Ireland Calling by John Spain
Dublin's Priory Hall shows the human cost of the Irish property bust
Posted on Wednesday, September 11, 2013 at 09:39 AM
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|Hundreds of people took part in a protest march outside of Priory Hall in Dublin last year.|
The worst example of the building boom in Ireland, Priory Hall, is a Dublin apartment complex that encapsulates everything that was wrong with the Irish property boom.
It made headlines in the past couple of weeks because of the suicide of one man who had bought an apartment there. Last week that forced Taoiseach (Prime Minister) Enda Kenny, after a disgraceful two year delay, to finally say something about a situation that has become a national scandal.
But before we get to the hypocrisy of Kenny, let us first take a look back at why this apartment development in Dublin has come to be regarded as emblematic of everything that was phony and rotten in the boom here.
The apartment complex was built on the north side of Dublin in an area called Donaghmede, a sprawling working class suburb of small houses where a lot of good people live, but which also has high unemployment and anti-social problems, including drugs.
During the boom, however, even poorer areas like Donaghmede were seen as suitable places for extravagant development, partly because there were vacant sites. In the adjoining Darndale area, which has a worse reputation than Donaghmede, they even built the Dublin Airport Hilton Hotel. (It's actually at a main roadway junction several miles from the airport, and Dubliners refer to it derisively as "the Darndale Hilton.")
There is also another huge housing development called Belmayne nearby which became famous because it was launched by former English Premier League soccer player Jamie Redknapp, and because of the raunchy advertising on giant billboards around the site promising a lifestyle of sex and sophistication if you bought a home inside. Half of Belmayne is now a ghost estate, and the developer is bust.
Not far from the Hilton and Belmayne, a complex of 189 apartments called Priory Hall was built by a developer called Tom McFeely, who happens to be a former IRA man and hunger striker. We need not make too much out of his IRA past, although it's certainly interesting that someone who claims to have fought on behalf of the people of Ireland went on to behave as he did towards them.
But McFeely is far from the only developer in Ireland whose work was shoddy and who took shortcuts, although he is certainly one of the worst.
The complex was finished in 2007 and went on sale in two phases at the height of the boom. The unfashionable location did not affect the prices, with the apartments costing from €250,000 upwards.
Despite the prices, the apartments were cheaper than on the Southside of the city and were just within reach of a lot of young couples desperate to get on the property ladder.
Yes, they were in a poorer area on the Northside, but they were beside a main road into the city center. So they sold well (those were the days of 100 percent mortgages) and even the City Council bought 26 of the apartments for social housing.
But there were problems almost straight away. The new residents soon began to notice that beneath the paint the finish was poor, with cracks appearing in ceilings and floors, damp walls, draughty windows and doors, poor sound insulation, scrappy balconies and a basement carpark that flooded. Getting the developer to come back and fix things proved to be impossible.
And then problems began to emerge that went far beyond comfort or decorative issues. The big problem was the discovery that the developer had failed to follow the fire regulations and the whole place was a fire hazard. This was so serious that the City Council moved its tenants out of the 26 apartments it owned in 2009.
McFeely was ordered to carry out repairs and upgrades to the privately owned apartments as a matter of urgency to fix the problems and in particular the fire risk. But by then, as we know, the boom was over and
McFeely had financial problems and said he could not afford to do the work estimated to cost over €7 million.
In 2011, having failed repeatedly to get him to adequately correct the problems in the buildings, the courts ordered that the Priory Hall complex be evacuated and the residents moved to temporary accommodation while the matter was resolved. The judge in the case was so worried that he ordered that a fire engine be on standby at the complex until the 250-plus residents had all left the buildings.
That was two years ago. McFeely is now bankrupt and Priory Hall is a derelict site.
But all the people who bought apartments there have been paying their mortgages ever since (forced to do so by the banks) for homes they cannot live in. Instead they are still in "temporary accommodation," most of it paid for by the council, although some former residents are paying rent themselves because they moved to more suitable accommodation.
The council is now challenging in court the ruling that it must go on providing free accommodation which is costing a lot of money it does not have.
For those caught in this situation it is an unbelievable nightmare which has got even more complicated over the past two years as official Ireland has dodged its responsibility because of the costs involved, and various court actions against McFeely have failed to produce any solution.
The developer has no money, or at least no money anyone can get at. And all the branches of official Ireland involved have been passing the unwanted parcel. This includes the state at national level and Dublin City Council at local level, as well as insurers and other bodies.
On paper we have a very high standard of building regulations, laid down at state and local levels. But it's only on paper.
During the boom there was very poor enforcement of the standards, with less than 10 percent of new builds being inspected by officials in a systematic manner with regular site visits.
Council officials were so stretched they could not keep up. If they visited at all they had to take the builder's word that behind completed walls, the invisible wiring, plumbing, insulation and fire stops had followed the rules.
In the case of Priory Hall we now know that was not the case. The construction and finishing were both unbelievable shoddy -- even dangerous -- as the developer cut corners to maximize profits.
The irony is that throughout the boom the state and local councils raked in money from developers with all kinds of taxes and local charges that the builder had to pay before work could start. This was meant to be spent by councils on infrastructure (roads, pathways, sewage, etc.) and on funding the proper regulation of all building works by officials.
But as we know both the state and local councils spent a lot of the money on other things, and we are now left with shoddy developments and ghost estates and no money to fix them.
Where Priory Hall was concerned everyone ran for cover. The developer said he was bust, the council blamed the developer, the state claimed it could do nothing until court actions were concluded, the insurance companies -- including the Homebond guarantee backed by the construction industry -- found reasons why it was not liable to pay up ... and the government did nothing.
Meanwhile, the lives of the unfortunate people who had bought homes in Priory Hall were destroyed as they struggled to survive and were harassed by the banks to go on paying their mortgages.
For one man, Fiachra Daly, a father of two who had been one of the leaders of the Priory Hall residents in their fight to get something done, it all became too much in July.
More demands from the banks that he and his partner Stephanie Meehan keep up payments on their Priory Hall apartment and the failure of the state to intervene finally pushed him over the edge and he committed suicide. Stephanie went public with the case and with a letter she had sent to Kenny, emphasizing that he had been a great father and a stable person but had been driven to despair by the impossible situation they were in.
Public anger and disgust at what had happened was palpable, so much so that Kenny made a statement on television on the matter last week. Doing his Mr. Sincere number, he wagged his finger at the camera and said it was an example of the worst excess of the Celtic Tiger and he insisted that he was going to do something soon ... he just needed a report for himself on the matter and a little time to consider.
It was breathtaking. Kenny and the rest of his government have known all about Priory Hall for at least two or three years.
They don't need any reports. And the court case over who will have to pay for the ongoing temporary accommodation does not stop them from acting either.
The fact is that the state was as responsible for what went wrong during the largely unregulated building boom as much as individual rogue developers like Tom McFeely. The state should pay up.
The big unknown in all this, of course, is how many more Priory Halls there are out there, and that is what official Ireland is afraid of.
In the past week there was further evidence of how little anyone cares when it was revealed that the bank that provided the mortgage to Fiachra and Stephanie had sent another payment demand letter in recent days even though he had committed suicide in July. That has since been withdrawn and the remaining debt written off in what the bank called a "tragic" case.
But most people think that only happened because it made front page news. Meanwhile, Stephanie and her two kids remain in temporary accommodation and their future is uncertain.
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