Bertie Ahern: The Man Who Blew the Boom: Power & Money (48 page)

With the change of Government in 1997 the lobbying effort switched to Fianna Fáil. Charlie McCreevy was targeted even as the groups involved feared that they had already missed the boat. Shoppers from Carrick-on-Shannon were going to Sligo, Mullingar and even to Liffey Valley. Designation was granted to Co. Leitrim and other counties in McCreevy’s 1998 budget and, according to Farrell, the people who had lobbied for it were ready to put it to full use. ‘Some town renewal efforts didn’t work. But here there was cooperation, and in 1999 the town took off.’ The back end of the town, where the Landmark Hotel and Farrell’s offices now stand, had been the ‘backside’ of Carrick-on-Shannon, an area of swamp looking out on the river. But piles were driven down to the rock below, and developments such as the one we were sitting in were constructed. ‘It was very exciting, and there was a trickle out to other towns where it was viable.’ It is difficult for outsiders, he said, to understand the psychological effect the arrival of such places as the Landmark Hotel had on the general population—the lift it gave people just to walk into its lobby and know that this was a new, top-class hotel, and in Leitrim. The tax exemptions were ‘the most important bit of fiscal legislation for Carrick ever.’

At the end of the period for which the designation had been allotted there was still a bit of work to be done, and a six-month extension was granted. By about 2002 the work had been done, according to Farrell. ‘The main players, who got in early and did quality stuff, moved on elsewhere.’ He himself, along with a partner, built an award-winning multiplex cinema. An indoor swimming-pool was built which attracted people from miles around. New shops such as Tesco set up in the town. The streetscape was improved beyond measure.

However, the Government continued to extend the scheme. The people who had lobbied for the measure in the first place were not lobbying for these extensions, Farrell said, though obviously some parties were. The incentives began to attract ‘a lot of people who did not have experience and who didn’t build what was needed.’ His firm was involved in selling the vast bulk of what was built, but he felt that ‘from 2003 the good had gone out of it.’ Yet what was being built continued to sell, and prices continued to rise. After a few years ‘you felt like a fool if you said you thought it was going to end now.’

Some questioned who was going to live in the housing that was being built, even though people were not leaving the county like they used to, and even though there was some immigration. The
US
credit card company,
MBNA
, set up a service centre in the town employing a thousand people—something that would not have happened if the housing for its staff members had not existed. The Department of Social Welfare moved some of its administration to the town as part of the decentralisation process.

It was after 2003 that the development outside the town happened. People pushed the envelope out, to locations that were a bit iffy. Planning permission was granted, and sites were sold on to builders. Builders have different skill sets to developers. They’re not the same. Developers tend to do more research. Not all of them are builders. Some builders built in the wrong place. Meanwhile, Ireland kept forging ahead. Credit was so available and property was so in flavour. It was a kind of intoxication.

Now the town has to deal with the fact that it has all collapsed. According to Farrell, getting the people who had built the houses and the office developments to sell at radically reduced prices is not easy. ‘People can be very tied up in a scheme emotionally. For many it was an important part of their life, and it is difficult for many of them to adjust to what has happened.’

Even while believing that what occurred was a disaster Farrell retained a kind of optimism. The whole ghost-estate story had been overdone by the media, he said. The houses that were built could be put to some use, but prices needed to fall even more than the 40 to 60 per cent by which they had already dropped—likewise with the glut of hotels built because of the unwise tax incentive scheme for the sector promoted during the boom. When the price for hotels dropped low enough, he said, people would be willing to take them on and run them in a viable way. Commercial property deals in Carrick-on-Shannon sometimes involved a rent-free first year, giving new businesses an opportunity to get off the ground. If dealt with cleverly enough, what had happened could be put to good use and form a basis for increased vitality in the town.

But what will not go away is the low architectural standards and design values that were allowed. Throughout the country the whole phenomenon of tax incentives for property has formed the basis for a huge proportion of the ‘built environment’, but no effort was made to create something admirable—something that future generations would be able to value and admire. Farrell criticised the Department of the Environment for allowing tax incentives for houses that don’t have wooden doors or natural slate. Hand-made brick should be allowed outside Dublin. ‘It was a missed opportunity.’

Afterwards I went driving out the road towards Leitrim. As you come close to the village the estates begin to appear. I pulled into one called Cois Abhann, a development of sixteen detached houses, each with exposed brick and yellow plastered walls. The doors and windows are
PVC
. The four-bedroom houses, a large sign advertises, qualify for section 23 tax relief. I stopped beside one of the few houses with a car outside the door and garden furniture in the garden to the rear. The man who opened the door was renting. He said that about half the houses were empty, that some of them were shells, without proper kitchens or proper flooring. I told him what I was doing. He suggested that I visit an estate on the other side of the road, a few hundred yards closer to the village.

Tax designated
announced the large roadside sign indicating the presence of this estate.
Des Foley and Sons proudly presents Dún Carraig Céibh, an estate of three-bedroom townhouses, four-bedroom semi-detached, and four-bedroom luxury detached houses
. The development is off the main road, up a steep, curving entrance that brings you to a small roundabout, the townhouses in an arc facing you, a turn to the left leading straight into grass, the turn to the right leading into the rest of the estate. The roadway continues along the crest of the hill; there are some semi-detached houses on the right, yellow and cream, some exposed brick. The road ends at a metal and wire barrier that traverses it, beyond which there is no tarmacadam, but there are a number of large, detached houses looking down over the land and the small lake below. One of the houses is a distinctive blue. The glass in the windows still had stickers attached. Inside, you could see rolls of yellow insulation on concrete floors, interior doors lying where the workers had laid them. There was even a rusting yellow tipper. It was an on-land version of the
Mary Celeste
. Snowflakes began to fall.

