Property had nil value, says developer

DEVELOPER RAY Grehan claims that he chose not to disclose his ownership of a property in Canada to the National Asset Management Agency because it had a nil value, according to a source close to the insolvent businessman.

Mr Grehan did not disclose the existence of the €1.2 million property in the business plan that he submitted to Nama.

The apartment at The Residences in the Ritz-Carlton tower in Canada was uncovered in a worldwide asset search by forensic accountants working for Nama.

The source close to Mr Grehan claims he transferred the property, which is the subject of a court action by Nama in Canada, to a company to save on stamp duty. Mr Grehan declined to comment.

Nama took legal action to reverse the transfer of the property from Mr Grehan to a company called 2295661 Ontario Inc on November 17th, 2011 – eight days after Nama secured a judgment of €269.6 million against him in the Irish High Court.

He obtained two mortgages from a Canadian bank to buy the property, which Nama claimed was transferred last month “with the intent to defeat, hinder, delay or defraud creditors of Grehan”.

The agency asked the Superior Court of Justice in Ontario to have the transfer of the property declared “null and void, and set aside as a fraudulent conveyance”.

The Canadian court has frozen the transfer of the property and made it subject to the Irish court judgment against Mr Grehan.

He does not intend challenging the Canadian action on the basis that he claims there is no equity left in the apartment given that it has fallen in value to the level of bank debt owing on the property.

Nama said Mr Grehan bought the property on August 16th, 2011.

He initially opposed Nama’s application for judgment in the Irish courts, responding with affidavits on September 7th and October 27th before then consenting to the judgment on November 9th.

Nama secured orders in the Irish High Court earlier this week enabling the agency to move against Mr Grehan’s UK assets.

The agency is also seeking the sale of an apartment which it claims Mr Grehan owns in the One Hyde Park development in London to reduce his debts.