Did Department of Education pay over the odds for Mill Road school site?

Today we publish records we obtained from the Department of Education about its purchase of the Educate Together Secondary School site at the corner of the Mill Road and Colpe Road.

The information that was released to us from the Department of Education suggests that

  • Shannon Homes was paid more than two and half times the Department’s valuation of the site with €1.88 million + VAT being paid in the end valuing the land at €170k per acre compared with the Department’s valuation of €73k per acre
  • In 2012 when it bought the Gaelscoil site the records record the Department’s view that it paid “way over market value”
  • The Department paid €1.33 million + VAT as a contribution to road works that were part of a Shannon Homes’ commercial development and which it appears it had contractually agreed to build and maintain at its own expense.
  • The Department’s property consultant reported that Shannon Homes was looking for residential value but there is no record of it pointing out that the site was not zoned for residential use.
  • The Department’s property consultant also reported in January 2020 without comment that the lands had “first class zoning” in the new county development plan, despite the plan’s adoption still being two years’ away

You can also read the coverage in the Irish Examiner

The documents released to us are lengthy and are copied below, but here are the key extracts:

Comment from Department of Education that they paid “way over market value” when they purchased the site of Gaelscoil an Bhradáin Feasa in 2012

Department notes that vendor (Shannon Homes) has “unrealistic price expectations” for Educate Together site.

Department’s property consultant tells them that Shannon Homes will look for residential valuation, no evidence of any advice that the site zoning did not support residential or why such a high valuation was justified.

Department of Education values site at €720,000 but are told that site has first class zoning in “new” county development plan, the adoption of which was still two years away. There was no evidence in the records released to us of an independent appraisal of the site from the Department’s property consultant.

Department ends up agreeing to pay €1.88 million for site plus VAT (€170k/acre + VAT)

But that’s not the end of the story, when the Department agreed with Shannon Homes to rent the site for the temporary school, part of that contractual agreement was that Shannon Homes would build a road and roundabout which already had planning permission at its own expense:

Throughout the documentation there are multiple references to this e.g.

However, in the end the Department ended up agreeing to pay Shannon Homes €1.33 million + VAT for works that it had already agreed would be done by Shannon Home at no cost to the tax payer.

We embed the documents below (note we have redacted personal data but some information has been redacted by the Department and this is under appeal to the Commissioner for Environmental Information)

Document 1 – Department of Education rents land from Shannon Homes in 2019 for temporary school

Document 2 – Long email exchange detailing negotiations to buy the site 2019 to 2020

Document 3 – Dept Preparing for final negotiation meeting with Shannon Homes – February 2021

Document 4 – Heads of Terms agreed 11 June 2021

Document 5 – Contract for Sale agreed November 2021