John McGuinness (Carlow-Kilkenny, Fianna Fail)
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262. To ask the Minister for Finance if he is satisfied that the National Asset Management Agency's proposal to build and develop residential and commercial property is compliant with competition law. [35975/15]

John McGuinness (Carlow-Kilkenny, Fianna Fail)
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268. To ask the Minister for Finance the reason the National Asset Management Agency has chosen to become a developer of commercial property and not a developer of residential or social housing; and if he will make a statement on the matter. [36000/15]

John McGuinness (Carlow-Kilkenny, Fianna Fail)
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270. To ask the Minister for Finance the skills and requisite experience that are within the National Asset Management Agency to allow it to engage in property development; and if he will make a statement on the matter. [36002/15]

Michael Noonan (Limerick City, Fine Gael)
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I propose to take Questions Nos. 262, 268 and 270 together.

Firstly it must be pointed out that NAMA does not own property, and it is not a builder or a developer, nor has NAMA chosen to become one as the Deputy suggests.  NAMA's role in relation to property is, like a bank, that of a secured lender.  As set out in Section 10 of the NAMA Act, NAMA's mandate as a secured lender is to achieve the best financial return for the State from the management and sale of its acquired loans and the assets underlying those loans.   The provision of development finance to enhance the ultimate disposal value of assets securing NAMA's loans is entirely consistent with this mandate and NAMA has already advanced over €1.3 billion on a commercial basis across a range of commercial and residential development projects in Ireland since its acquisition of loans in 2010.   

Aside from the fact that NAMA is a secured lender, rather than a developer, the Deputy is also not correct in suggesting that NAMA's focus in this respect has been solely on commercial property development. Last year, NAMA funded the delivery of nearly 50% of new housing output in Dublin despite having an exposure to less than one-third of residentially zoned development land in Dublin and since the start of 2014 has funded the construction of over 2,000 new houses and apartments in the greater Dublin area. In conjunction with last week's budget, NAMA announced that having carried out a review of residential development sites under the control of its debtors and receivers, it is aiming to fund the delivery of a target 20,000 additional new homes before the end of 2020.  This is in addition to NAMA's ongoing and central role in facilitating the delivery of new commercial and residential space in the Dublin Dockland's SDZ.  

Development projects are managed by NAMA debtors, receivers or third-party partners. To achieve the 20,000 target, NAMA will, for instance, work with existing debtors, where possible, but will also work on a commercial basis with developers with no current links with NAMA in developing lands securing NAMA loans. It will seek out Joint Venture and partnership arrangements to ensure that a broad range of developers and contractors have an opportunity to contribute to the residential delivery programme. NAMA ensures in this context that all funding, in accordance with Section 10 of the NAMA Act to obtain maximum return to the State, is based on market commercial terms and that projects are commercially viable.  NAMA's role in funding projects is no different therefore to that of other commercial financial institutions and banks. The Deputy will also know that under the terms of the EU Commission's State Aid approval of the NAMA scheme in 2010, NAMA reports to the Commission and the Competition Authority each year on the use of its powers under the NAMA Act in the previous year.

To the extent that it makes commercial sense to fund the development of projects under the control of its debtors and receivers, whether commercial or residential, NAMA is well placed to do so.   From its very outset, NAMA, through the NTMA, recruited staff with a diverse range of skills and experience from disciplines including banking, finance, law, insolvency, property development, asset management, architecture, engineering, surveying, planning, and construction.  As a result NAMA has the necessary resources, skills and experience, which were not available in the banks responsible for the pre-crash lending to the property sector, to successfully fulfil both its asset recovery and asset management mandates.  I am, as a result, fully satisfied that NAMA is best placed to bring coherence, direction and drive to the development of secured assets by its debtors, receivers and third-party investment partners.   I believe that anybody who takes the time to objectively consider the work that NAMA has already done in facilitating the delivery of new housing and new office space in the greater Dublin area, including the Docklands Strategic Development Zone (SDZ), will agree with that assessment.