THE HEAD OF the Construction Federation of Ireland has said vexatious objectors to planning applications are holding up the construction of new homes.
Speaking to TheJournal.ie, Tom Parlon said “it happens quite a lot” and can delay the process by another eight or ten months.
“The objection may have no basis or status at all,” he said. “And this is absolute fact, it is known and quite common where the developer has to weigh up his chances and say: ‘Can I afford to wait six months? Is my planning permission going to run out? Am I going to have to lay off some of the guys?’.”
He said the developers will contact the objectors to ask about their particular worries.
There’s a bit of toing and froing and he says ‘Look, if I was to give to €10,000 – would that ease your worries?’. The guy says maybe it would and there is a transaction and the objection is withdrawn. That is a regular occurrence. Objectors use that, they know the gun is to the head.
Parlon said this is happening across the board in the construction industry, with housing developments and with industry projects.
“We had that outrageous situation where the Apple data centre was literally gone because of objectors. Some were local and some were way out of the county.”
He said the length of time the planning process takes in general is causing serious delays for many projects and developers are frustrated with the rationale behind some of the decisions that are being made.
Johnny Ronan, who is a well known international developer planned a massive investment on Tara Street. He got in some of the best architects and design people in the world, had all the pre-planning, looked at all the national plans, talked about the height, talked about everything. Everything looked positive, he spent an absolute fortune on the whole application – and the detail of it, there was reams of stuff. He sent it in and it got rejected. There was an application for student accommodation out in UCD turned down lately, almost unbelievably so.
Frustrated
Delays in planning are not the only barriers to house-building, however, Parlon said. While there is guaranteed profit in building hotels and student accommodation, the same cannot be said for residential projects.
“The challenge is first-time buyers. They need cheaper, more affordable options and unfortunately in that case it is quite expensive to build a basic house for first-time buyers.”
The cost of both materials and labour have gone up and sites are more expensive, he said.
“The government now are focusing on the State land bank – there is a massive amount of land owned by State agencies. There is a special team in the Department of Housing looking at getting their hands on that land, but they tell me they’re extremely frustrated – it’s difficult to get the State agencies to hand over their land.
“Very often they may have a pension scheme that is linked to the value of the land or they think maybe they’ll want to do something with the land in ten years.”
In the greater Dublin area, he said an individual site for a house could cost up to €100,000 – and that does not factor in development levies and building and labour costs.
The banks too are more cautious when it comes to lending developers the money to build housing estates.
“Now there is nearly no speculation,” he explained. “The bank wants you to guarantee, so if you say you want to build 100 houses, they tell you to go build ten first, do a showhouse and as soon as you have mortgage approval and deposits they’ll fund you to do the next ten. But it slows the whole thing down.”
He said he hopes the government puts pressure on local authorities to deliver on housing so that planning delays in particular can be eased.
“They’ve all been given a target so I would expect the chief executives will be kicking ass, telling their planners and engineers that they have a figure and don’t want to be exposed at the end of the year.
“In the private sector, a guy will put his reputation on the line, build the houses and hopefully sell them. There is frustration with the public sector, there is a lethargy or whatever – stuff just isn’t happening.”
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