By: CECÍLIA PIRES
INVESTORS WHO bought off-plan properties at the Costa de Cabanas Resort in Tavira fear they may lose their money following the collapse of Irish company Kendar Holdings.
According to reports, the founder of the company, Irish solicitor Michael Lynn, owes more than 80 million euros to Irish banks and is on the run from Irish Courts.
A spokesman for the High Court said that the cases against Michael Lynn were a civil matter and ongoing but added that “as a result of failing to appear for a court date, an order has been issued to appear in court”.
A total of 136 legal cases were already pending against Michael Lynn by the time The Resident went to press.
Kendar Holdings sold the Costa de Cabanas development on December 6 to Vantea, a recently-formed company whose capital is in the hands of two Portuguese companies, Nota Breve S.A., and Número Misto S.A., both based in Alvor.
According to the Law Society of Ireland, based on a High Court asset freezing order and other related orders against Michael Lynn, he has no more power to “dispose of any assets in his possession or control, including those of associated companies”. This action is said to have triggered the collapse of the Kendar Holdings Group.
It is now understood that the Irish courts might ask the Portuguese authorities to act because, as the Irish Times reported on Saturday, Michael Lynn kept a two per cent share in the new company, Vantea, through his Kendar subsidiary in Dublin.
Now, to ensure that the Tavira development is finished in time, a group of 36 investors have hired a Portuguese lawyer.
He is said to be planning a claim against the land in Costa de Cabanas so that their assets are secure, the newspaper reports.
The Resident contacted the lawyer but he was not available for comment when we went to press.
The Irish Times also reports that a document dated April 18, 2007, showed that Kendar Holdings had received 12.1 million euros from investors in the first phase of 76 apartments.
The phase started in 2003, when Kendar Holdings teamed up with Celtic Developments, owned by Dublin property developer John Riordan, and other smaller investors.
The former AC Milan and Portugal international footballer Rui Costa is said to have been one of Kendar Portugal shareholders then, as well as Benfica footballer Nuno Gomes, who is said to have bought two properties in the first phase of the development.
The report in the Irish Times goes on to say that last summer Kendar received a loan approval of 25.6 million euros from Portugal’s largest private bank, Millennium BCP, to build phases two and three at the Costa de Cabanas resort.
Of this amount, six million euros was provided to Kendar Portugal on the day the loan was agreed, according to a Portuguese title deed obtained by the Irish newspaper.
The latest official declaration filed by Michael Lynn to the High Court, last November, showed that the largest cash balance in any of his 10 accounts with four Portuguese banks was 924,349 euros in an account in Millennium BCP, says the Irish Times.
Eric Burns, spokesman from the Millennium BCP Group, told The Resident he “could not confirm” if Kendar Holdings is or was a client of the bank. “We cannot talk about any clients due to the bank’s confidentiality regulations,” he said.
While the legal actions build up in Irish courts, Michael Lynn is now believed to be hiding in one of his resorts.
One of the solicitor’s last public appearances was reported in Tavira, when he was seen with his former accountant, Nuno Paulino, who is presently in charge of the Costa de Cabanas development.
The Resident contacted Mr Paulino to find out how Vantea is planning to assure investors that the Kendar case will not jeopardise the continuity of the Costa de Cabanas next construction phases. He was not available for comment by the time The Resident went to press.
Mr Paulino told the Irish Times that he had been with Michael Lynn at the beginning of the year in Tavira, adding that “despite Lynn’s financial difficulties, he wanted to protect his staff and clients by completing the Cabanas project”.
The accountant claimed the project still has “the support of Millennium BCP and local people”.
The value of the two undeveloped phases is 27 million euros but the completed properties are expected to sell for 50 million euros.
On Wednesday, the Irish Times reported that two modern office suites in Dublin owned by Michael Lynn are to be offered for sale by the receiver Martin Ferris.
Over six million euros is being sought for the three-year-old units.
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