http://www.irishtimes.com/newspaper/ire ... 51285.html
The facade began to crack last July with news of a €20 million Aer Lingus share loss
LIAM CARROLL’s development work is virtually at a standstill. Once the principal engine of urban renewal in Dublin, churning out shoebox apartments all over the inner city, as well as Ireland’s most unlikely corporate raider, bagging control of Dunloe Ewart and substantial shareholdings in Greencore and Irish Continental Group, Carroll is now virtually idle.
The first sign of a crack in Carroll’s armour was the revelation last July that he had lost an estimated € 20 million on the sale of shares in Aer Lingus. He had started building a stake in the airline just six months earlier, using contracts for difference (CFDs). But when the share value fell, he decided to “crystallise his losses” by getting out fast.
He has also racked up paper losses of at least € 75 million on his stakes in several publicly quoted companies. And the long-term viability of Zelderbridge, his unlimited holding company, is “dependent on the continued support from group companies and their bankers”, according to a note attached by auditors to its 2007 accounts.
Carroll’s titanic struggle to wrest control of Dunloe Ewart in 2002 from wily solicitor-developer Noel Smyth also came back to haunt him in November 2007, when the High Court agreed to include him as a defendant in a complex case involving The Square shopping centre in Tallaght – at the instigation of Redfern Ltd, one of Smyth’s vehicles.
Redfern, which had paid € 320 million for Quinlan Private’s stake in the shopping centre in July 2006, claimed that it had lost up to € 70 million worth of tax incentives because of continuing delays in plans to redevelop and extend The Square due to an unresolved legal dispute with the owners of Lowe Taverns over title to the centre’s car park.
Liam Carroll had become big in Tallaght, with major developments in the town centre zone. These included not just one but two hotels – the 48-bedroom Glashaus, which opened in September 2007, and the 186-bedroom Tallaght Cross Hotel, which opened in February 2008. Last January, they both closed down, with the loss of 72 jobs.
The hotels’ websites forwarded inquiries to another of Carroll’s projects, the Alliance at the Gasworks, near Ringsend, which now offers short-term apartment accommodation in a converted Victorian gasholder. The 210 apartments, first launched in mid-2006 at prices ranging from € 675,000 to just over € 1 million, had failed to sell.
Carroll ran into strong opposition from local residents – mostly owner-occupiers in the Gasworks – to his plans to turn the Alliance building into a huge 520-bedroom hotel, in competition with the D4 Hotels run by rival developer Seán Dunne. Despite being approved by Dublin City Council planners, the scheme was withdrawn in January.
Two months earlier, residents had scored a major victory over the developer by persuading An Bord Pleanála to reject his plans for a major extension of Google’s headquarters on the Gasworks site. The board ruled that the scale and mass of the extra 5,600sq metres of office space was “unacceptable” in relation to nearby housing.
Danninger, Carroll’s principal vehicle and successor to Zoe Developments, was also refused permission by the appeals board for a plan to demolish a block of flats he had built 10 years earlier on Watling Street, near the Guinness brewery, to replace it with an office block. The board ruled that it would be “visually intrusive”.
And last December, just before Christmas, Dublin City Council rejected Danninger’s plans for a huge office development up to 17 storeys high in East Wall because of its “poor architectural quality, insufficient urban design and strategic rationale” as well as its “negative visual impact”. The scheme was to contain more than 82,000sq metres of offices.
But Carroll’s biggest setback was a High Court judgment last October quashing a fast-track planning permission from the Dublin Docklands Development Authority (DDDA) for a € 200 million office development on the former Brooks Thomas site at North Wall Quay. The case was taken by Seán Dunne on the basis that the permission was discriminatory.
Carroll had lined up Anglo Irish Bank to take the first block as its new headquarters and had won a contest with Treasury Holdings to secure AIB Capital Markets for the second block – until it got cold feet. But the effect of the High Court judgment was to turn the concrete structure on the site into an “unauthorised development”, in planning terms.
The only way of salvaging the situation was to apply to the city council for permission to retain it, which was duly granted in January – with the DDDA’s support – against the backdrop of Seán Dunne seeking a High Court order to have the building demolished. The council’s decision is now being appealed by Dunne and Treasury Holdings.
Even if An Bord Pleanála endorsed retention of the partially built office block, it now seems unlikely that Anglo Irish Bank will need a new headquarters at this stage.
Carroll is also in danger of losing Marks Spencer as anchor for his Glashaus scheme in Tallaght; disappointed by the “footfall”, it has initiated court action to get out of its lease.
A € 60 million land-swap deal in 2006 under which Danninger would have acquired Dalymount Park in Phibsboro, in return for providing Bohemians with a new stadium at Harristown, near Dublin airport, is also in danger of collapsing because the football club lost a High Court case over the ownership of a small portion of the Phibsboro site.
Last October, Danninger settled an outstanding debt of € 140,000 with John Whyte Art Photography, which had taken the unusual step of petitioning the High Court to have Carroll’s company wound up over its failure to pay the bill which, it is understood, was for supplying a collection of fine art photographs for his two hotels in Tallaght.
The following month, Carroll had to halt construction of the massive Parkway Valley shopping centre in Limerick after failing to secure anchor tenants. However, he was reported to have hopes of rescuing this € 150 million scheme despite the downturn in consumer spending and the proliferation of new retail developments around the city. Also worth noting he has let nearly all of his staff go from an estimated high of 900 to about 60 left done in dribs and drabs so no official announcement