Irish Move Into Empty Offices Escalates Bust Legacy Battle
Liam Mullaney
Aidan Crawley/Bloomberg
“We are taking it back for the people of Cork,” Liam Mullaney, a 35-year-old spokesman for the group, which is linked to the Occupy Cork movement, said in an interview in the government-controlled building.
“We are taking it back for the people of Cork,” Liam Mullaney, a 35-year-old spokesman for the group, which is linked to the Occupy Cork movement, said in an interview in the government-controlled building. Photographer: Aidan Crawley/Bloomberg
Stapleton House
Aidan Crawley/Bloomberg
Instead of using Stapleton House’s 25,000 square feet (2,300 square meters) for offices and stores, the activists plan to create a cafe, creche, library and music school.
Instead of using Stapleton House’s 25,000 square feet (2,300 square meters) for offices and stores, the activists plan to create a cafe, creche, library and music school. Photographer: Aidan Crawley/Bloomberg
The Interior Of Stapleton House
Aidan Crawley/Bloomberg
Instead of using Stapleton House’s 25,000 square feet (2,300 square meters) for offices and stores, the activists plan to create a cafe, creche, library and music school. The
Instead of using Stapleton House’s 25,000 square feet (2,300 square meters) for offices and stores, the activists plan to create a cafe, creche, library and music school. The Photographer: Aidan Crawley/Bloomberg
A new front in the battle for Ireland’s empty properties has opened up.
Before dawn on Christmas Day, activists took control of an unfinished six-story glass-fronted building in the city of Cork called Stapleton House. Instead of using the 25,000 square feet (2,300 square meters) for offices and stores, they plan to create a cafe, creche, library and music school for community groups. They already hosted a ceili, a traditional Irish dance.
“We are taking it back for the people of Cork,” Liam Mullaney, a 35-year-old spokesman for the group of about a dozen protesters that seized the government-controlled building, said in an interview at the site. “It belongs to the taxpayers.”
Mullaney and his group are putting an Irish twist on the Occupy Wall Street movement, which began in New York and has spread to cities around the world, and highlighting Ireland’s record number of empty properties, or so-called ghost estates and orphan sites. About 20 percent of Ireland’s office space is vacant, double the European average, according to estimates from CBRE Group Inc. (CBG)
The loans that financed the building in the center of Ireland’s second-largest city are now controlled by the National Asset Management Agency, set up by the government in 2009 to rid banks of toxic commercial property assets, a person familiar with the matter said. He didn’t want to be identified because the information on ownerships is private.
Unwanted Buildings
Ireland’s landscape is dotted with empty and unfinished buildings, started during the decade-long real estate boom that ground to a halt in 2008. Commercial real-estate prices have fallen as much as 65 percent since the market peaked in 2007, according to CBRE, deterring developers from putting more unwanted properties on the market.
The asset management agency, known as NAMA, has bought 11,500 real-estate loans related to 16,000 properties since it was set up, Chairman Frank Daly told a parliamentary committee on Sept. 9. The Dublin-based body had more than 1,000 assets listed for sale when Occupy Cork took over Stapleton House, one of the most potentially valuable commercial buildings in the city of 127,000 people.
“Walk around any town in Ireland and you can see empty office and retail space,” said Rob Kitchin, director at the National Institute for Regional and Spatial Analysis in Maynooth, a town west of Dublin. “The maxim developed in the U.S. is minimize the loss, maximize the profit, do as much as social good as you can, but it’s not always that simple. Ultimately, NAMA needs to get its money back from somebody and somewhere.”
‘Unique Landmark’
Padlake Ltd., a Cork-based company, was listed as the owner of Stapleton House. According to public documents, Padlake controlled the property and Anglo Irish Bank Corp. registered a charge against the premises on Oct. 26, 2006. Padlake was dissolved on Feb. 5, 2011, the documents show.
In a listing for the property, Dublin-based DTZ Sherry FitzGerald describes the building as a unique landmark development offering “one of the most modern working environments in Cork’s commercial district.”
It would have 21,000 square feet of retail space and 4,000 square feet of offices when fitted out, according to DTZ Sherry. Right now, the walls are bare and the concrete floors echo with the sound of the activists readying the building for its gradual opening. The activists say the building has been lying idle since about 2008.
Legal Options
“In situations where the asset, which is security for a loan, isn’t being protected, NAMA will examine all available legal options to protect the asset,” the agency said in a statement. A spokesman declined to comment on the Cork building.
NAMA was created to purge banks of 74.2 billion euros ($94 billion) of commercial real-estate loans, for which it paid less than half that. The agency approved asset sales totaling 6.2 billion euros, Chief Executive Officer Brendan McDonagh said last month. It’s scheduled to complete its work by 2019.
When the real-estate bubble burst, Ireland was left “with a hell of a hangover that will take some time to resolve,” said Brian Hayes, a junior minister, in a speech today. “Nobody wants a return to the excesses of the wild years -- the toxic brew of crazy borrowing by developers, the mad and bad lending by banks, the poor to non-existent bank regulation and worse politics.”
‘Can of Worms’
After obtaining a key, Mullaney’s group chose to occupy the property on Oliver Plunkett Street to “open the can of worms” surrounding NAMA and fuel an anti-bondholder campaign that has so far failed to catch fire in Ireland.
“People couldn’t relate to us sleeping in tents on the street,” said Finbarr O’Connor, a former construction worker who is working to open the building. “This makes more sense to them.”
The occupation of Stapleton House is an escalation of a campaign which has seen activists camp in the streets of Cork and in Dublin outside the country’s central bank. Mullaney said he wants his move to set a precedent.
The Occupy Dublin movement says it may seek to follow the lead of their Cork colleagues, while activists in Belfast took over an empty building this week that used to house a Bank of Ireland Plc office in the city.
‘Occupy Belfast’
Activists unfurled a banner reading “Occupy Belfast” and supporters hoisted supplies to them via ropes. A police jeep sat outside the building.
Dublin-based Bank of Ireland was one of six lenders saved by the state in 2008, when the government guaranteed most of the bank industry’s liabilities after the financial system almost collapsed. Displayed on one of Stapleton House’s glazed windows is a list of bank bonds the government has agreed to redeem.
The most potent symbol of the real-estate meltdown is in Dublin, about 260 kilometers (160 miles) northeast of Cork.
The unfinished eight-story office block on the city’s North Quay was meant to be the headquarters of the former Anglo Irish (ANGL) before the company came close to collapse in 2008. The lender bankrolled many of the developers that fueled the boom and was only saved by a 30 billion-euro bailout from the government.
The site was abandoned four years ago and investors visiting the city routinely ask cab drivers to take them by the shell, McDonagh, the head of NAMA, told lawmakers on Oct. 26.
“The Anglo building is the most toxic image of the Celtic Tiger years,” said Paschal Mahoney, 47, an architect in Dublin who wants to turn the building into a so-called vertical park. “We have to acknowledge we have made mistakes. We don’t do that by simply brushing them under the carpet.”
To contact the reporter on this story: Dara Doyle at ddoyle1@bloomberg.net.
To contact the editor responsible for this story: Andrew Blackman at at ablackman@bloomberg.net.
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