Property development companies show losses over €12m

A NUMBER of property development companies co-owned by well-known Limerick businessmen, Joe Hanrahan and John Shee recorded combined losses of over €12 million in 2009, new accounts show.

The two men jointly hold a majority shareholding in the country’s largest nursing home provider, Mowlam Healthcare, which is profitable.

However, returns by property companies co-owned by the two show aggregate losses of €12.8m in the 12 months to the end of December 2009.

The company to make the biggest loss was Wadlow Ltd that recorded a loss of €5.6m in 2009.

Returns for Cracken Properties show that it made a loss of €3m in 2009 with Megcourt Developments recording a €2.4m loss while Paland Developments recording a €1.7m loss in 2009.

The two were also involved in the deal to purchase the 270-acre Tinerana Estate from Dr Paschal Carmody and his wife, Dr Frieda Keane Carmody, in a multi-million euro deal in 2006.

A subsequent planning application to transform the estate into a tourism resort, comprising of an 18-hole championship golf course, a 32 bed apart-hotel, 155 two bed holiday homes and an equestrian centre tourism resort, that was to generate 400 jobs, was turned down by An Bord Pleanála.

Accounts for Wadlow Ltd show that its accumulated losses at the end of December 2009 stood at €14.9m.

The filings show that the company had creditors totalling €28.6m comprising of bank loans of €26.1m and a shareholders’ loan of €2.5m.

A note attached to the accounts states that the company’s bank facility “is outside credit terms and there is no certainty as to how long the bank will continue to provide this support as this is a matter solely for the bank”.

The note adds: “The company’s ability to generate cash flows is dependent on sustaining the rental income on the shop units and an upturn in the economic environment in which the company operates.

Auditors for Wadlow Ltd, the HDS Partnership provide a disclaimer on the company accounts, stating that they are unable to form an opinion as to whether the financial statements give a true and fair view of the company’s affairs due to the trading environment in which the company operates, the company’s banking facilities and the ability of the company to continue as a going concern.

Cracken Properties owns 7%% of Wadlow Ltd and 16.67% of Megcourt Developments Ltd.

In relation to Cracken Properties Ltd, a note states that “the future of the company is dependent on the continued support of its bankers, directors and group companies”.

The company had bank loans totalling €2.47m at the end of 2009. A note states that the company’s bank advances are secured in personal guarantees obtained by AIB, Bank of Ireland and Anglo Irish Bank.