Demand drives almost ninefold increase in profit at Gannon Homes

Fuelled by strong demand in the broader housing market, profits after tax at Gannon Homes, the property company owned and led by well-known Celtic Tiger-era developer Gerry Gannon, increased by almost 880 per cent in 2021 to €2.1 million from €240,661 in 2020.

Amid soaring demand for housing in Ireland, revenues at Gannon Homes jumped more than 9 per cent to €55.2 million, mostly driven by the sales of developed assets, which topped €53 million in the year.

In a report attached to accounts filed with the Companies Registration Office recently, the directors of Gannon Homes said: “The activity for the year reflects the demand in house construction and sales which is a feature of the overall market performance.

“The company continues to develop stock for sale, reflecting a confidence in the underlying demand for new homes,” they said. Current directors of the company include former Fianna Fáil minister for education Batt O’Keeffe, who joined the board in 2019.

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Among other transactions, Mr Gannon’s company sold the Clonskeagh Paper Mill site in Dublin 6 to Bain Capital for more than €18 million in February 2021.

The company also made headlines last year after putting a site with full planning permission for more than 1,800 homes in Clongriffin, north Dublin, on the market for €50 million. Sean Mulryan’s Ballymore Properties reportedly paid €40 million for the 27-acre site earlier this year.

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Gannon Homes also generated close to €1.8 million in residential rental income in 2021.

The company’s loan facilities and related securities have been held by the National Asset Management Agency (Nama) since 2012 after the collapse of the Irish property market. Gannon Homes, which received fresh funding from the agency in 2020, has continued to develop properties under a connection management agreement with Nama since 2012, which expires in 2024.

The €2.1 million profit for 2021 reduced Gannon Homes’ historic liabilities to almost €104.7 million by the end of the financial year.

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In a note in the accounts, the company, which had total assets of €33.7 million last year, said the chief risk it faces is that “support or funding will not be available to complete the developments” in its pipeline.

However, it said the directors “are confident that Nama will continue to provide financial support” and they are satisfied the company can continue to manage its business and pay its liabilities.

In May, Mr Gannon announced plans to sell 532 homes for social and affordable housing for an estimated €243 million to two Dublin local authorities. The proposed sale by Gerard Gannon Properties would be the largest ever by a developer under the Government’s Part V social housing regime.

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The 532 homes earmarked for social housing arise from Mr Gannon’s firm lodging €1.15 billion plans for the largest strategic housing development fast-track scheme to be put before An Bord Pleanála. The company has lodged plans for a mixed-use scheme for 2,527 residential units for Belcamp Hall, Malahide Road in north Dublin. The proposed Part V sale is contingent on the Gannon company securing planning permission.