NAMA gives funding to developers

Amhran Nua

Interesting article in the Independent here:

NAMA gives first cash to developers

Nama, the toxic loans agency, has extended its first-ever funding to the country's developers as they struggle to finish projects around the country.

The agency declined to name the developers who received the capital or the amounts they received. "NAMA has provided small amounts of urgently needed working capital to support a number of projects to date,'' said a statement from the agency. A number of developers are now expected to seek permission from NAMA to roll over huge debts in the next few weeks. NAMA said yesterday it would decide on these when staff review the business plans of the developers.

It is likely that major developers will now be forced to sell unprofitable or underperforming assets, following a review of their business plans. While NAMA is anxious to avoid a fire-sale of development land, trophy assets which are in the red are under scrutiny.

Some of the top 10 developers have had business plans sent back because they are not judged to be realistic enough. However a number of plans are still outstanding. They disclose huge indebtedness and extensive breaches of loan covenants.

Asked on which criteria the working capital is being made available, a Nama spokesman said: "Funds required to complete projects will only be provided if, in Nama's view, the projects make sense and this assessment will be carried out as part of the review of each borrower's business plan."

Anyone have any information on who, how much, or what criteria were used to decide whether or not a project "makes sense"?

Scarab80

Amhran Nua wrote: »

Interesting article in the Independent here:

Anyone have any information on who, how much, or what criteria were used to decide whether or not a project "makes sense"?

No and you won't get any information outside of press releases as NAMA are not subject to FOI requests for some bizzare reason.

Hopefully the Information Commissioner will keep pushing to get this rule changed.

danman

Projects that are ongoing and are viable.
In other words, they have tennents in place after completion.

If money isn't released to these projects for completion, the tenents agreements will be null and void, so the investments made so far will revert to being toxic instead of viable.

There are a number of these type of projects ongoing that I know of.

As for FOI requests.
These are still active loans and NAMA is an agency managing these loans.
Publishing details would be akin to publishing the details of your bank account or your mortgage.

Should the privicy of one be less than the privacy of another?
And please, think before answering that question.

Scofflaw

danman wrote: »

Projects that are ongoing and are viable.
In other words, they have tennents in place after completion.

If money isn't released to these projects for completion, the tenents agreements will be null and void, so the investments made so far will revert to being toxic instead of viable.

There are a number of these type of projects ongoing that I know of.

This was always going to be a feature of NAMA - development projects needing working capital - but it's one that needs to be carefully watched to the extent possible, otherwise it can go down the road of lending money to keep failing projects on life-support rather than wrap them up. Mind you, that's probably what the banks would have done, and without any form of oversight or prevention.

cordially,
Scofflaw

dunsandin

Scofflaw wrote: »

This was always going to be a feature of NAMA - development projects needing working capital - but it's one that needs to be carefully watched to the extent possible, otherwise it can go down the road of lending money to keep failing projects on life-support rather than wrap them up. Mind you, that's probably what the banks would have done, and without any form of oversight or prevention.

Like Anglo really?The lender being us mugs, the failing project being anglo in general. Even Lenihan is starting to express his doubts, and if ever there was a man devoid of doubts, Brian is the ONE. Its all black and white to him it seems. Grey creeps in, with enlightenment.

Nody

danman wrote: »

Should the privicy of one be less than the privacy of another?
And please, think before answering that question.

If they want privacy that is not a problem; all they have to do is pay of their loans. If not I expect public scrutiny of the spend of public money. I especially expect that scrutiny when it is a shell company set up intended to hide the royal ****e that FF put in place (see the previous threads on the set up, the low payoffs at start until the next government, the creative accounting done to claim it will make a profit after 10+ years and yet fail to meet the claimed numbers in the first six months etc.).

Liam Byrne

Scofflaw wrote: »

This was always going to be a feature of NAMA - development projects needing working capital

:eek: I don't remember it ever being said that NAMA would operate as a bank and offer ADDITIONAL loans ?

Can you provide a link that shows "it was always going to be a feature" ?

danman

Nody wrote: »

If they want privacy that is not a problem; all they have to do is pay of their loans. If not I expect public scrutiny of the spend of public money. I especially expect that scrutiny when it is a shell company set up intended to hide the royal ****e that FF put in place (see the previous threads on the set up, the low payoffs at start until the next government, the creative accounting done to claim it will make a profit after 10+ years and yet fail to meet the claimed numbers in the first six months etc.).

There are still many viable loans ongoing.
Have a look around your town/city. Of there is any commercial projects ongoing at present, they need funding.
These loans are not toxic. They are viable.

There is actually a problem in the commercial construction sector at present.
NAMA are taking over some of these loans, and while the process is ongoing, funds are not being released.
Contractors and suppliers are not being paid, and that is having massive knock on effects.

Some projects are grinding to a hault. The effect of this is that completion dates my not be accomplished. Resulting in penelties and even withdrawal of tennents.

These loans are no different to your mortgage. They are perfectly viable.
Should the details of these loans be published?
Of course not.
They are entitled to their privicy as much as you are with your mortgage.

Your assertion that they are not paying of these type of loans, or all the loans going into NAMA is wrong. NAMA is taking in viable loans as well as toxic.

The commercial construction sector isn't the same as the housing sector. The housing sector brought all the speculators. The commercial sector has and still is viable.
In fact, it's only the commercial sector that is now still ongoing to any degree.

