Current status on the Remediation of New Priory (formerly Priory Hall)

Implementation of the Priory Hall Resolution Agreement is far advanced with the first Phase of refurbishment now completed.

The Framework Agreement, which was agreed by Government in October 2013, recognises the unique and exceptional circumstances which arose in Priory Hall and the difficulties which home owners faced following the evacuation of the complex in 2011. It is based on principles agreed by all parties to the Agreement including the Priory Hall residents, members of the Irish Banking Federation, Dublin City Council and officials from relevant Departments.  

The Agreement includes the following:

  • The City Council would oversee the refurbishment of the Priory Hall complex, with support from the Government, to make it a desirable, high quality and safety assured residential location;
  • Crucially, a commitment was made that the remediated complex would retain the same balance of private, social and other forms of housing to sustain it as a vibrant and inclusive community;
  • The banks agreed to a moratorium on the mortgages of Buy-to-Let owners whose units would be remediated at no cost to the landlord and returned to them when ready for occupation;
  • Owner-Occupier residents would transfer ownership of their units to the City Council, and these would be remediated and sold. The IBRC units purchased by the State from NAMA would also be remediated and sold to offset the cost.

Phase One includes Blocks 1 – 7, comprising of 60 residential units and 1 retail unit. Of these, the Council and St. Michael’s House will be allocated 9 units while 7 will be returned to the Buy-to-Lets, completely refitted with white goods and in turn-key condition. The remaining 44 units will be made available for sale to the Owner-Occupier market for much needed accommodation in a sought-after area.

Tenders for the remediation of Phase Two (Blocks 8-20) will issue within the next few weeks and construction is due to start end of 2016/early 2017.

In line with the Framework Agreement and having regard to the completion of Phase One remediation works, a report is being put before the Elected Members at the full City Council meeting next Monday (5thSeptember), to arrange for the sale of properties in Phase One.

The report seeks the approval of the Elected Members to:

  • Dispose of the common areas to the management company for a nominal  consideration;
  • Dispose to various named parties of the individual units.

The full details of all disposals will be presented for approval to the City Council in due course but agreement in principle is sought at this point as the sales campaign needs to be launched and the consent of the City Council is required prior to the completion of the sale of the units under Section 183 of the Local Government Act 2001.

Ends.

Notes to the Editor

  • Final Agreed Framework Approach to Resolution of Priory Hall Complex

Recognising the unique and exceptional circumstances which have arisen in Priory Hall, this Framework is based on the following principles:

  • the Government, Dublin City Council, the relevant members of the Irish Banking Federation and other stakeholders will work together to secure the successful resolution of the Priory Hall issue
  • recognising the exceptional and unique difficulties faced by the home owners in Priory Hall over the last two years, a fair and reasonable solution to their housing needs will be identified as part of this resolution process
  • solutions will be devised on a case-by-case basis in accordance with this Framework, taking account of the differing circumstances of each owner occupier in Priory Hall
  • an appropriate arrangement will also be put place to recognise the difficulties facing owners of Buy-to-Let properties in Priory Hall
  • the cost burden for resolution of the Priory Hall issue will be shared between the State, Dublin City Council, relevant members of the Irish Banking Federation and other stakeholders as appropriate
  • this Framework has no legal status but recognises the unique and exceptional situation that has arisen in Priory Hall;  an oversight process is being put in place to ensure implementation of the Framework

Resolution Process

The resolution process will incorporate the following steps:

