Northern Ireland’s Construction Sector and County Down Developments
Blend Network recently featured in an article in the Irish News titled Bank refusal-turned-referral helps developers make bumper return. This feature story looked at a case study – County Down Developments – where a small regional property developer in Northern Ireland was able to successfully access funding for his project through Blend Network after being turned down by a traditional lender. Here we bring you the extract of a very interesting conversation with Michael Carnduff, County Down Investment Director, and Albert McCann, County Down Property Developer:
According to Michael Carnduff, three months after the financial crash the whole of the building industry in Northern Ireland collapsed.
Land values plummeted – the plot bought by County Down Developments for £66k in 2017 was worth £240k with planning permission just before the crash.
According to Carnduff, Barclays were prepared to have a face-to-face conversation based on McCann and Carnduff’s personal track records but could not lend because of the funding criteria applied to their new company.
Michael Carnduff is also a land finder for the four biggest construction companies in Northern Ireland. In his experience they also struggle to find cost effective external funding for their building developments. As a result: ‘The only people building in Norther Ireland are building on their own cash and are the big multinationals. If funds were available there would be a hell of a lot more building going on in Northern Ireland. House prices are rising and sales are strong across Northern Ireland. Belfast is really strong and all the commuter towns.’
Carnduff believes the UK Government’s housing targets are, in themselves, realistic. However, there is no funding to deliver this. ‘It’s OK for the Government to turn around and say build 11,200 new homes in Northern Ireland a year. Currently only a fraction of this is being built. We must have the funding to support this, even with the relaxation of planning regs. If you can’t get the funding to build, why bother?’
The lack of funding means skills are moving away. ‘We have an incredible skill set in Northern Ireland in building trades and Local Government is pumping in £12m for apprentices. But many of those skilled workers have left to go to the mainland, Australia, etc.’