US property developers in talks with Dublin City Council (DCC) to rescue its stalled housing projects were alarmed by a statement from the Minister for Housing which implied that the controversial regeneration plans had been abandoned.
Minister of State Michael Finneran sent a statement to the media on Thursday, responding to the city council's announcement that it had reached a €1.5m "mutual understanding and agreement" with developer Bernard McNamara whereby he is to withdraw from the projects he was awarded. Finneran's statement, which was issued by his office just hours after the Boston-based under-bidder had left "a very constructive meeting" with DCC, called for the tenants of three estates scheduled for regeneration to be re-housed elsewhere.
"We think there's been a mistake made in the press release," said Miles Byrne of Corcoran Jennison, partners of Irish construction companies Pierse and Bennett in the original competition for four of the contracts. "The minister seems to be confused about the termination of negotiations with McNamara. We're excited about going forward with these PPPs. We believe we can do it and we're going to be reconvening the meeting with DCC in two weeks."
Five public-private partnership (PPP) projects ran aground last May when McNamara claimed the terms of the development contracts had been effectively rewritten by new energy-saving regulations and increased space specifications. The potential for litigation by either side forced DCC and McNamara into "a mediation process" in relation to three projects.
DCC announced on Thursday that McNamara is to release the sites and design licences for the projects, plus pay €1.5m towards costs incurred by the council. It added that a new team was examining options for future regeneration. However, Finneran's statement, issued by his office, seemed to contradict that by implying that all hope of regenerating the five estates was lost.
"The developers and DCC have committed time, resources and effort to make these projects work but in the context of declining house prices ... it was just not possible ... in the manner originally intended. Most importantly, the tenants ... have had their hopes disappointed and every effort must now be made to ensure that alternative, good quality accommodation is found for those households who now wish to move from these estates."
Corcoran Jennison has proposed to DCC that it will build the developments financed by bank loans which DCC will pay the company to service. On completion of the construction work, the company would remain in situ to manage the estates.
Sunday Tribune
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