I assume that the Deputy is referring to information originally provided in reply to Parliamentary Question 220 of 21 March 2017. In that reply, information was provided on exceptions approved by NAMA, over the period 2014-2016, to its policy of open marketing of loans by NAMA and of assets by its debtors and receivers. I assume that the Deputy is now seeking corresponding information for the period from 2010 to 2013.
As the Deputy will be aware, NAMA does not own property, and its role in relation to property is as a secured lender. As a result, where properties and assets over which NAMA holds a charge are being sold, the sales process is managed by the property owner or by a receiver. NAMA does not manage the sales process, but NAMA guidelines require that a property be openly marketed, with the property owner or receiver appointing a sales agent to market the property and ensure that the sale is conducted in an open and transparent manner. As secured lender, NAMA's approval of the sale is required before its security can be released to complete the sale.
While NAMA normally requires that its debtors and receivers comply with its open marketing policy, that policy was never intended to be applied rigidly and inflexibly. NAMA is required to act in a commercial manner and open marketing does not necessarily provide the best financial return in all circumstances. For some transactions, exceptions to the open marketing policy may be required for legal or commercial reasons. In such cases, NAMA’s approval is required.
I am advised that the NAMA Board policy provides for four categories of exceptions to its policy of open marketing.
One exceptions category relates to cases where specific written advice (either legal or professional) has been obtained by NAMA recommending that open marketing should not be pursued for commercial or legal reasons. Included in this category are transactions involving defective security and transactions involving the sale of assets where there were legal impediments to open market sales. These included cases involving existing ownership agreements and third parties with legal entitlements or pre-emption rights relating to the assets. Assets are offered at the appraised market value confirmed by way of independent valuation report received by NAMA. Over the period 2010-2013, I am advised by NAMA that 27 transactions valued at €74m fell into this category.
A second exceptions category relates to cases where a government or State entity has approached NAMA to purchase an asset for legitimate reasons in the public interest. NAMA's Business Plan, which was published in July 2010, stated that NAMA would engage proactively with Government departments, local authorities, State agencies and other appropriate bodies in relation to their possible need for land/properties. This includes the sale of sites for the provision of primary and secondary schools, properties and sites sold to local authorities and to various Government departments and State agencies and sites identified by IDA Ireland as suitable for Foreign Direct Investment. Derogations are applied in instances where the purchaser is an existing tenant or where an existing business is looking to expand into an adjoining NAMA-secured property or site. Such derogations are dependent on achieving the current market value as determined by an independent valuation. Over the period 2010-2013, I am advised by NAMA that 17 transactions valued at €27m fell into this category.
A third exceptions category arises where NAMA, through NARPS, acquires assets for social housing purposes from NAMA debtors or receivers for onward leasing to Approved Housing Bodies (AHBs). NAMA, through its special purpose vehicle NARPS, purchased properties from its debtors and receivers for onward long-term leasing to local authorities or AHBs. In addition, AHBs directly purchased residential properties for social housing purposes. Such derogations are dependent on achieving the current market value as determined by independent market valuations. Over the period 2010-2013, I am advised by NAMA that 14 transactions valued at €35m fell into this category.
A fourth exceptions category relates to cases where the asset is the subject of a compulsory purchase order (CPO) by a State body or local authority. Over the period 2010-2013, I am advised by NAMA that no transactions fell into this category.