we owe if you give us another five years so we can make a maximum profit". This vulture fund wants to flip the land. They benefited from the taxpayer when they purchased the portfolio from Nama. Now they want to benefit from the Wicklow taxpayer as well.'
Cllr Jennifer Whitmore said: 'they bought that lease and took the risk on it. It is not our responsibility to negate the loss they incurred. They are looking for the people of Wicklow to subsidise them if we sign this lease abatement.'
Cllr Pat Vance said: 'if the building goes ahead then the people up in Southern Cross will have the shopping facilities promised to them but not delivered for over 20 years. Also the €14.4m paid for the site was astronomical, even in 2008.'
Cllr Tom Fortune said: 'We are owed €778,000. If a business owed that to a financial institution there would be a received put in and they would be pinned to the wall. This whole deal doesn't make any sense.'
Cllr Christopher Fox shared the reservations over the involvement of a vulture fund, but didn't feel this was the main crux of the matter. 'I am surprised some people are portraying this as a bad deal. We got €14.4m for a piece of land the size of a football pitch. Now a further €778,000 is the cherry on top.'
Cllr Ryan's proposal was the first to be voted for by the elected members, with 17 in favour, 13 against and two not present. As his proposal was accepted, there was no need to vote on other proposals made.