BATTLE COMMENCES this morning (Tuesday) in the High Court between Treasury Holdings and the National Asset Management Agency (NAMA), which seeks to put three dozen key assets of the leading international property developer into receivership.
The stakes are high for Sligo, maybe for decades to come, as one of the dispute properties is the site of the 80 million euro town centre development centred on Debenhams proposed 46,000 square feet plan over three storeys.
Debenhams was pencilled in to open by Christmas 2013, with a Treasury spokesman stating in Sligo in recent months that construction would get under way in late March 2012 and warned that if it didnt happen in the first quarter of 2012 it was unlikely to happen at all.
Beyond Commercial Rescue
The ferocity of the High Court struggle between the two Titans was amplified in a front page report at the weekend in The Sunday Business Post. The newspaper reported that Treasury will accuse NAMA of of acting in a misleading, unreasonable and commercially sharp manner. The report indicated that Treasury's case will also deal with threat of ''significant'' job losses arising, it says, from the receivership. As many of 300 jobs in Ireland may be affected
Treasury has lined up an expert witness, The Irish Times reports this morning (Tuesday). The assessment of Dr Michael Cragg, is believed to be that Nama’s behaviour was “opportunistic” and risks the “destruction of value” of the assets involved when potentially “viable acquirers exist”.
NAMA, in turn, will mount a robust justification of its actions. "It is understood," said The Sunday Business Post, "that NAMA will tell the Court that it had lost patience with Treasury, and that the business is insolvent and 'beyond the point of commercial rescue.'" The report additionally suggests that Treasury's recent 600 million euro proposed rescue was adjudged by NAMA to "not fulfil commercial requirements."
Two Sligo projects affected
The future of ambitious plans for Sligo town centre by Treasury subsidiary, Callside, could well be decided, one way or the other, by this Liston-versus-Ali heavyweights ding-dong in the High Court. Treasury has also indicated it may raise Constitutional issues surrounding the appointment of a receiver.
A second Treasury Sligo project is likely to be affected by the 36 properties listed for receivership. 'Sligo Nazareth' is an estimated 12 acres sited behind Nazareth House/Rosehill Estate, with an entrance off the Inner Relief Road.
Commenting to members of Sligo Borough Council earlier this month, the Council's Director of Services, Paula Gallagher told members four days were anticipated for the High Court hearing. It would depend on that, she said "but if there is no change everything is as before."
Members had previously agreed to receive monthly progress reports from the Director of Services.
'Debenhams wont wait'
Treasury's Director of Real Estate and Development, Niall Kavanagh, addressed Borough Council members last September: “If Debenhams falls I don’t see a bright future for this scheme” warned Mr Kavanagh, adding: They wont wait years and years to build.”
The revised Debenhams planning application had removed apartments and “could” accommodate a library and viewing platform. He re-stated a start date for first quarter of 2012 adding:: “If we fail to make this date, it is unlikely to happen at all.”
Mr Kavanagh told the Borough Council members: “The development must be de-risked to secure funding."He re-confirmed Christmas 2013 was Treasury’s hope to have the first phases open for business."
An appeal by Tesco against the Debenhams development is also due to be decided by An Bord Pleanala (ABP) by February 28th next. However such dates are often only indicative and the decision could be a later date. Pleanala has invited a number of parties to make submissions, including An Taisce and Failte Ireland. Tesco lost an appeal to Pleanala last winter against the proposed Penneys development fronting onto O'Connell Street, its current premises and former TSB. Penneys plan a new store of 52,000 square feet across two storeys fronting O'Connell Street, rising to four storeys over a basement story at rear of extended site.
Inside the past month, Tesco has proposed partial demolition of its current supermarket and construction of a four storey building to include new entrance in the Wine Street car park and a two-level supermarket. The details are contained in a planning submission included in members' report at Monday night's General Purposes (GP) meeting of Sligo Borough Council.