Property developer Seán Dunne says he could emerge debt-free from bankruptcy within six months in the US state of Connecticut, and his creditors, including the State-owned banks, are likely to receive, at most, 2 per cent of the roughly $500 million (€390 million) he says he owes them.
Mr Dunne filed for bankruptcy in the US late on Friday, blaming a move by Ulster Bank to initiate bankruptcy proceedings against him in Dublin last month over a debt of €164 million. The bank was the lead lender on his biggest project, the redevelopment of the Jurys hotel sites in Ballsbridge, which faltered at planning and was doomed by the property crash.
Speaking from his home in Greenwich, Connecticut, the Co Carlow developer said the purpose of his move to the US in August 2010 was never to file for bankruptcy but to be with his wife, the former newspaper columnist Gayle Killilea, and their children "and to explore new business opportunities".
He said he chose to file for bankruptcy in the US because he had concerns about the personal insolvency legislation and “the control that it proposed to give to banks over citizens in financial difficulties”.
The US bankruptcy court and the trustee appointed to liquidate his assets and distribute the proceeds among creditors would decide when he could be discharged from bankruptcy with a fresh financial start, he said.
“That is not my decision. The bankruptcy court and the trustee move at their own pace . . . It is a timing issue. In Connecticut, it can happen within six months.”
Mr Dunne said the value of his assets was “negligible” relative to his debts, which he estimated at “$500 million”. He estimated his assets to be worth $1-$10 million on his bankruptcy filing. “If it is $10 million, every creditor will get 2 per cent of what I owe them.”
One of the most ambitious developers during the Irish property bubble era, Mr Dunne joins other former big players such as Bernard McNamara and Ray Grehan, who have filed for bankruptcy outside Ireland to resolve their financial difficulties more quickly than they could in Ireland.
Mr Dunne, whose net worth was once estimated at several hundred million euro, had to undergo “credit counselling” with a non-profit budgeting agency as part of his US bankruptcy application.
He said he didn't know what effect his bankruptcy would have on the legal action taken by the National Asset Management Agency against him and his wife in the US or Ulster Bank's court proceedings in Ireland, because the US bankruptcy trustee "steps into my shoes and he makes the call".
Nama and Ulster Bank declined to comment on what it would mean for them.
The State agency, owed €185 million by Mr Dunne, took a legal action against him and his wife in Connecticut, seeking to reverse his transfer of a half-share in an apartment in Switzerland to Ms Killilea. The agency also claimed he was secretly behind multimillion dollar US property deals she was involved in.
A game of golf
Mr Dunne said, once discharged from bankruptcy, he hoped to rebuild his business "without the unnecessary hassle of Nama and other banks chasing me around the world". "I can always say to anyone that we did our best and came up short but now we move on," he said. "As in golf, life itself is always about the next shot."
He would love to build in Ireland again when it is possible, he said, but that there was no work or bank funding for property developers at present.
