Thomas Kenneth Whitaker, the architect of the modern Irish economy, who was born in 1916 in Rostrevor, County Down, Northern Ireland, was appointed Secretary at the Irish Department of Finance at the age of thirty-nine. It was a bleak time for the Irish economy, which by the end of the decade had haemorrhaged 20% of the population through emigration.
|A portrait of Dr. T.K. (Ken) Whitaker (b.1916- ), eminent civil servant and economist, whose study, 'Economic Development' was the basis for the First Programme for Economic Expansion, published in 1958, hangs in the National Gallery of Ireland. The portrait by Thomas Ryan P.P.R.H.A. was officially unveiled by Mr. Charlie McCreevy, T.D., Minister for Finance, in the National Gallery on Monday, April 22nd, 2002|
In 1958, Dr. Whitaker was responsible for the seminal paper Economic Development, the blueprint for the move from protectionism to free trade and the modernisation of the economy through the incentivising of multinational companies to establish manufacturing operations in Ireland.
One of the recommendations in Economic Development was to encourage an international hotel chain to open a hotel in Ireland as the then hotel stock in Dublin wasn't much to write home about.
In 1960, Irish and Intercontinental Hotels Limited was incorporated following an agreement between the Irish airports authority Aer Rianta, the Gresham Hotel Company, which ran The Gresham Hotel on Dublin's principal street O'Connell Street and the then American-owned Pan Am World Airways subsidiary Intercontinental Hotels Corporation. The plan was to develop hotels in Ireland.
|Walter Beatty, from the 2000 report.. Walter Beatty's father a Dublin solicitor, was one of twelve Dublin businessmen who bought the original Jurys Hotel on Dublin's Dame Street in 1924. Jurys moved to the former Intercontinental Hotel in Ballsbridge in 1972. The Beatty and Doyle families control the main share blocks in JurysDoyle Plc.|
In the 1960's, newly built hotels opened in Dublin, Cork and Limerick, branded as Intercontinental Hotels. The Dublin hotel was built on Pembroke Road in Ballsbridge, a leafy suburb in South Dublin. In 1962, at the corner of Pembroke Road and Elgin Road, construction began on a then futuristic style building for the US Embassy. In 1969, An Taisce, the National Trust of Ireland, honoured the Embassy with its premier award "for effective development of a prominent corner site on a main city approach, for sympathy of scale with existing environment and interest of character, without imitation of surrounding buildings, and for integration with existing trees and street setting". Ballsbridge was a prime location then as it is now.
The Intercontinental Hotels lost money and in 1972, the Jurys Hotel company acquired the hotels and sold its original hotel on Dublin's Dame Street. From the 1960's, Ireland's leading hotelier built several of Dublin's leading hotels, including the 5-star Berkeley Court Hotel, directly adjacent to the Jurys Hotel in Ballsbridge. Following P.V Doyle's death, the Doyle Hotels company was merged with the publicly quoted Jurys and the company became Jurys Doyle. On Tuesday this week, shareholders of Jurys Doyle approved the sale of the 4.84 acre site of the Jurys Ballsbridge Hotel for 260 million to a developer who plans to build multi-million euro residential apartments. The site of the 5-star Berkeley Hotel is also going to be sold and Ballsbridge will be left with 5-star hotel, the recently opened Four Seasons Hotel. However, a business traveller from Asia would undoubtedly scoff at this designation.
Today, the commercial property services company CB Richard Ellis Gunne said : total un-geared returns of 9.5% were achieved from commercial property in Ireland in the first six months of the year, leading us to believe that 2004 returns will undoubtedly be beaten this year. We expect that total returns of 15% are achievable, on the basis that yields continue to contract and rental growth is emerging in the occupational markets. This is particularly evident in the office sector, where prime headline rents in Dublin’s city centre have now exceeded €538 per m2 – the third highest in Europe after London and Paris.
Dublin's principal street O'Connell Street is currently being refurbished and it has for long been a centre of gaming arcades and fast food joints while two small European provincial scale shopping streets, Grafton Street and Henry Street, command some of the highest retail rents in Europe.
Dublin isn't landlocked and there is no shortage of land in Ireland. A CB Richard Ellis report says that Dublin is the seventh most expensive city for office space in its survey of 174 cities worldwide. The cost of prime office space in Dublin is almost twice that in Brussels, the capital of the European Union.
|US Embassy, Ballsbridge, Dublin|
Planning and construction related corruption has been a serious issue in Ireland for decades and the biggest political party Fianna Fáil, has largely relied on funding by the construction industry. Since 1997, a public tribunal has been investigating planning corruption. However, there have been no changes in the system for rezoning land from agricultural use for development.
In 1973, a report by a Government-appointed committee (the Kenny Report) recommended that local authorities should be empowered to acquire land for housing for which the owner would receive its current (typically agricultural) use value plus a maximum of 25 percent. Land rezoning is similar to the illegal drug trade. Who should be surprised when corruption is promoted where the value of land can change twenty-fold through a political decision?
Property is the new God in Ireland and politicians do no feel under pressure to reform the corrupt system as in a market of surging values, the majority of voters perceive a vested interest in the system, once they have a foot on the property ladder.
So Dublin has come almost full circle in hotels from Dr. T.K. (Ken) Whitaker's day. The city has plenty budget lodging houses of mixed standard, many of them built with generous tax incentives. Jurys Doyle sees its future in budget hotels and has the support of the inherited wealth of the Beatty and Doyle families. A capital with a thriving offshore financial centre and base for European headquarters of many multinational companies, has little to offer on the quality side.
So Ballsbridge is going to get expensive New York style apartments with doormen and other expensive flunkeys but with developers in search of more real estate, the rents of the few restaurants in the area is bound to prompt more changes.
There may at least be an opening for such services as pizza delivery to those expensive apartments!