A young woman who lived on the estate pointed me towards two of the houses that were owned by their occupiers, but no-one answered when I knocked. A man out for a smoke at a nearby house was happy to talk. He told me he rented from the man who built the houses, Des Foley, owner of Gerti’s pub in nearby Keshcarrigan. He thought Foley still owned most of the houses, renting out some of them. There were signs offering houses for rent, home-made signs like the ones you might see elsewhere in the countryside offering free-range eggs or strawberries for sale. I decided to head for Keshcarrigan.

To get there you have to drive back towards Carrick-on-Shannon and then take a left. The road is narrow and winding; the land to each side looks unpromisingly soggy and poor. Lakes large and small appeared and disappeared as I travelled along what at times resembled a lane more than a road. The sun had fallen below the horizon, and the sky had turned a mix of black and grey when I crossed a bridge and arrived in the village. Gerti’s was almost the first building on the left, just after some tall and weather-beaten hoardings advertising new housing. The village was a short string of houses and shops. I parked by the old stone Garda station and made my way back to the pub.

‘You ask, and I’ll tell you whatever you like,’ said Des Foley when I explained what I was doing. The pub was empty save for an elderly man watching a boxing match on a widescreen television. There was a fire burning and a friendly wooden bar, but the temperature was too low to call the room cosy. I suggested that, instead of my asking questions, he would just tell me his story, where he was from, how he came to build Dún Carraig Céibh.

He agreed. He grew up just outside the village, on a small farm of poor land, though his late parents would not have been happy to hear him say that. ‘They fought hard enough for it.’ He went to London to work in the 1960s, when he was sixteen years old. It was what young men did. One Christmas thirteen of the fifteen boys who’d been in his class in school were in London. He worked on English building sites for seven years and then came home in 1974 to help his parents, who were growing old. He worked on their thirty acres and did some plastering on the side—any construction work that came his way. After about five years he started a tool hire business with a former school friend, Noel Doherty. They worked together until 1991. Then he bought the pub.

At the time, the Shannon-Erne canal was being developed, and he decided to call the pub Gerti’s Canal Stop. One year ten television crews called to the pub, one including Jill Dando. The pub did okay, and in the meantime he was doing some construction work on the side. Not much, because there was no money. By the time the tax designation scheme arrived in 1999 he had some sites and extra farm land, and he and his son built a few one-off houses. Then, in 2001, he built a development of twelve houses in Keshcarrigan, ‘a big development then.’ The houses were priced at about €65,000 each. One or two were bought by local people, and the rest were bought by investors and people from Dublin who wanted them as holiday homes or to shelter rental income from other property they owned. (People with substantial income tax bills could reduce or erase their bills by buying housing in Co. Leitrim and other designated counties.) One house he sold for about €60,000 was resold for €149,000 about five years later. His next development, again in Keshcarrigan, had twenty-four houses and three commercial units. The units now house a hairdresser’s, a restaurant and a solicitor’s office.

‘People who were passing on the canal saw the houses, the quality, the cost, the nice location. The word spread.’ Houses that had cost €65,000 were now worth €100,000, then €150,000. The price of sites and materials went up, and the cost of labour doubled. His next scheme had thirty-six houses in it. At one time he was doing ‘two houses a week, and I had fifty lads employed. I had lots of customers. I’d say, I have a new site, and they’d say, Hold one for me.’ Some people were buying houses because their tax accountants were telling them to.

The one on the hill—Dún Carraig Céibh—was to be the last of them. He had already had enough of it, and then he heard that the Minister for Finance, Brian Cowen, was extending the scheme once more, for six months. ‘We all went mad building because of that,’ he said, though he is not trying to shirk responsibility.

We were all over twenty-one years of age, and we could have known there were too many houses being built. But, as Bertie Ahern would say, if you weren’t being positive you were being anti-Irish. The advice from everyone was ‘Go at it, yeh boy yeh.’

He wasn’t worried. He had promises from prospective customers, people he had dealt with before. They liked houses in Co. Leitrim because of their size, their quality and their price.
AIB
, his banker, said, ‘Go, go, go!’ They encouraged him to buy the site, and the money for the development was ‘there in a week.’ Foley said it was his policy to put his own money into the developments so that the bank was being asked to put up only 50 per cent.

Then, in August 2007, he noticed a change. The showhouse went on view, and people were interested, but then some said they couldn’t shift houses they were going to sell before buying his. ‘Even at that stage some people were saying it was only a year’s blip.’ He thought people in Carrick-on-Shannon might buy them, because they were up to €100,000 cheaper than similar houses there. He sold about one-third of the scheme. The rest lies empty still.

It’s not a question of what am I going to do with it. It is a question of what will the bank tell me to do with it. I’m one year trying to get an interview with the bank manager.

Foley has used his own resources to fit out and furnish some of the houses, which he has managed to rent. He would like to complete the development. ‘When you put thirty or forty years’ work into something, you like to see it completed.’

The housing bubble provided manual employment for the local men, many of whom learnt valuable trades. Now many of them have gone away, to Britain or the United States. Some are still at home but are on social welfare. Despair has returned to a region where the suicide rate has at times been among the highest in western Europe. He hears it in the pub, Foley said, people talking about it. He draws a finger across the front of his neck.

Bertie Ahern once came into the pub with a local Fianna Fáil man. ‘The two of them stood there with their mouths open. “Right,” I said, “the bar’s over here. Who’s ordering?” And they just left. They bought nothing.’