Rising property prices may help councils finish estates

The upturn in the economy may help 5,000 people living in unfinished estates even more than legal threats against financial institutions which have an obligation to complete works to them.

Rising property prices may help councils finish estates

Cork County Council has signalled it will take financial institutions to court if they fail to hand over money in insurance bonds designed to finish off estates if a developer went bust.

The council’s chief planner, Andrew Hind, has said that AIB officials had since met a couple of times with council staff after their chief executive Tim Lucey threatened legal action against the bank last June.

Mr Hind said the bank had agreed to meet council officials three to four times a year to discuss and try and resolve ongoing issues.

“What is helping matters is the rising market. Financial institutions will always want to see some kind of return. It may be that there is land left over which can be sold on,” Mr Hind said.

Nine financial institutions – AIB, BoI, Ulster Bank, Allianz, Anglo/IRBC, ACC, Liberty, BoS and Euler Hermes – hold €24,269,754 of bonds on 138 unfinished estates in the county.

A report issued by the council shows Anglo/IRBC are also engaged in discussion about unfinished estates they have bonds on.

“We are trying to get an agreed plan on who pays for what,” Mr Hind said.

He said delays in getting estates finished were in part due to the council not having the powers of enforcement it should, as the system of legal safeguards in place were never intended to deal with the wholesale collapse of the building industry in 2008.

“I think nationally there are lessons to be learnt. It may be necessary to introduce legislation,” he said.

Mr Hind explained many of the bonds currently held by financial institutions were issued in 2005 and some of the legal requirements at the time “weren’t as finely tuned as you’d like.”

Cllr Deirdre Forde (FG) said she wanted to see the council get even tougher.

“I feel that all the receivers and financial institutions should have been called before us [councillors] so we could ask them what they were going to do about it. It’s been going on far too long.”

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