Zamboni

The biggest transfer of wealth in Irish history from the masses to an elite few continues without a single gunshot.
And yet we sit back and watch...

beeno67

Liam Byrne wrote: »

:eek: I don't remember it ever being said that NAMA would operate as a bank and offer ADDITIONAL loans ?

Can you provide a link that shows "it was always going to be a feature" ?

From NAMA itself.

http://www.nama.ie/Publications/2009/NAMAPresentationNov2609UCD.pdf

danman

Liam Byrne wrote: »

:eek: I don't remember it ever being said that NAMA would operate as a bank and offer ADDITIONAL loans ?

Can you provide a link that shows "it was always going to be a feature" ?

Liam, loans for commercial projects are the same as loans to build your own house.
You don't get a lump sum at the start and spend it how you like.
For a house, you get a payment after the ground works, foundations roof completion etc.

Commercial projects are no different. The loans weren't paid in one lump sum. As the project progresses, funds are released. I assume that the total cost of the loan is transfered, but the funding will have to continue to be released.

Should all funding to viable projects cease?

Liam Byrne

danman wrote: »

Should all funding to viable projects cease?

No, but who defines "viable" ?

I mean, those involved view Anglo as "viable", and I don't trust them.

And it's now our money

danman

Liam Byrne wrote: »

No, but who defines "viable" ?

I mean, those involved view Anglo as "viable", and I don't trust them.

And it's now our money

it's actually quite simple.
I'll give you an example.

One of the projects I'm involved with at present has 2 very large tennents lined up to move in on completion.

They will have signed a long term tennents aggreement.

If this project isn't completed, the tennents will not take over the building.
The monies spent up untill now will be lost.

There are many projects of this nature around the country.

Scarab80

danman wrote: »

As for FOI requests.
These are still active loans and NAMA is an agency managing these loans.
Publishing details would be akin to publishing the details of your bank account or your mortgage.

Should the privicy of one be less than the privacy of another?
And please, think before answering that question.

The FOI Act does not allow for an individuals details to be made public, there are specific exemptions contained in the Act for these types of requests.

How is it that Revenue and the Department of Social Welfare who hold personal financial information on every citizen and employee in the state are subject to the FOI Act - note that they haven't been distributing personal information to every hack who asks - but NAMA are not?

If NAMA works it may well be credited with saving the economy, if it doesn't the figures involved dwarf those of the bank recaps. Some general performance information such as percentages of loans being repaid, percentage completion of developments under which loans are held etc should be available to a concerned public.

danman

I agree with that, but the post at the start wanted information on particular loans, including the viable loans. Presumably so that we could agree if they are viable.

I don't agree that individual loans should be under public scrutiny.

Companies that are having their viable loans transfered to NAMA have no choice in the matter. In fact, it is these loans that will subsidise the toxic loans in the short term.
They shouldn't be under public scrutiny.

Liam Byrne

danman wrote: »

One of the projects I'm involved with at present has 2 very large tennents lined up to move in on completion.

They will have signed a long term tennents aggreement.

If this project isn't completed, the tennents will not take over the building.

OK - I can see where you're coming from. Now can you start spelling it "tenants", please ? I'm getting thirsty.....

danman

Liam Byrne wrote: »

OK - I can see where you're coming from. Now can you start spelling it "tenants", please ? I'm getting thirsty.....

Sorry about that, my dyslexia raising to the surface again.
It is Friday evening, perhaps it is time for a pint. Although give me anything but that stuff...!!!!!

johnnyskeleton

Scofflaw wrote: »

This was always going to be a feature of NAMA - development projects needing working capital - but it's one that needs to be carefully watched to the extent possible, otherwise it can go down the road of lending money to keep failing projects on life-support rather than wrap them up. Mind you, that's probably what the banks would have done, and without any form of oversight or prevention.

cordially,
Scofflaw

Thank god that there are publicly appointed representatives there to protect the interests of the taxpayer.

Scofflaw

johnnyskeleton wrote: »

Thank god that there are publicly appointed representatives there to protect the interests of the taxpayer.

That our systems of public oversight need some work is inarguable, but we would have had no right to oversee such activity or to interfere with it in the case of the banks doing it, and the economic effects would have been similar.

cordially,
Scofflaw

jmayo

Liam Byrne wrote: »

:eek: I don't remember it ever being said that NAMA would operate as a bank and offer ADDITIONAL loans ?

Can you provide a link that shows "it was always going to be a feature" ?

Reminds me how Microsoft started describing bugs in their software as Features. :mad:
Sounds much better. :rolleyes:

danman wrote: »

I agree with that, but the post at the start wanted information on particular loans, including the viable loans. Presumably so that we could agree if they are viable.

I don't agree that individual loans should be under public scrutiny.

Companies that are having their viable loans transfered to NAMA have no choice in the matter. In fact, it is these loans that will subsidise the toxic loans in the short term.
They shouldn't be under public scrutiny.

I think what is worrying me if not most of the "NAMA/recapitalisation/bailout at any cost" sceptics is that the same people telling us that NAMA will only lend to viable projects are the same ones that told us Anglo had to be saved, that it wouldn't cost much and indeed that the fundamentals were sound way back in 2007.

See where I am coming from ?

danman

I know what your saying.
But I can only really speak about the projects that I am involved in. I know that upon completion, they are viable projects. If they don't get funding, they will fall into the toxic catergory.

I can't say whether all projects that will get continuing funding are viable as I'm not involved with those.