NAMA set to pay developers

C

canicemcavoy

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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.
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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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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.
 
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?
 
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.
 
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.
 
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.
 
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.
 
Ah, but what's a "fair price". I imagine that billionaire developers have a different concept of that to me or you.
 
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.
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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.
 
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.
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But, if these loans were still with the banks, the banks would not be paying for the project management.
 
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.
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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.
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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.
 
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.
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Thats what I am not clear about, where did you get that information? So its a loan they are getting?
 
aristotle said:
Thats what I am not clear about, where did you get that information? So its a loan they are getting?
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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.
 
I am open to correction but I thought it was just working capital loans that NAMA were advancing
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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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elcato said:
I would say you are correct but what sells newspapers is sensational statements like the OP posted at the start.
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"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?
 
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?
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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.
 
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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