# NAMA set to pay developers



## canicemcavoy (28 Jun 2010)

http://www.examiner.ie/ireland/nama-to-pay-salaries-expenses-to-developers-123606.html#ixzz0s91I18cM




> BAILED-OUT developers are set to receive salaries and expenses from NAMA, it has emerged, but the toxic bank last night insisted it would not be supporting lavish lifestyles.


 
I'm not sure how NAMA can claim not to be supporting lavish lifestyles. Even developers who are currently in severe financial trouble seem to have no problem jetting to Marrakesh. I hope this is the final nail in the coffin of the idea that NAMA isn't a bailout.
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## DrMoriarty (28 Jun 2010)

Unbelievable. Where do these guys get their _cojones.._?


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## TLC (28 Jun 2010)

I know where they get the _cojones_ - they've taken ours!


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## aristotle (28 Jun 2010)

NAMA should not be paying this to developers, or if they feel they need to in order for certain developments to be completed then it should be as a loan.


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## DrMoriarty (28 Jun 2010)

How about they get a loan from the wives and family members into whose names they've transferred millions of euro worth of personal assets?


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## Smart_Saver (19 Jul 2010)

Dr. M.  - Namas a question i have been thinking a lot of recently and it sprung to mind big time again with todays latest outlay to the banks. The Sunday Tribune ran a piece on who the big guys are who owe the money. Apparantly Seanie is not 1 of these (small pig in a big pen) although his position and practice was at the heart of it.

http://www.tribune.ie/article/2010/jul/18/the-nama-republic-the-first-10-developers-to-go-in

What is the situation on the following say - simple query - 
Say someone of these above had been defaulting on payments but at same time had been putting other assets/money aside - Can we (i.e. Nama I guess) go after any assets/money that have been passed by these people to their relatives ? 

Call me cynical but I do believe that these people saw a lot of this coming and maybe transferred after the fact to keep them in the style they have been accustomed to.


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## AlbacoreA (20 Jul 2010)

Why would Nama be paying a developer for anything?


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## elcato (20 Jul 2010)

NAMA will give a developer who has insufficient funds to complete a building a loan so it can be sold, rented out etc. They will then hopefully have enough on completion to get their loan back with interest plus whatever they paid for the actual takeover in the first place. Of course it could sell for less and they will be stung.


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## aristotle (20 Jul 2010)

The contentious point is that NAMA will pay "management fees" to the developers i.e. money directly to the developer much in the same way as a wage. Its not just money so that he can buy labour and raw materials to finish the development.


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## Sunny (20 Jul 2010)

Someone has to project manage the development so NAMA would have to pay someone anyway if they decide to finish a project. I have no problem with paying a developer to do it as long at is a fair price.


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## canicemcavoy (20 Jul 2010)

Ah, but what's a "fair price". I imagine that billionaire developers have a different concept of that to me or you.


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## aristotle (20 Jul 2010)

Sunny said:


> Someone has to project manage the development so NAMA would have to pay someone anyway if they decide to finish a project. I have no problem with paying a developer to do it as long at is a fair price.


 
They are bing given a chance to finish a developement and sell it which will eliminate their debt. For that I think the developer should work for free.


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## csirl (20 Jul 2010)

Sunny said:


> Someone has to project manage the development so NAMA would have to pay someone anyway if they decide to finish a project. I have no problem with paying a developer to do it as long at is a fair price.


 
But, if these loans were still with the banks, the banks would not be paying for the project management.


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## Sunny (20 Jul 2010)

aristotle said:


> They are bing given a chance to finish a developement and sell it which will eliminate their debt. For that I think the developer should work for free.


 
What do we care if they make a profit as long as they pay off all their debt. They still have to pay back the money that NAMA hand over to finish the development including working capital amounts such as wages etc. 




csirl said:


> But, if these loans were still with the banks, the banks would not be paying for the project management.


 
Yes they would if they thought they would get their money back. Banks give working capital loans to struggling businesses that owe them money all the time if they see the potential to be repaid in full.


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## aristotle (20 Jul 2010)

Sunny said:


> They still have to pay back the money that NAMA hand over to finish the development including working capital amounts such as wages etc.


 
Thats what I am not clear about, where did you get that information? So its a loan they are getting?


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## Sunny (20 Jul 2010)

aristotle said:


> Thats what I am not clear about, where did you get that information? So its a loan they are getting?


 
As far as I know, the developer has to send in a business plan. NAMA have said, they will advance money to finish projects if they are financially viable and offer the best chance for NAMA to recoup the debt. I am assuming in the business plan under expenses, wages not only for the actual builders but for the devlopment management team as well are included which is normal for any ongoing business. I am open to correction but I thought it was just working capital loans that NAMA were advancing.


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## elcato (21 Jul 2010)

> I am open to correction but I thought it was just working capital loans  that NAMA were advancing


I would say you are correct but what sells newspapers is sensational statements like the OP posted at the start.


> but the toxic bank last night insisted it would  not be supporting lavish lifestyles.


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## canicemcavoy (21 Jul 2010)

elcato said:


> I would say you are correct but what sells newspapers is sensational statements like the OP posted at the start.


 

"BAILED-OUT developers are set to receive salaries and expenses from NAMA, it has emerged, but the toxic bank last night insisted it would not be supporting lavish lifestyles."

Which is the bit that is "sensational", exactly?


