State land sold at one-fifth of its value
Mental-health services lose out as the health service sells four sites at substantially lower prices than their values as stated on an internal document.
By Emma Browne
In the past five years the Eastern Regional Health Authority (ERHA) sold off four of its sites in the Dublin region for a total of €106m. But according to an ERHA internal document which valued these properties in 2002 and was circulated to board members, the total value of the four sites was €576m.
The ERHA, which oversaw four health board areas in eastern Ireland, sold off the properties between 2002 and 2004. The
ERHA has now been taken over by the Health Services Executive (HSE).
Village has seen the ERHA document, which valued 11 sites it owned around Co Dublin at 2002 prices. The document contained revised standard land valuations circulated by the Department of Health and Children to the ERHA. The 11 sites are valued on a per hectare basis and there is a total valuation for each. It was circulated to the ERHA board members at a board meeting in September 2003.
The largest of four properties sold by the ERHA in the last few years is the Grangegorman site in north Dublin city. It also has the largest value and sale price variation. In 2002 it was valued at €417m in the ERHA internal document, but in the same year its sale price was decided at €63.5m by a government working group.
The Grangegorman site houses St Brendan's Hospital, a psychiatric hospital.
In 1999 the government approved the purchase of 65 acres of the site by the Department of Education and Science from the ERHA. The department was purchasing the land for the Dublin Institute of Technology (DIT) which is to relocate there. The remainder of the site – five acres – would house HSE services.
A year after the transfer deal was announced, the ERHA sought an up-to-date valuation of the 65 acres to be given to DIT. It was valued at €152.37m. In 2002, when the ERHA had all its properties valued, one hectare at the site (2.4 acres) was valued at €15.2m – giving the 65 acres site a price tag of €417m. These figures are contained in the document given to the board of the ERHA in 2003.
However, an inter-departmental working group on the development of Grangegorman found the site to be worth substantially less in the same year. It had the land valued by Richard Ellis Gunne, working in association with the Valuation Office in 2002. They reported the property was valued at €64-70m and decided that the value of the land to be given to DIT was €63.5m. It is possible that the working group based this figure on 1999 prices, as that was when the transfer deal was announced. However this is not made clear by the working group's report. Also we know that the site was valued at €153m in 2000 and it seems unlikely that the price tag would have jumped €100m in one year.
In July 2004 the clinical directors in the northern health board (the health board area Grangegorman is in) expressed concern about the transfer deal. They wrote to the then minister for health, Micháel Martin, asking him to investigate the deal to transfer lands for €63.5m and where the money was going to go.
The €63.5m from the transfer is to go back into health services, a large portion into mental-health services. However, according to a HSE spokesperson the money will not be handed over until the Grangegorman development is completed. The development is in its early stages so the money transfer will take years.
As well as the Grangegorman transfer there were three other sites which were sold below the Department of Health and Children's 2002 valuations.
In 2004 the ERHA sold 22 acres from the grounds of St Loman's Hospital in Palmerstown, West Dublin, which also provided mental-health services. It sold the site to developer Glenkerrin homes for €31m. However in 2002 just 10 acres at the property were valued at €38m in the internal valuations document circulated to the board.
In 2004 Dublin City Council (DCC) purchased 17.5 acres at the Cherry Orchard Hospital site in Ballyfermot for €6.6m. According to the per acre valuation circulated to the board in 2003, the site should have been worth €73m.
According to the HSE this deal was decided between the ERHA and DCC in 1996, and therefore was sold to them in 2004 at the agreed 1996 price.
In 2005 the ERHA sold off 2.5 acres at the St Columcille's Hospital site in Loughlinstown, a general hospital in south county Dublin, for €5.35m. In the valuation carried out in 2002 the value of 2.5 acres at the hospital had been put at €10.5m.
All of the money from these sales is meant to be ring-fenced and re-invested in the health services. In relation to Grangegorman and St Loman's, the money is meant to go directly back to mental-health services in the areas where the sales took place. This was a key recommendation of the government's mental-health strategy – ‘A Vision for Change'.
Village asked the HSE to provide figures and details of where the money from the sale of these properties had come. They responded after six days and said it was a matter for the Department of Finance