3 years on, only 3% of nearly €6 million grant spent on Guinness lands
“People Before Profit TDs highlighted the problems of funding for the LDA in the Dáil. We proposed to create an integrated publicly funded building company instead of relying on piecemeal schemes and trying to jump through hoops to keep the developments “off balance sheet”.” — Ruairí Fahy
Only €180,000 of a €5.8 million euro grant to develop infrastructure to enable construction on the Guinness Lands has been spent according to documents released to Ruairí Fahy, People Before Profit representative for Limerick. When the plan was originally announced by the Land Development Agency in 2020, it stated that 400 homes would be constructed by 2023 council-owned lands.
The funding was originally announced in 2019 by then Housing Minister, Eoghan Murphy, as part of an €84 million package under the Strategic Sites fund. The goal of the funding was to “provide key facilitating infrastructure, on public lands, to support the delivery of affordable homes to purchase or rent.” Explaining why the funding was needed Minister Murphy explained “We’ve seen recently that house prices have been cooling down, even falling in some parts of the country as supply increases. But for too many people home ownership still remains out of reach. Unless the government steps in to bridge the gap, young couples and workers may not be able to afford to buy their own home in our cities and large towns.”
At an Oireachtas committee on the implementation of “Housing For All” in November last year Director of Housing with Limerick City and County Council, Caroline Curley, stated “With regard to the Guinness site, we had been moving ahead to develop that ourselves but when the Colbert Station plan came out, we put it with that because we figured it would make a better holistic job of the whole thing.”
At a special meeting of Limerick City and County Council, Ms. Curley claimed that the plans for apartments have "slowed down" due to the need for integration with the LDA plans, but that the site should see "some units by 2026."
In an interview with Joe Nash on Live95 in April this year Head of Strategic Planning and Chief Planner at the Land Development Agency, Dearbhla Lawson, described the role of the LDA as facilitating public bodies to “optimise lands and plan them in a more integrated way” but she admitted it would be 2028 before they delivered any units in Limerick with the Class One site, the Gasworks site, at the junction of O’Curry street and the Dock Road, the most likely site to support the delivery of homes.
Limerick City and County Council CEO, Pat Daly, said in the Oireachtas committee in November “The council signed a memorandum of understanding in September 2022 with the LDA to progress the delivery of cost rental on council-owned land and other State-owned lands at Colbert Quarter, which will deliver approximately 270 homes for cost rental in the first phase.”
Clarifying what is meant by affordability in regards to cost-rental, Ms. Curley state “the issue with the notion of affordability is to do with the percentage below the market value at which one can deliver a house. The difficulty we have in Limerick is that our market values are quite low and our build costs are high, so it is hard to come in below 15% for purchase and 25% for cost rental.”
In the, heavily redacted, documents the Department of Housing and Limerick City and County Council discussed using the Shanganagh model has been suggested as a means for funding development on the Guinness Lands. Under this model the council retains ownership of the lands but enters into a long-term lease agreement with the LDA. This allows the Strategic Site Fund grant to be used on the site without breaking competition rules. As the different funding schemes were being discussed and no decision was taken an officer in the Local Government Management Agency stated in February 2022 that the LCCC, “are anxious to move with this because if they can’t progress the site, they need to move on from it”.
In a document circulated to Councillors in Dublin regarding the Shanganagh site average rents were stated to be €1,200, 40% below market rate. In the documents there were viability concerns around the project due to “hyperinflation” in construction in 2021 with QSs in the Department of Housing worrying that construction costs had increased by 8-10% between July 2021 and March 2022. This inflation also affected Shanganagh with average rental prices now around €1,400. For Limerick this would place rental costs for a cost-rental scheme at, or even slightly above current market rates.
On the revelations Ruairí Fahy said, “People Before Profit TDs highlighted the problems of funding for the LDA in the Dáil. We proposed to create an integrated publicly funded building company instead of relying on piecemeal schemes and trying to jump through hoops to keep the developments “off balance sheet”.
“The government needs to admit that the housing model they have been pushing for decades has failed. It has allowed a few speculators to make a fortune on the back of the immiseration of people in low paying or unstable jobs. We need direct build, public housing available to all, regardless of income to ensure a good quality of life for all and decent working conditions for builders.”
