The National Asset Management Agency (Nama) is paying Treasury Holdings and Paddy McKillen €8.1m in rent over 10 years for office space in Dublin.
Although Nama controls more than €2 billion of Treasury Holdings’ loans, it must still pay its landlords €810,000 a year over the next 10 years for accommodation in the Treasury Building on Grand Canal Street in Dublin.
The building is co-owned by Paddy McKillen, who has a 50% stake. McKillen is resisting the transfer of €2.1 billion of his loans to Nama.
The agency signed a 10-year contract in October 2010 for the third floor of the Treasury Building, which also houses the National Treasury Management Agency (NTMA). Rent for the first six months of the contract was waived, so Nama began paying only in April. The agency, which now controls more than €70 billion of loans, has the entire third floor of the building, about 20,000 sq ft.
Nama rented the office space directly from its landlords, without going through a tender process. The agency was keen to find space as close as possible to the NTMA.
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Property sources say space in the building typically rents for about €45 per square foot, suggesting Nama got good value.
A spokeswoman for Nama said the agency’s 10-year lease has a break clause after five years. “Nama has the option to exit in any year after the fifth year,” she said. “The decision will be based on value for money by comparison to alternative options.”
The NTMA, which has larger office space, pays €1.757m annually to Treasury Holdings and McKillen. The duo bought the former Bolands biscuit mills in the 1980s, turning it into a 130,000-sq-ft office block. It remained vacant for 18 months until 1990. The fourth floor of the building is currently available to let.
Nama has a staff of 122 and spent €7.8m on salaries in 2010. Last week it emerged most staff at the agency received a bonus last year, averaging about €7,000 each. It was also revealed that 14 people working in Nama or the NTMA are paid salaries of more than €250,000.