The Government has launched its new €1.25bn Land Development Agency in a bid to tackle the housing shortage.
The LDA, which promises to build 150,000 new homes over the next 20 years, has a focus on managing state land to develop new homes and regenerate under-utilised sites.
The Government said strategic land banks from a mix of public and private land will bring essential long-term stability to the housing market.
The LDA’s main focus will be on buying existing land owned by state departments and selling it to developers to ensure new homes are built quickly.
The body must deliver at least 40% of housing potential on the land, with 10% social and 30% affordable.
Today, we are announcing details of the Land Development Agency, which will build 150,000 homes over the next 20 years. This new agency is going to hit the ground running, from today. It’s one of the most significant ever State interventions in the housing market. pic.twitter.com/GD3diPaKA5— Leo Varadkar (@LeoVaradkar) September 13, 2018
To ensure space and funding is available, the agency will be given sweeping compulsory purchase order powers and the right to use and sell state-owned land.
One of the sites understood to be targeted by the agency is the HSE-owned former St Kevin’s Hospital site in Cork City, which was the target of an arson attack in 2017.
Taoiseach Leo Varadkar said the Government is playing catch-up.
“This is not about setting up an agency for the sake of it, this is solving a real problem,” he said.
“The Land Development Agency, with capital of €1.25bn behind it, is a step-change in the Government’s involvement in the housing market.
“We know we are playing catch-up after our housing sector was destroyed.
“The Land Development Agency is a Government intervention that is 50 years overdue and which, in time, I believe, will be seen to be as significant as the decision to establish the ESB, Aer Lingus or the IDA.”
Minister for Housing Planning and Local Government Eoghan Murphy said the agency would help tackle the boom-and-bust cycle.
“The LDA will enable Government to address traditional volatility in land prices as a result of land speculation as well as delays in delivering housing.
“Establishing the LDA creates a powerful new driver of urban regeneration with the lands, skill sets and capital needed that will assure housing delivery, including the social, affordable and market housing so badly needed for our citizens.”
Critics of the new agency say the Government has badly executed what could have been a good idea.
Sinn Féin housing spokesman Eoin Ó Broin, who tabled a motion of no confidence in Mr Murphy on Tuesday, said this was not the best use of public land.
“The details of the proposed Land Development Agency emerging from Cabinet yesterday are very worrying.
“It seems the Government is going to use the new agency to bypass local authorities and to replicate the controversial Joint Venture/Land Initiative funding model.
“This model sees public land being sold to private developers and between 50% and 70% of the houses delivered on the site then sold at market prices.
“The Joint Venture/Land Initiative model is also incredibly slow, because each project is subject to a negotiation between the private developer and the agency before a bidder is approved.”
People Before Profit TD Richard Boyd Barrett said the LDA is a mechanism to sell public land to private developers.
“The new proposal put forward by the Government is just another vehicle for the privatisation of public lands.
“Dressed up as a new plan to deliver homes, in effect it will only serve to line the pockets of the private developers and will mean council housing is relegated to the crumbs from the rich man’s table.”
Earlier: Land for 3,000 units already secured as government announce new Land Development Agency
The Irish government has announced a new Land Development Agency (LDA) with €1.25bn of capital to utilise state lands more effectively.
This will involve a range of joint ventures with the private sector and the sale of state lands, with an additional 30% affordable housing requirement.
Land for 3,000 units has already been secured from state bodies.
LDA to use state land
The LDA is intended to open up appropriate state lands for housing development.
The government will inject €1.25bn of capital into the new agency, allowing it to transact with semi-state bodies and local authorities, and the private sector.
Land with potential for 3,000 units secutred
The announcement shows that lands with the potential for 3,000 units have already been secured from the Health Service Executive, Housing Agency and other state bodies.
These include land in Dundrum (1,500 units), Balbriggan (600) and Skerries (200).
LDA to create opportunities for builders
For the land agency, building out sites will require partners with experience.
The listed homebuilders are therefore likely to see opportunities to partner with the agency.
Glenveagh Living was established in order to take advantage of such opportunities and is likely to benefit from an increase in partnership and joint venture activity from semi-state and government sources.
Today's announcement demonstrates that partnership deals could add meaningfully to Glenveagh's activity and returns in the medium to long-term.