Hoppkins was not the only problem on Fitzwilliams’ plate. He had other hard decisions to make. One of them concerned Brendan Allen, an Irish tycoon, drowning under an ocean of debt and deeply in hock to the Irish Netherlands Bank. Amongst other things the bank held a mortgage on Allen’s Knightsbridge home, bought only two years earlier for over fifteen million pounds.
Allen’s property fund was located in his large terracotta brick Victorian house, designed by the renowned architect, J. J. Stevenson in the 1870s in the so-called Queen Anne style. It was just a short walking from Fitzwilliams’ London pad and conveniently around the corner from Harrods. Allen lived in a four-bedroom apartment on the upper floors beneath the elegant gables of the house. A direct lift, connected the flat to the basement level, where the tycoon had built swimming pool complete with a sauna, gymnasium and solarium, where in happier times the tycoon and his friends, Fitzwilliams amongst them, had often got together to enjoy a cold beer after a workout and a swim.
Allen’s life style was a clear indication that many people in the financial and property world had been spending money they did not have. The tycoon, yet another victim of excessive ambition, had overextended himself and to escape bankruptcy had no alternative but a fire sale.
Brendan Allen made the mistake of investing in Cassel & Powercourt Holdings, the Dublin property company founded of Padraigh Burke, his long-time friend. When the crisis hit Ireland the company with over two billion pounds worth of residential and commercial assets in its hands ran into deep trouble. Burke solved that by putting a bullet in his head, leaving Allen to face huge asset write downs.
‘Pat, correct me if I’m wrong, but I seem to remember you were fairly thick with Allen,’ said Fitzwilliams.
‘We all were Fitz.’
‘Neither a borrower nor a lender be;
For loan oft loses both itself and friend,
And borrowing dulls the edge of husbandry.’
Kennedy looked blank.
‘That’s Lord Polonius.’
‘Never met him.’
‘Hamlet, Shakespeare!’ sighed Fitzwilliams in despair. He would never understand Kennedy’s strange universe.
Allen’s rise and fall was a legacy of the Celtic Tiger’s boom years when the Irish Netherlands Bank expanded, lending to property investors and high profile funds such as Cassel & Powercourt Holdings, then a young company built by Burke on the spectacular growth of Irish asset values.
Allen started at the bottom, growing up in a modest hard working Dublin family His first and only job as a wage earner was in a small estate agents, where he got to know the workings of the property market in and around south Dublin. Seizing on an opportunity he bought a small run down farm with a loan from the Irish Union Bank, which after a long and difficult renovation he sold for a small profit. The experience taught him to be more careful in choosing properties and builders. With that in mind he repeated the operation. Then when the Irish property boom took off he was ready to make some real money.
Money was easy and once he felt sufficiently confident he bought his first home, an ambitious fifty acre estate that offered the kind of privacy few could afford. The neighbouring farm was bought by another up and coming young businessman, Padraigh Burke.
With the crash Cassel & Powercourt Holdings epitomized all that had gone wrong with the Irish market. The business had been built around huge loans, expanding, what had in reality been a relatively modest Dublin based business, into a multinational with operations in London and beyond, a growth path that echoed Icelandic megalomania.
The Irish Netherlands Bank had provided a large part of the funding for Cassel & Powercourt Holdings’ overseas projects through the Nederlandsche Nassau Bank with the approval of Jerome Hiltermann in Amsterdam. The rest was raised by Allen in compartmentalised loans from the Nassau Investment Fund in London.
The curtain had fallen on Allen’s moment of glory. Gone were the days when he jetted between Dublin and London, enjoying weekends in Biarritz and drinking Champagne with his Russian friends. It was time for Fitzwilliams to pull the plug, he had little alternative, friend or no friend, he could afford no favours given the speed with which the value of commercial property was falling.
Chapter 25 A GREEK TRAGEDY UNFOLDS
The Plan Page 25