DEVELOPER BERNARD McNamara, who alleges he faces potential claims of more than €108 million (€140 million including interest to date) arising from the more than €400 million purchase of the Irish Glass Bottle site in Ringsend, Dublin, has brought his own action against the Dublin Docklands Development Authority (DDDA) over the site purchase.
Because of a High Court finding last year that the DDDA acted outside its powers in fast-tracking permission for another docklands development at North Wall Quay, the DDDA was never entitled to enter in November 2006 into an agreement involving Mr McNamara and developer Derek Quinlan related to development of the Ringsend site, Mr McNamara claims.
The DDDA was now unable to perfom its obligations under that agreement and had therefore frustrated the ability of Mr McNamara and others to develop the site, meaning very substantial losses for them, it is alleged.
Mr McNamara claims he faces potential claims totalling more than €108 million on foot of loans raised from Anglo Irish Bank and private investors with Davy Property Holdings Ltd and on the basis of guarantees given by Mr McNamara related to those loans.
The proceedings by Mr McNamara, Ailesbury Road, Ballsbridge, Dublin, and his company Donatex Ltd, Pembroke Road, Ballsbridge, against the DDDA were admitted to the Commercial Court yesterday by Ms Justice Mary Finlay Geoghegan.
It is expected there may be another application next week to admit to the Commercial Court separate High Court proceedings by Ringsend Property Ltd against Mr McNamara and Donatex.
Mr McNamara claims the Dubin Port Company and South Wharf plc had, in September 2006, advertised the Irish Glass Bottle site for sale by tender. The site was the largest in Dublin 4 for years to become available for development, he said.
He claims then DDDA chief executive Paul Maloney had approached him a month later about becoming involved with the authority and submitting a bid for the site. Mr McNamara said he initially indicated he was not interested as he believed it would not be possible to generate a profit from the site.
He claims Mr Maloney had further meetings with him and made several representations, including that the DDDA could procure a route for the Luas to the site and that the DDDA, as planning authority for the area, could “fast-track” any application for permission for development without the planning risk of third party observations or appeals to An Bord Pleanála.
Mr McNamara claims, as a result of such representations, he later indicated he would be prepared to consider a joint bid with the DDDA for the site. Becbay Ltd was later incorporated and used by himself and the DDDA to bid for the site. Mempal Ltd, a company controlled by developer Derek Quinlan, also later acquired an interest in Becbay. In November 2006, Donatex held 41 per cent, Mempal 33 per cent and DDDA 26 per cent of Becbay.
In late January 2007, Becbay’s tender was accepted and it acquired the site for more than €400 million with funds of some €288 million from Anglo Irish Bank (later converted into a joint facility provided by Anglo and Allied Irish Bank), €57.5 million from Donatex, €32.1 million from the DDDA and €46.3 million from Mempal. Mr McNamara claims it was a condition of the loans to Becbay he provide a guarantee for €41 million of the sum advanced to Beebay and also for 41 per cent of all interest payable by Becbay.
The funds provided by Donatex were sourced from private clients of Davy Property Holdings Ltd.
