I thank members for the invitation to attend today’s meeting to assist them in their examination of the LDA's financial statements for 2023. As requested by the committee’s secretariat, we have furnished some information in advance.
I am chief executive of the LDA, and to assist in answering members' questions, I am joined by: Róisín Henehan, chief financial officer; Phelim O’Neill, head of property; Dearbhla Lawson, head of strategic planning; and Enda McGuane, asset management lead.
The LDA is the State’s affordable and social housing delivery body. Our purpose is to maximise the supply of affordable and social homes on public and other land in a financially sustainable manner to help address the country’s housing need. The year 2023 was strong for the agency as we continued to ramp up our housing delivery while also developing a pipeline of housing projects that will ensure an ongoing, steady and sustained annual supply of affordable and social homes. We deployed or committed almost €1 billion in the delivery of affordable homes between capital spend and commitments through our direct delivery and homebuilder partnerships. This is a significant increase from our 2022 investment and clearly demonstrates the strong upward trajectory of the agency, both in terms of output but also capacity. We expect this trajectory to continue in a manner that ensures value for money for the taxpayer.
At the end of 2023, the LDA had 5,600 homes in the planning and design phase and more than 1,000 under construction. We had planning permission for a further 1,850 and planning applications lodged for an additional 900 homes. We had also delivered over 850 homes, of which 650 were cost rental and 200 affordable for sale.
In total, the LDA has a pipeline of 37 sites for direct development, which will deliver approximately 17,000 homes. Many of these are already under construction or about to go to construction. To sustain and enhance our direct delivery pipeline, we have launched a private land acquisition initiative targeting the purchase of housing sites in the five main cities at prices that would allow for the increased delivery of affordable housing, predicated on value for money being available in the market.
Meanwhile, we have already delivered or are in the process of delivering around 2,800 homes through our homebuilder partnerships with a further 5,000 planned by 2028. These are in addition to the direct delivery pipeline of 17,000 homes. This brings the LDA’s overall housing delivery portfolio, comprising sites already built out, being delivered or in due diligence, to 59 sites across the country.
This continually increasing pipeline will be supported by the work of the Report on Relevant Public Land, completed by the LDA in 2023. This report, for the first time, provides a coherent and comprehensive understanding of the potential for housing delivery on State land based on fact rather than intuition. It advised the Government of the potential to deliver 67,000 homes on 83 State-owned sites.
Just last month, we launched phase 1 of Shanganagh Castle Estate, our first direct delivery project on State-owned land, which we developed in partnership with Dún Laoghaire-Rathdown County Council. It includes 597 homes, involving a mix of affordable purchase, cost-rental and social homes. Construction is ongoing at the former St. Kevin’s Hospital site in Cork and at Devoy Barracks in Naas. We expect to be on site at St. Teresa’s Gardens in Dublin city centre, Cromcastle and Clongriffin, also in Dublin, by year end.
Our homebuilder partnerships are part of our Project Tosaigh initiative, which involves working with homebuilders to identify housing delivery opportunities and providing the stimulus required to get projects under way and completed. As part of this initiative, we have already delivered affordable purchase homes in Cork,
Dublin, Meath and Waterford in addition to cost-rental homes in Dublin, Kildare and Wicklow. We recently concluded a public procurement process to establish a framework of homebuilder partners under Project Tosaigh phase 2, which we now intend to commence forward funding transactions to facilitate the delivery of higher density cost-rental schemes. This involves providing stage payments to homebuilders while also reducing the cost of public housing delivery. These 2,000 homes are being procured through a competitive bid process, which has driven downward pricing tension among developers.
In line with Government policy, our affordable purchase homes are made available at affordable rates through the provision of an equity share scheme overseen by the relevant local authority. This allows households to secure a brand new, A-rated home at a cost they can afford and with mortgage payments they can meet. The households involved also have the option of buying out the equity over time.
Our cost-rental homes are designed to assist people who do not qualify for social housing but who cannot afford to rent at existing market rates. Eligible candidates can secure a new home at rents that are up to 30% below market rates. The rents charged cover the cost of building and maintaining the homes, which are ultimately owned by the State. The average rent for an LDA-provided home is currently €1,350 per month while the average rent on the open market for new-to-market homes €2,395 per month in Dublin.
While there is an ongoing discussion on the affordability of affordable housing to its end users, which we welcome, I make the point that our housing developments are in high demand. There are households actively buying and already living in our affordable homes, and there are others living securely and happily in their cost-rental apartments. Each of these households has a housing need that is being met by our housing delivery.
To date, we have sold 200 affordable homes, with a further 44 homes at sale agreed. The application portal for the houses in Shanganagh Castle Estate went live yesterday and there is huge interest in them. We also rent homes to almost 1,000 households, some of whom have been renting with us for almost a year. Rental collection is strong, further supporting the affordability credentials of our homes.
The LDA was established in 2018. The LDA Act, which allows us to operate effectively and provides us with the necessary finance, was passed in 2021 and commenced in 2022. As a relatively new agency, we have sought to scale our organisational capacity and size to ensure we are well positioned to deliver on our remit. In this regard, the total number of employees grew by 60% in 2023 to 112. A further 80 roles have been created since then and there are now more than 190 staff employed or being hired by the LDA. New staff have been added to all teams, but particularly within the delivery, construction, development, strategic planning and asset management functions. These additions have continued to strengthen the LDA’s skilled and diverse talent pool.
As we have grown in size, we have placed considerable focus on fostering a culture of strong corporate governance. We constantly review our policies and procedures to ensure we operate to high corporate governance standards and that our activities are consistent with our statutory responsibilities. We continuously seek to act prudently and ethically with an emphasis on transparency, accountability and sustainability. As the committee will be aware from our financial accounts, we have already received funding commitments of €2.5 billion. Based on our strong delivery pipeline, the Government announced a further €1.25 billion in funding in budget 2025 for the LDA and has signalled its intention to raise our total capitalisation to a potential €6.25 billion, including a provision to borrow of €1.25 billion. This is a very welcome development as this level of investment will allow us to proceed with confidence and expand our delivery at scale.
To conclude, I thank the committee for the invitation to attend today and we look forward to answering any questions Members may have.
