Kathleen Lynch (Cork North Central, Labour)
Link to this: Individually | In context

Question 9: To ask the Minister for Tourism, Culture and Sport the interaction she has had with the National Asset Management Agency or with other Departments on the impact NAMA now has on the hotel industry; if her attention has been drawn to the fact that NAMA is effectively the largest hotelier here; and if she will make a statement on the matter. [27225/10]

Mary Hanafin (Dún Laoghaire, Fianna Fail)
Link to this: Individually | In context

Tackling the over-capacity that undoubtedly exists in the hotel sector at present is complex and, ideally, requires a market led response over time. As I have said in reply to earlier Questions, 2010 is likely to be another tough year in the hotel sector, with further adjustments taking place as the market responds to excess room supply. The current position is that NAMA completed the transfer of its first tranche of loans of about €15 billion from the banks at the end of May. According to NAMA, the transfer of the second tranche of loans is set to commence shortly. Their aim is to transfer the remaining loans from the five institutions by the end of the year and no later than end February 2011.

The transfers completed so far included approximately €300 million worth of hotel backed loans. The process at this stage will be that the borrowers will provide NAMA with a business plan. This will cover all property and other loans including those to the hotel sector where appropriate. These plans will then fall to be evaluated and, if appropriate, reviewed by an independent reviewer, and negotiations with the debtors will then follow. This will allow for a proper assessment of the likely future performance of these loans. NAMA say it will take some time, including the transfer of the remaining loans before a clearer picture emerges relating to NAMA's exposure to the hotel sector.

I will be encouraging NAMA, through my colleague the Minister for Finance, to take a strategic approach to the hotel sector, to build up their own expertise in this area and to consult with sectoral interests, including the Irish Hotels Federation whom I have already met on this subject. I have not had any direct interaction with NAMA to date, but would intend to meet them in the future on behalf of the hotel sector.