  1. Dublin City Council will fund and oversee the refurbishment of the Priory Hall complex with support from the Government;  this will make the complex a desirable, high quality, safety assured residential location
  2. the refurbished complex will, as with the original development, involve a combination of private, social and other forms of housing;  the target timeline for completion of works, which will be immediately initiated on foot of this agreement, is two years
  3. ownership of owner occupier homes in Priory Hall will be transferred to Dublin City Council, as well as obligations to repay the loan to the lender under the mortgage;  this liability will be limited only to repayment of an amount to the lender equivalent to the realised value secured by DCC on the sale of the apartment following refurbishment, to a maximum of the mortgage outstanding at time of transfer
  4. the credit rating of the owner occupiers of Priory Hall apartments, in respect of the mortgage loans on those properties, will be restored to the position it would have been in prior to evacuation of the complex
  5. owner occupiers of Priory Hall apartments will have a twelve month period in which to complete purchase of a home
  6. the Government will ask NAMA to co-operate in identifying and making available, on a commercial basis, properties which might meet the needs of owner occupiers
  7. without prejudice to ongoing legal cases, Dublin City Council will continue to provide rented accommodation to owner occupiers for the twelve month period (or shorter period if a housing solution has been delivered beforehand);  if an owner occupier opts to retain ownership, rented accommodation will be provided until refurbishment has been completed
  8. the owner occupiers will be offered a new mortgage for a property by the same bank[1] provided it is affordable relative to their current and expected future income
  9. where necessary, on a case-by-case basis, and subject to affordability, up to 100% mortgages will be provided
  10. the banks will put a designated senior liaison official in place to deal with Priory Hall owner occupiers and will ensure that decisions on mortgage applications from owners can be referred to appropriate senior level in the their bank if necessary
  11. the oversight process for implementation of this framework will provide a mechanism to ensure that the process is fair in delivering mortgages for owner occupiers which are affordable  while meeting their housing needs
  12. rights under outstanding legal claims against developers and other parties which have been initiated will be transferred to Dublin City Council
  13. Dublin City Council will identify solutions, on a case-by-case basis for those with Shared Ownership mortgages
  14. the banks will make a contribution (subject to a pre-agreed cap) to the legal fees of owner occupiers in Priory Hall arising from the transactions to deliver these solutions
  15. those owner occupiers not capable of sustaining a newly originated mortgage sufficient to service their housing need, or who had no mortgage, will be offered a solution by the State drawing on the mortgage-to-rent  model which will provide them with suitable homes leased on their behalf ;  this solution will be identified on a case-by-case basis through the process to implement this Framework
  16. a survey will be undertaken to confirm the fire and structural soundness of each property being provided to former owner-occupiers
  17. owners of Buy-to-Let (BTL) properties will be given the option of a moratorium on the mortgage for the duration of the refurbishment of Priory Hall, with repayments to re-commence when refurbishment of Priory Hall has been completed;  BTL mortgage accounts will be credited any interest paid or accrued since evacuation of the Priory Hall
  18. the credit rating of owners of BTL properties, in respect of the mortgage loans on those properties, will be restored to the position it would have been in prior to evacuation of the complex
  19. owners of all properties in Priory Hall will provide any necessary consents to facilitate the refurbishment of the Priory Hall by Dublin City Council
  20. the oversight process being established will include specific provision for a formal review of progress after 12 months, in full consultation with Buy-to-Let owners

We would like to commend all parties for their engagement in this difficult process of resolution for the Priory Hall issue, in resolving a unique and exceptional situation which was not of their making.

2.     Report to Members on the Redevelopment of New Priory (Formerly Priory Hall)

To the Lord Mayor and                                                                     Report No. 244 /2016

 

Members of the Dublin City Council                        Report of the Assistant Chief Executive

Following protracted High Court proceedings in relation to Priory Hall, the Department of the Taoiseach, Department of Finance and the Department of the Environment, Community and Local Government representing the Government sought to resolve issues with all interested parties – the former  residents, “buy-to-let” owners, banks and this Council.  The consequences of the agreement reached between all parties following refurbishment of the development is –

  • The number of social housing units in the development will be retained.
  • The owner occupiers’ units will be sold by the Council.
  • The “buy to let” owners will retain their units.
  • The units previously owned by the developer will be sold.

A new management company for the development has been set up and a tender process was undertaken for a management agent and a sales agent.  It is intended to launch a sales campaign at the end of September 2016. The sale price of each apartment/duplex will be determined at this time.

Approval in principle is now being sought to the following –

  • Disposal of the common areas to the management company for a nominal consideration.
  • Disposal to various named parties of the individual units.

The full details of all disposals will be presented for approval directly to the City Council in due course but agreement in principle is sought at this point as the sales campaign needs to be launched and the consent of the City Council is required prior to the completion of the sale of the units under Section 183 of the Local Government Act 2001.

Jim Keogan

Assistant Chief Executive

Dated this 25th day of August 2016.

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