# "NAMA can supply half of Dublin's housing demand"



## Brendan Burgess (4 Jul 2014)

This is from a speech today by Chairman of NAMA, Frank Daly 

Housing demand – NAMA’s response
It is clear that there is a real need and a real opportunity for residential development to meet the acute demand for new housing in Dublin and increasingly in the other main growth areas.    To illustrate the scale of this, current estimates are that Dublin needs 8,000 to 10,000 new houses and apartments a year – last year, it produced 1,600.

 NAMA can do a lot in this area.

Our analysis shows that NAMA sites have the capacity to deliver somewhere between 40% and 50% of Dublin’s residential demand over the next five years.   On what we call Tier 1 sites – sites that are shovel ready – we will deliver approximately 3,000 new residential units.  Half of these are already under construction.  On Tier 2 sites – sites with development potential over a short-term horizon – we have capacity for a further 19,000 new units.   And on top of all that, NAMA can call on an additional 500 hectares of development land, which could accommodate new units in Dublin if we can overcome planning and infrastructure impediments.   Furthermore in the counties immediately adjoining Dublin, NAMA is currently assessing the potential for delivery across 1,000
hectares of residentially-zoned lands.   

We are not sitting on our hands.

We have established a cross-functional residential delivery team within NAMA to identify the potential for and drive the delivery of new houses and apartments to respond to unmet demand.  We are well placed to do this and we should do this.  NAMA, given its public remit, has no intention of hoarding development land.  Instead, if there is an identified need for housing in the Dublin area – and there clearly is – we are not in the business of sitting on development land assets until their value appreciates as the supply shortage becomes more acute.  If a residential development project can break even or do better, then we will fund it.  Many of those who are interested in buying development land in the Dublin area at the moment will have rate of return targets of 15%-20% and realistically those targets are unlikely to be met unless market prices rise significantly from current levels.  Which means that they are unlikely to be in a position to initiate development projects in the near future.  NAMA, taking account of its public and societal remit as well as its commercial remit, can move more quickly to develop residential sites as soon as they become commercially viable.  What that means in practice is that we will be able to develop in the near term what might otherwise be developed in the medium-term.  We will therefore focus on the development land within our portfolio in a way that helps to meet the broader requirements of the economy and society.  This manifestly includes a requirement for increased housing output in the Dublin and Greater Dublin areas in particular. 

*Social housing*
I’ve just mentioned society and before I move off the topic of housing, I’d like to briefly touch on an aspect of our work that’s very important to NAMA – the delivery of houses and apartments for social housing.   I am on record as saying that where we can make properties available for social housing, it’s a win-win for everybody involved.    We have identified over 5,000 residential properties as being available and potentially suitable for social housing.  Local authorities have confirmed demand for about 2,000 of these. Whilst I am a little disappointed that take-up hasn’t been higher, I understand that local authorities are obliged to comply with their own policies on the location of social housing.  

We are working hard to deliver the properties for which demand has been confirmed. At the end of March, 684 had been delivered.  By the end of the year, that figure will be more than 1,000 and the remainder of the properties will come on stream over the course of 2015/2016.   It’s important to say that it’s not just a case of handing over the keys to the local authorities.  In most cases, significant investment is required to complete the properties and carry out estate-wide works.  In this way, the beneficiaries of NAMA social housing extend beyond the new residents of the properties.   For existing residents, empty houses become inhabited and outstanding works are completed.


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## rayn (10 Jul 2014)

Could it be because people need to be on the council's housing list to qualify for rent allowance. Some local authorities in the past have built social housing and found it difficult to rent them. People in private rented accommodation who are on the housing list and in receipt of rent allowance may be better off not availing of social housing.


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## RainyDay (10 Jul 2014)

I'm pretty sure that all local authorities have long queues of people waiting for housing. It is true that some people on rent allowance may well prefer to stay in their current location rather than move to some social housing locations.

But most of the newer social housing units are integrated within mainstream developments rather than segregated estates. 

I understand that some local authorities have a problem with the quality of the units offered by NAMA for social housing. They don't meet the most basic standards of fireproofing, insulation, soundproofing and accessibility.

I'm also fairly uncomfortable with NAMA turning into a large development operation. Surely it should be selling off the sites and letting private developers get on with the business of development.


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## 44brendan (10 Jul 2014)

> I'm also fairly uncomfortable with NAMA turning into a large development operation. Surely it should be selling off the sites and letting private developers get on with the business of development.


This is a fair comment. However there are a large number of impediments to such a proposal. Private developers have been largely wiped out in the past 7/8 years. Those that remain have no funds and extremely limited access to finance. Positively NAMA are looking at some joined up thinking to both maximise the return from their remaining well located development sites and provide a reasonable level of housing to meet the increasing demand. There is scope for NAMA to agree partnership deals with developers where the Agency can provide the sites/funding and the developers build out the units on a shared profit basis. I acknowledge that this may not be a s simple as it sounds but it does have some merit and would accelerate the process of developing out sites with good sales potential. I am regularly driving past a number of well placed development sites with footings already in place which if completed would quickly attract buyers.


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