Nama chairman sees growing signs of stability in property market

There are growing indicators that the commercial and residential property markets are stabilising, chairman of the National Asset Management Agency Frank Daly has said.

In an end-of-year statement, the agency, which began taking over property development loans from the collapsing Irish banks almost three years ago, said it has taken in approximately €6.9 billion from property sales by debtors or receivers.

A further €3.6 billion approximately in rent has been taken in from properties controlled by debtors and receivers.

During 2012, the agency was linked with property sales totalling €3.1 billion.

Sales transactions have been completed in relation to more than 3,900 properties to date and a further €1.5 billion worth of property is on the market either through debtors or receivers.

The agency took in a total of €4.4 billion during 2012, including €1.3 billion related to rent and other non-property disposal sources.

Agency remains profitable

Despite the fall in property values during the period since its inception, and what it calls its prudent impairment policy, the agency remains profitable.

It made a net profit after tax in the six months to the end of June last of €222 million.

A detailed impairment review is being carried out and its conclusions will be reflected in the full 2012 audited accounts, which are expected by mid-2013, the agency said. It produced a net profit after tax of €247 million in 2011.

In relation to its €2.5 billion investment plan, the agency said it has to date approved €1.7 billion in advances to debtors, of which €1 billion has been drawn down.

The agency said it completed its first vendor finance transaction during 2012 and that more are in the pipeline and nearing completion.

Vendor finance deals involve the agency providing loans to the purchaser of a commercial property.

On its 20 per cent deferred payment scheme, which protects buyers against falls of up to 20 per cent in the value of their proprieties, the agency said it has agreed sales on more than 100 properties with a value of €18 million and will extend the scheme on a phased basis during 2013 to a maximum of 750 properties.

The initiative had been targeting 295 properties in 12 counties. The agency also said it has approved rent abatements, or rent reductions, totalling €13.5 million for commercial tenants.

Up to the end of 2012 it had granted 212 applications for rent abatement, with only eight of the 276 applications received to date being refused.

The remaining 56 are currently under review.

Nama has identified close to 3,900 residential properties it believes could be used for social housing.

The final decision in relation to the suitability of such properties rests with the local authorities.

To date local authorities have said 1,484 of the properties are suitable for social housing. A further 841 are being evaluated.