‘Banks must lend to building sector’

The Construction Industry Federation has called on the banks to start lending to the sector in a bid to stimulate activity in commercial construction.

The call comes less than a week after IDA Ireland raised concerns over a future lack of available office space in central Dublin, saying it has held talks with Nama regarding the possibility of freeing up more large-scale office space to meet growing demand from foreign firms.

Tom Parlon, director general of the federation, said something needs to be done about solving the supply side immediately.

“Dublin is the prime location for investment and if the IDA continues on their recent successes it is likely that we will soon run out of this type of accommodation very soon. Buildings of this type take at least 18 months to be constructed, probably longer for major projects.

“So if we don’t address this issue soon then it could be too late to meet the needs of other multinational companies looking to locate in Dublin,” Mr Parlon said.

Last week, IDA Ireland reported its best annual job creation numbers in a decade — 6,000 net positions added during 2011 — and forecast a similarly strong year for 2012.

Mr Parlon said: “We have many different civil construction members who would love to build developments of this nature in Dublin. The problem is they can’t get loans from the banks. There is just no money being made available for projects of this nature.

“Obviously a large office project would create hundreds, if not thousands, of jobs as well, taking many construction workers off the dole and allowing them to earn wages that will contribute salaries to the exchequer.

“So investment of this kind would not only help attract more multinationals to the country, it would also provide a boost to the State coffers during the construction period. We have been repeatedly asking the banks to make finance available for these type of projects. So far we have not seen any movement on their part.”