The UK arm of the business operated by Irish builder Gerry Gannon – whose Irish loans are being managed by Nama – returned to profit in 2012 after securing debt write-offs and the transfer of bank loans.

Gannon Homes (UK) Ltd recorded a profit of £6.875 million (€8.3 million) after assigning the company’s bank loans and overdrafts totalling £24.9 million to third-party investors and writing off £1 million owed by the firm to Irish-based Gannon Homes Ltd.

At the start of 2012 the firm was sitting on accumulated losses of £10.8 million and this was reduced to £3.98 million by year end. Auditors for the firm, Copsey Murray, state in their report: “The company has significant debt associated with the acquisition and development of property assets which was assigned to third party investors during 2012.”

UK property downturn
The auditors add: "The value of these assets was adversely affected by the downturn in the UK property sector in 2008/09. More recently, the company has sold a significant amount of the developed stock at values significantly in excess of its carrying value.

“Nonetheless, it is unlikely that the accumulated losses can be wiped out . . . The company is likely to continue to rely on the support of its third party investors to continue as a going concern.”

Referring to the firm’s debts now taken on by third party investors, a note attached to the accounts states: “Bank loans and overdrafts were previously secured by a debenture over lands, development work in progress and other assets owned by the company – and were supported by a personal guarantee and indemnity from Mr G Gannon.”