Friday, 20 November 2009

Dunne writes down value of hotel

Property developer Seán Dunne has written down the value of the Berkeley Court hotel in Ballsbridge by €35.3 million.

This represents a 28.6 per cent haircut on the €122 million paid by Mr Dunne for the 2.16-acre site in 2005 at the height of the property boom here. The hefty impairment charge is booked in accounts just filed by BCPHC, a company controlled by Mr Dunne.

The accounts also state that the company is in talks with its bankers, which include Ulster Bank, to ensure that “sufficient working capital will continue to be available to the company”. The accounts, signed off on October 29th last, state that the “estimated recoverable value” of the property is €87.4 million.

But it adds that “in light of the current market conditions, it is difficult to establish a reasonable valuation for the site”.

Mr Dunne’s revised application for his two hotel sites in Ballsbridge was rejected by Dublin city councillors last week. This setback and the continuing weakness of the Irish economy and property market could have put a further dent in the value of the Berkeley Court site.

Such were the uncertainties facing BCPHC that auditor KPMG said it was “unable to form an opinion” as to whether the accounts “give a true and fair view” of the company’s affairs at the end of July 2008.

KPMG highlighted four “significant uncertainties” facing the business. These were uncertainty over the revised planning application – since rejected – and the ability of the company to secure funding to develop the site.

The auditor also raised concerns about the difficulty of valuing the site in the light of the economic backdrop and raised questions about whether day-to-day funding can be maintained. Efforts to contact Mr Dunne and his representatives were unsuccessful last night.

Mr Dunne acquired the Berkeley Court and the Jurys Ballsbridge hotels from the Jurys Doyle chain in 2005 for a combined €379 million.

Mr Dunne planned to build a Knightsbridge-style high-rise mixed development, with a 37-storey tower as its centrepiece.

This plan was rejected in January 2009 by An Bord Pleanála.

The hotels were reopened by Mr Dunne and currently trade under the D4 brand.

Mr Dunne’s purchase of the Ballsbridge hotels was funded by a €326 million syndicated loan led by Ulster Bank.

This included an €84.1 million contribution from Icelandic bank Kaupthing.

Earlier this year, a leaked document to the board of Kaupthing, dating from September 2008, stated that the hotels had been valued at €520 million.

Mr Dunne provided a guarantee of €250 million to the banks, according to the document.

Irish Times

www.buckplanning.ie

1 comment:

Arslan said...

new version of Reservation Master and Reservation Master Pro is now available this version also includes the support of Window Vista a continues booking calendar and many other improvements.
http://twurl.nl/61kf5j
http://www.goldhillsoft.com/?hop=majid1973