What does agency do and how might it change?

Nama, born in one cri­sis, will soon be given the pow­ers to help fix an­other

The Irish Times - - Home News - Barry O’Halloran

What is the Na­tional As­set Man­age­ment Agency (Nama)?

The Gov­ern­ment set up Nama in 2009 to take over prop­erty loans from the Repub­lic’s banks. The value of the prop­er­ties against which the debts were se­cured had col­lapsed, threat­en­ing the banks’ sol­vency.

What does it do?

It paid ¤31.8 bil­lion for the debts and be­gan man­ag­ing them, col­lect­ing re­pay­ments from the de­vel­op­ers who had bor­rowed the money. In cases where the bor­row­ers could not re­pay, it took over the prop­er­ties them­selves. When the mar­ket be­gan to re­cover four years ago, it started to sell the loans to other in­vestors, al­low­ing it to get the State’s money back.

Is it al­ready in­volved in pro­vid­ing hous­ing?

The agency has been work­ing with the Gov­ern­ment to pro­vide so­cial hous­ing. By the end of June this year it had iden­ti­fied al­most 7,000 prop­er­ties that it be­lieved were suit­able for this and de­liv­ered 2,398 of them to lo­cal au­thor­i­ties.

It has set up a spe­cial divi­sion, Na­tional As­set Res­i­den­tial Prop­erty Ser­vices, which takes own­er­ship of homes in ar­eas where there is an es­tab­lished de­mand and leases them to lo­cal au­thor­i­ties or hous­ing as­so­ci­a­tions. In a lot of th­ese cases, th­ese prop­er­ties are un­fin­ished, so it pro­vides the de­vel­oper or re­ceiver with the cash to fin­ish the work.

What else is it do­ing?

The agency has con­trol of about 2,800 hectares of land that can be used for new homes. In 2015 it pledged to build 20,000 new houses by 2020, more than 90 per cent of them will be in Dublin and its sur­round­ing coun­ties, where de­mand is at its strong­est, the rest will be out­side the cap­i­tal.

By the end of July it had fin­ished 5,300 of th­ese new homes. It was build­ing, or had plan­ning per­mis­sion for, a fur­ther 9,200, while an­other 9,500 were in the plan­ning sys­tem.

Nama was orig­i­nally set up as a lender, does it have the ex­per­tise needed to build homes?

It ac­quired this ex­per­tise as it went along. It now has a spe­cial­ist hous­ing divi­sion with staff who have a back­ground in this area. Its head of res­i­den­tial de­liv­ery is John Col­li­son.

Was Nama not meant to fin­ish its work and be wound up?

Yes, but the law estab­lish­ing the agency does not say when this should hap­pen. When it pub­lished its an­nual re­port for 2016 re­cently, Nama’s chair­man, Frank Daly, said that it would stay in busi­ness at least un­til the Ir­ish Glass fac­tory site was fin­ished, which he es­ti­mated would take it be­yond 2020.

Will the news that it is go­ing to have a greater in­volve­ment in hous­ing pro­vi­sion be wel­comed?

The Gov­ern­ment has faced calls from the Op­po­si­tion and else­where to turn Nama into a hous­ing agency, so the news should be wel­comed in some quar­ters. How­ever, when it an­nounced its orig­i­nal plans to build 20,000 new homes, a group of de­vel­op­ers, in­clud­ing Michael O’Flynn of O’Flynn Cap­i­tal and Pat Crean of Mar­let made a for­mal com­plaint to the EU on the grounds that this was a form of il­le­gal state aid.

Does the Gov­ern­ment’s an­nounce­ment mean that the leg­is­la­tion estab­lish­ing Nama will have to be changed?

This is not clear yet. The Act re­quires that Nama get the best pos­si­ble com­mer­cial re­sult for the State and its main aim is to get back the ¤31.8 bil­lion of tax­pay­ers’ money that it orig­i­nally used to buy the banks’ loans.

Nama it­self has not com­mented, but as it is a State agency, it will ul­ti­mately have to do what the Gov­ern­ment asks. Any change to the law will have to be dealt with by the Oireach­tas.

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