MILLIONAIRE businessman Sean Dunne came out fighting last night, after planners refused permission for his €1.5bn development in Ireland's most expensive suburb.
An Bord Pleanala refused permission for the high-rise development -- including a 37-storey tower -- in Ballsbridge in Dublin 4, sending a shockwave through the Irish banking sector.
Last night, Mr Dunne criticised the planning process as "a game of roulette" and said he would go back to the drawing board to submit a new plan for the site which cost him a record €380m four years ago, but could now take years to develop.
The decision to refuse permission in affluent Dublin 4 sent a shockwave through the banking sector as Ulster Bank -- the main backer of the scheme -- looks to revalue the land which was bought at the height of the boom.
Since then, the value of development land has fallen by up to 50pc, new office developments have plunged in price and office rents have dropped up to 10pc in the capital.
And although Mr Dunne has pledged to submit a new plan for the seven-acre site, the results of the auditors' assessment will lead to a ripple effect across the sector as lenders are forced to start slashing the value of land they hold as collateral.
Mr Dunne, who paid €380m for the seven-acre site containing Jurys and the Berkeley Court hotels in 2005, had hoped to build 536 apartments, retail and office space, shops, pubs, restaurants and a 232-bedroom hotel in Dublin 4, describing his ambitious plans as the 'Knightsbridge of Dublin'.
The development included 10 buildings ranging from 10 to 18 storeys in height, with plans to include a 37-storey 136-metre-tall tower at the centre of the scheme attracting the ire of local residents.
The Carlow-born developer last night said he had spent €15m on the scheme to date and that 970 construction jobs had been lost.
"The current system is lengthy, expensive, confusing and unworkable," he charged. "As the system stands, applying for planning permission has become a game of roulette. Local authorities, politicians, residents, planning inspectors, Bord inspectors and An Bord Pleanala are regularly at odds with each other as to what constitutes proper planning and development on any given site."
And he said he was "very disappointed" for local residents who would lose a community centre and sports hall because of the refusal.
He added that business was "thriving" at D4hotels.com -- the former Jury's and Berkeley Court -- and that the hotels would remain open for business "for the foreseeable future".
An Bord Pleanala refused permission for the scheme, saying it would constitute "gross overdevelopment" of the site.
Local residents last night demanded an investigation into why Dublin City Council granted partial permission for the scheme, saying Environment Minister John Gormley should investigate why city planners "forged ahead" with and actively encouraged the developer to pursue permissions which had no justification on planning grounds.
Mr Dunne recently told the 'New York Times' that he believed his ambitious plans could still succeed, despite the recession and property market crash.
He has the option of appealing the An Bord Pleanala decision to the High Court on a point of law, but last night indicated he would submit a revised scheme which would meet the zoning of the site, which is residential.
Mr Dunne has been involved in a series of high-profile court cases in recent weeks.
Earlier this week, a legal battle with prominent hotelier John Brennan over the ownership of an Internet domain name was settled out of court.
The pair were contesting ownership of the name D4hotels.com -- the name of the former Jury's Doyle hotel in Ballsbridge.
Also last week, it emerged that Mr Dunne was being sued by a firm of estate agents in a row over an allegation that he owed €1.5m in unpaid fees. He claims the money is owed by his company, Mountbrook Homes, and not him personally.
Late last year, the High Court found -- after a challenge by Mr Dunne -- that an €83m eight-storey office block development on Dublin's north quays should not have been built because the Dublin Docklands Development Authority (DDDA) had accepted land from the developer as part of a confidential deal which led to the building's go-ahead.
But developer Liam Carroll was granted permission by Dublin City Council to retain the building. It is unclear if Mr Dunne will take further action.
Paul Melia, Joe Brennan and Fergus Black