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Department of Public Expenditure raised concerns over renting of office block

Proposed €120m National Transport Authority deal sparks query over whether facility is too big

The Department of Public Expenditure raised 'very significant concerns' over a proposed €120m deal to rent offices for the National Transport Authority, saying the building seemed far too big and queried how a proposed sublet of one floor was supposed to work

Mon Jan 29 2024 - 16:47

A government department raised “very significant concerns” over a proposed €120 million deal to rent offices for the National Transport Authority (NTA), saying the building seemed far too big and queried how a proposed sublet of one floor was supposed to work.

The Department of Public Expenditure had been asked to give its approval for the planned move of the NTA from four separate offices into a single location in the Smithfield area of Dublin. In an email officials from the Department of Public Expenditure told the Department of Transport they had responded to a preliminary business case for the move with questions about “cost and affordability” but had received no answers.

One message said it appeared as if the proposal involved the lease of a building “far in excess of existing sanctioned staff numbers, [and] at a huge cost”. A senior official also said the deal seemed to envisage the NTA effectively becoming landlords and subletting part of the property. “It’s not even clear to me that they have the remit or sanction to undertake such a measure,” the official wrote.

The Department of Public Expenditure official said that in a 341-lease portfolio of State offices there were only three that were larger than what was being earmarked for the NTA.

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“There needs to be clear rationale, plan, strategy and robust assumptions regarding requirements, blended work and be fully clear on the net costs annually and how [Dept of] Transport are going to pay for it,” said an email.

The officials asked the Department of Transport for answers to no less than 18 separate queries, including whether the move had the backing of the Government.

Questions were also asked over how the NTA planned to increase its staff numbers by 53 per cent by the end of this year. There were also concerns over “increasing collaboration space by 100 per cent” and answers sought on whether alternative premises outside of the centre of Dublin were considered.

Another of the questions said: “The document refers to subletting a floor – is this proposed? Is it in the NTA’s remit to be a landlord and take on such a speculative role? Do you have examples of comparable approaches taken by other bodies so we can better understand the proposed model.”

The department also looked for reasons for why fit-out costs seemed so much higher than comparable projects.

The move was ultimately approved by Cabinet, with the NTA given the go-ahead for spending an estimated €120 million over the course of a 20-year lease for the Haymarket House building, which includes €20 million for the fit-out.

Asked about the project, a spokesman for the NTA said the lease for the building had been signed in May 2023 with a view to begin a “phased move” in this July.

He said: “Since the preparation of the preliminary business case the NTA headcount has continued to grow and now exceeds previous estimates. This is likely to result in the NTA utilising all existing office space in Haymarket House. The growth in NTA headcount is linked to Ireland’s increased unprecedented levels of activity in terms of investment in transport infrastructure and services.”

He said this included the management of three “mega-public transport projects”, BusConnects Dublin, the Metrolink, and the Dart+ Programme.

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