Frank McDonald and Kathy Sheridan – The Builders

Frank McDonald and Kathy Sheridan – The Builders

Penguin – 2008 – 284 pages

Over the years, Frank McDonald and Kathy Sheridan wrote for the Irish Times a series of well documented articles telling the stories of these men who contributed the most to the property boom in Ireland and ultimately to the Irish prosperity. They enlarged their investigation into a book describing the astonishing transformation that occurred in Ireland over a small number of years in which construction played a key role.

The authors followed the personal story of the main developers, which names were written on many walls (e.g. McNamara) or carefully hidden behind companies. Most of them came from the country, with modest background and little money. They started occasionally, got lucky and rode the construction boom. This was a risky business by the amounts involved, but the market never seemed to have enough and banks kept a blind eye, lending without scrutiny during this golden age.

In the early times, flat were no more than shoeboxes, building had poor design. However latter on international architects were brought into major projects but more with the idea of winning the favour of the authorities than to implement an innovative architecture. Things did not go so easily for Developers, they had to spend also a lot of energy in lobbying local politicians and government members. Locally, developers were looking for adequate rezoning once a bank land had been assembled. At government level they pleaded for structural decisions like tax relief or stamp duty reform.

On the other hand cityscapes were well protected by An Bord Pleanala despite the ever growing pressure for higher buildings, every second project would pretend achieving a so called landmark tower. Adding ever more storeys became the easy solution to face land prices rocketing to the sky. On this matter Developers have not been very successful. Local associations played also a vital role in defending the city and globally the traditional street alignment has been firmly defended and respected.

It is remarkable that very quickly new Irish tycoons looked abroad in search of diversification. Toward UK and London firstly, where Irish investors purchased London City Airport, large parts of Canary Warf and even the Conservative Party Headquarter. They did not stop there, they also invested massively in Eastern Europe, in United States and in Asia. This might be a key factor in their immediate survival as the Irish real estate market seems to be stuck with overpriced empty properties that buyers cannot afford or are not willing to pay this level, expecting that prices may have to come down.

No need to say that this is having a bad effect on public finances. By 2006, construction accounted for 13% of Irish GNP and stamp duty - tax payable on the transfer of property – and other property related taxes accounted for about 20% of the total government tax revenues. For sure, the tax burden will have to shift to other sources.