US investment fund Cerberus is to buy the massive Project Arrow portfolio from the National Assets Management Agency (Nama).
While the price has not been revealed, although Nama stated weeks ago that it had a reserve value in the region of €1bn - one fifth of what was originally borrowed by developers, investors and speculators.
Only 2.5% of the loans are said to be performing.
Mick Wallace, the Independent TD and former builder - who raised allegations about the Project Eagle, branded the decision to sell to Cerberus as "disgraceful" and "a bad deal for Irish taxpayers".
Government must stop NAMA selling Project Arrow to Cerberus - A bad deal for the Irish People... https://t.co/19uRc6Cnro— Mick Wallace (@wallacemick) October 23, 2015
Sinn Féin leader Gerry Adams called for the sale to be suspended.
"There is already huge public concern regarding Cerberus’s purchase of Nama's northern loan book last year," he said.
He added: "In light of all of the disclosures surrounding Project Eagle, it is unacceptable that Minister Noonan continues to protect Nama from public scrutiny while allowing further sales of Nama assets to the same firm at the centre of this controversy.
"There needs to be full transparency and accountability in relation to any further Nama transactions.
"I have called repeatedly for a Commission of Investigation into the management and operations of Nama to conduct a full and proper examination of the facts.
"In the meantime, the Government should not allow the sale of Project Arrow to Cerberus to proceed.
"The Minister for Finance Michael Noonan must intervene and suspend this sale pending a full disclosure of all the facts."
New York-based Cerberus emerged as the winner as inquiries continue into its purchase of Nama's Northern Ireland property loan portfolio, the £1.24bn Project Eagle sale from April 2014.
Part of that deal is now under criminal and parliamentary investigations, including by the UK's National Crime Agency, following allegations of fixer fees and kickbacks.
Cerberus has repeatedly denied any wrongdoing.
A spokesman for Cerberus said: ``Cerberus is pleased and excited to have reached agreement with Nama for this important portfolio.
“In the last 18 months, we have invested heavily and with confidence in Ireland. We have seen strong results and good outcomes for borrowers and investors alike because of our disciplined, patient case-by-case approach.
“We are proud to partner with Nama again and to further our participation in Ireland’s economic recovery through this mutually beneficial transaction.”
The sale of Project Arrow was launched on the open market in July this year with 17 potential bidders allowed access to confidential data on the properties - including locations, values and specifications.
Only five offered indicative bids the following month, with three making it on to the shortlist drawn up by Nama - Cerberus, a second major US investment fund Apollo and international bank Goldman Sachs.
Nama said valid bids were received from Cerberus and Apollo.
The loans were originally worth €6.25bn and include borrowings by 302 debtors secured on 1,906 assets.
"There has been a significant deterioration in the value of these assets since acquisition," Nama said.
The vast majority of the assets are in Ireland - 23% in Dublin; 67% outside Dublin; and 6% in the UK.
Almost half of the assets by value, 43%, are residential properties, and Nama said the majority are let or occupied and many are in areas where there is limited housing demand.
Nama said the Project Arrow portfolio was about 40% the size it was at the start of the year after a substantial number of assets were sold, loans refinanced, other loans linked to residential development sites were retained by the bad-bank and some property was identified as being suitable for social housing.
The deal has been secured by Promontoria Holding 176 BV, described by Nama as an affiliate of Cerberus European Investments.
While Nama does not normally disclose the exact assets linked to loans in its portfolio sales, it confirmed the Westport House estate was not part of the latest sale.
It is understood Mayo County Council is in talks with Nama to acquire those loans.
Frank Daly, Nama chairman, said: "Following extensive preparatory work and a robust, professionally managed and competitive sales process, we are satisfied that the Project Arrow loan sale is a positive outcome for taxpayers."
Mr Daly said Nama's expectations were met in the sale price.
He said it was the equivalent of the bad-bank working out loans over a three to five year period.
"On that basis, we consider that the Project Arrow loan sale has obtained the best achievable return for the State from these assets, in line with the Board's obligations under Section 10 of the Nama Act," Mr Daly said.
Brendan McDonagh, Nama chief executive, said: "The sale of Project Arrow represents another significant deleveraging and risk mitigation milestone in Nama's progress towards fulfilling its key strategic objectives.
"The cash proceeds raised from the sale will be applied towards redeeming Nama's senior debt and towards funding our planned investment programme in housing and commercial office space."
Nama said its board made the decision to sell to Cerberus based on the strong and clear recommendation of Cushman & Wakefield, the loan sale adviser appointed in February 2015.
Among the issues being examined around the NI loan portfolio sale is an investigation into £7m discovered in an off-shore account controlled by Ian Coulter, a former managing partner of Belfast-based law firm Tughans which acted as local legal advisers in the successful Cerberus bid.
It has been further claimed under parliamentary privilege that £15m was to be paid to a former adviser of Nama's in Northern Ireland and for legal teams' working behind the scenes work as bidding took place for the Project Eagle.