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## Chris (21 Jul 2010)

canicemcavoy said:


> "BAILED-OUT developers are set to receive salaries and expenses from NAMA, it has emerged, but the toxic bank last night insisted it would not be supporting lavish lifestyles."
> 
> Which is the bit that is "sensational", exactly?



I would say the part that developers will receive salaries from NAMA. As already pointed out, NAMA will issue working capital to developers it thinks can actually turn around a development. 

Not that I think that NAMA will be able to judge this correctly or turn out to be anything but a failure, but from the style of reporting it sounds like NAMA will pay wages to developers like employees.


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## canicemcavoy (21 Jul 2010)

The spokesperson themselves said they may support "modest living expenses" for developers. In effect, a salary. Using the term "salary" for "living expenses" is hardly sensationalism.


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## elcato (21 Jul 2010)

> supporting lavish lifestyles


 suggests that developers will be able to live the high life thanks to NAMA.


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## AlbacoreA (21 Jul 2010)

elcato said:


> suggests that developers will be able to live the high life thanks to NAMA.



I think most people would wonder why they even need modest living expenses rather than minimal, or simply the same as SW benefits. Pay them through a community scheme or similar.


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## canicemcavoy (21 Jul 2010)

elcato said:


> suggests that developers will be able to live the high life thanks to NAMA.


 
Er, try quoting the entire sentence:

"BAILED-OUT developers are set to receive salaries and expenses from NAMA, it has emerged, but the toxic bank last night insisted it would not be supporting lavish lifestyles. "

So, the paper is saying that developers will receive salaries and expenses. The bank denies these will be "lavish". That does not mean the paper was saying they were "lavish".


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## Smart_Saver (21 Jul 2010)

Hi,
can anyone shed any light on the question I asked on this?
i.e.  this is hypothetical I know... but..

Say someone in the top 10 has been defaulting on bank payments but at same time had been putting other assets/money aside. 
Can we (i.e. Nama I guess) go after any assets/money that have been passed by that person to their relatives in the form of houses in their relatives names, pensions etc?


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## Sunny (22 Jul 2010)

GoMayoGo said:


> Hi,
> can anyone shed any light on the question I asked on this?
> i.e.  this is hypothetical I know... but..
> 
> ...



You can but it's difficult. You need to prove that the assets were moved with the sole intention of avoiding creditors.


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## elcato (22 Jul 2010)

> Er, try quoting the entire sentence:
> 
> "BAILED-OUT developers are set to receive salaries and expenses from  NAMA, it has emerged, but the toxic bank last night insisted it would  not be supporting lavish lifestyles. "
> 
> So, the paper is saying that developers will receive salaries and  expenses. The bank denies these will be "lavish". That does not mean the  paper was saying they were "lavish".


Incorrect. Any quotes in it from a NAMA spokesperson does not mention lavish. Answering no to a question from a reporter such as "Will this not mean the developer will have a lavish lifestyle thanks to NAMA" does not mean they quoted the word lavish, the reporter did. Lavish lifestyle is purely for sensationalism.


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## canicemcavoy (22 Jul 2010)

elcato said:


> Incorrect. Any quotes in it from a NAMA spokesperson does not mention lavish. Answering no to a question from a reporter such as "Will this not mean the developer will have a lavish lifestyle thanks to NAMA" does not mean they quoted the word lavish, the reporter did. Lavish lifestyle is purely for sensationalism.


 
You're indulging in semantics. The core issue is that NAMA are paying developers a salary/living expenses.


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## elcato (22 Jul 2010)

> You're indulging in semantics. The core issue is that NAMA are paying developers a salary/living expenses.


You started it ....



> "BAILED-OUT developers are set to receive  salaries and expenses from NAMA, it has emerged, but the toxic bank  last night insisted it would not be supporting lavish lifestyles."
> 
> Which is the bit that is "sensational", exactly?


Your original statement was 



> I'm not sure how NAMA can claim not to be  supporting lavish lifestyles. Even developers who are currently in  severe financial trouble seem to have no problem jetting to Marrakesh.


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## Chris (22 Jul 2010)

canicemcavoy said:


> The core issue is that NAMA are paying developers a salary/living expenses.



No, the core issue with Nama is that it exists in the first place. The next issue is that they are actually entertaining the idea of making more loans to developers. If the developers cannot get funding on the open market then there is a very good reson for this, and the state should not second guess this credit-worthiness. 
And the media are focusing on the inaccurate statement of salaries being paid by Nama to developers, and how lavish or unlavish these will be. Has anybody seen an indepth media analysis on what will happen when (not if) Nama fails? In the grand scheme of Nama, focusing on whether a developer will be able to pay himself €50k or €500k a year is completely irrelevant.


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## canicemcavoy (22 Jul 2010)

> No, the core issue with Nama is that it exists in the first place


 
Well, I agree you there certainly. Interesting to watch Peter Mathews eviscerate property tycoon Frank Fahey over this point at the Dail committee yesterday:

http://www.youtube.com/watch?v=wNFbl525fkM


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## Slash (27 Jul 2010)

csirl said:


> But, if these loans were still with the banks, the banks would not be paying for the project management.



That's the whole point. That is why Fianna Fail set up NAMA in the first place, so they could determine what happens to their FF-friendly property developers. By transferring loans to NAMA (a FF institution), FF can ensure their pals are treated well end even provided with a salary, out of which they can continue to make contributions to FF.

Of course, every time I wrote about FF, a certain AAM moderator jumps to FF's defence. Wait for it..................


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## DrMoriarty (8 Dec 2010)

[broken link removed]


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