THE COMPANY responsible for developing the convention centre in Dublin’s docklands saw its net debt rise by 32 per cent last year to €510 million, due to costs incurred in the construction of the complex in 2009.
Latest accounts for Spencer Dock Development Company Ltd (SDDC) also show its parent group Treasury Holdings has agreed to guarantee its liabilities until December 21st next. SDDC also relies on the support of the National Asset Management Agency (Nama) to continue in business.
These factors allowed the heavily-indebted business to retain its status as a going concern.
SDDC, which is developing 20 hectares in Dublin’s docklands in conjunction with State transport group CIÉ, was unable to repay €307 million in banking facilities last year.
It is relying on Nama to “renew and roll-over these facilities on broadly similar terms”, the accounts state.
Treasury, which is led by Richard Barrett and Johnny Ronan, has signed a memorandum of understanding with Nama. This means its business plan has effectively been agreed, although it has yet to be formally signed off by Nama.
Treasury transferred loans to Nama in April and May of last year.
Its listed subsidiary REO also recently received planning permission from the London mayor Boris Johnson for its Battersea power station and has agreed a debt-for-equity swap with lenders.
These were significant hurdles for Treasury to clear as its seeks to progress the Battersea scheme – its key development project.
SDDC made a total loss of €155 million in the 14 months to the end of February 2010. This included a €115 million writedown in its investment, development and trading properties.
The company’s operating loss amounted to €40.4 million. There was a deficit in shareholders’ funds of €64.6 million at the end of February last.
SDDC’s turnover declined to €9.3 million last year from €202 million in 2008.
SDDC achieved €197.7 million worth of property sales in 2008, just before the property crash. This dwindled to just €2.9 million in the 14 months to the end of February 2010. But rental income increased to €6.3 million last year from €4.4 million in 2008.
SDDC is developing the docklands site with CIÉ, under a “master development agreement” that is due to expire in 2012. It is understood that talks on a renewal of this plan have already begun between SDDC and CIÉ.
The value of SDDC’s investment properties declined last year to €176.9 million from €212.5 million in 2008. The value of its development properties more than halved to €44 million.
The accounts also show that former director Harry Crosbie, who runs the nearby Point Village, is due to be paid €10.9 million by February 28th this year relating to the extinguishing of rights relating to “structures” at North Wall Quay.
SDDC booked a charge of €6.5 million for a deferred lease incentive with a tenant agreed in 2007.In addition, in 2007 and 2008, SDDC agreed a deal with three new tenants to pay the rent and all the related property costs on buildings formerly occupied by those companies. A sum of €12.6 million was paid out last year in this regard.
SDDC declined to reveal the identities of the tenants involved due to “commercial sensitivities”.
The convention centre, which will be paid for by the Irish exchequer over a 25-year period, is the centrepiece of the Spencer Dock scheme. PricewaterhouseCoopers was the scheme’s first commercial tenant in 2007.
The original plan also involved 3,300 apartments.
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