Coillte has held talks with property developers and has identified up to 300 hectares of its land that may be suitable for building thousands of new homes.
The State forestry agency, which on Thursday reported a strong set of financial results with earnings up 10 per cent to more than €98 million, says it does not intend to develop any houses itself.
Its chief executive Fergal Leamy says it is prepared, however, to partner with private developers and local authorities to provide land for residential building projects. It would then acquire alternative sites for forestry purposes.
Mr Leamy said it has identified sites at locations including in Cork, north of Dublin and in the west of the country that might be suitable for housing, as part of the Government’s overall plan for up to 50,000 new homes on public sites.
From Coillte’s total land holdings of 450,000 hectares, it has identified 15,000 hectares that are not suitable for forestry and will be put to other use.
From this, it has zeroed in on “200 or 300 hectares” located close to population centres that would suit housing.
Planning
“We have drawn up plans with developers about what you could do with those sites, how to get it through planning. At some point, we would enable the land to be developed, and we would acquire replacement land for our purposes.”
Average suburban housing density is in the region of 50 units per hectare, suggesting that if fully built out, Coillte’s land could accommodate 10,000 to 15,000 new homes. Mr Leamy stressed the plan is at a very early stage.
“But as a State-owned agency, we should be enabling initiatives that meet public policy needs,” he said.
Coillte has worked closely with the Department of Housing Minister Simon Coveney on the plans. The two men have worked together in the past, when Mr Leamy was his special adviser.
Coillte has also entered the market for financial products with the launch in recent weeks of Coillte Premium Partners. The State currently pays subsidies to some farmers for 20 years to grow forests.
Boosting cashflow
Coillte is offering to continue the same annual cash payments for up to another two decades to the farmers after their original 20 years with the State are up. In return, it will take three quarters of the wood crop when the forests are felled.
It has hired a team of salespeople to bring the plan to landowners.
Coillte on Thursday announced its cashflow more than doubled in 2016, with a 25 per cent increase in the State’s dividend to €6.2 million. Refinancing of its debts saved it €3 million annually on its interest bill, which Mr Leamy said was “straight to the bottom line” as it focuses on boosting cashflow further.
It is also in the final stages of a restructuring that should see a total of well over than 100 staff leave the business, while it is also on target for the development by the end of the year of enough renewable energy on its lands to power more than 220,000 homes.
