Pearse Doherty
Question:76. Deputy Pearse Doherty asked the Minister for Finance the number of businesses in arrears on their commercial leases to companies in which the National Asset Management Agency has an interest. [3210/15]
View answerThursday, 22 January 2015
Questions (76, 77)
Pearse Doherty
Question:77. Deputy Pearse Doherty asked the Minister for Finance the total value of arrears on commercial leases to companies in which the National Asset Management Agency has an interest. [3211/15]
View answerWritten answers
I propose to take Questions Nos. 76 and 77 together.
As the Deputy is aware NAMA has acquired loans from the five participating institutions and is not the owner/operator of properties. The Agency's role is that of a secured lender. Other than properties that have been enforced, all of which are listed on NAMA's website and which are managed by the appointed receivers/administrators, properties continue to be managed by their existing owners or their professional managers/agents albeit NAMA takes a very close interest in their efficient management and sale with a view to maximum loan repayment in order to protect the position of taxpayers.
NAMA's primary concern is that properties securing its loans are professionally managed at the most economical cost to ensure that rental and occupancy is optimised towards the servicing of interest and capital repayment on related loans. The owners/professional managers are responsible for the efficient running of properties, which includes the collection of rents and service charges, arrangements for letting of vacant units and the operation of rent reviews in accordance with the leases into which tenants have entered. As lender and holder of security on the asset, NAMA's approval is needed for key decisions such as significant new leases, rental reductions or abatements and plans for ultimate sale of the property. The Deputy will be aware that, following the acquisition of loans in 2010 and 2011, NAMA introduced a significant change on the previous practice of the banks in ensuring that it had full visibility over rental income and that it was appropriately captured. As a result of that policy, NAMA has to date generated €5bn in non-disposal income, mainly rental income from properties held by its debtors and receivers.
NAMA advises that across its entire Irish portfolio of secured assets aggregate arrears on commercial leases, including rent arrears, outstanding service charges and other unpaid charges, are of the order of €18m relating to approximately 100 individual tenancies. NAMA is working with its debtors and receivers to ensure that arrears are addressed. It is NAMA policy and practice that all income generated by assets securing the Agency's loans is captured and applied towards repaying a debtor's indebtedness to NAMA.
As the Deputy is aware, in December 2011 NAMA introduced a rent abatement initiative to help small and medium businesses in the retail sector which were experiencing difficulties meeting their contractual rent obligations as a result of the economic downturn. Under that initiative, NAMA has received 370 applications for rent abatements through its debtors and receivers. Of these, 339 have been approved and a further 19 are currently being assessed. The aggregate annual value of approved rent abatements is €23m. NAMA has also approved long-term rent reliefs worth in excess of €40m to small and medium sized retailers around the country.