Costa de Cabanas development

Fugitive solicitor Michael Lynn is at the centre of a new fraud probe after Hungarian police received complaints about his property dealings there.
The lawyer who fled Ireland owing €83m in multiple-mortgage debts was in Budapest as recently as Tuesday in a desperate bid to keep his property empire float.
Police have launched the fraud investigation following the collapse of a 156-apartment development owned by the fugitive solicitor into which Irish SSIA investors have ploughed their savings.
An Irish Independent investigation has found:
l Lynn began selling off his foreign companies weeks before he absconded last December. l He recently gave one Hungarian colleague power of attorney over his affairs "for the whole term of my incapacitation".
l Complaints were filed with the police in Budapest after the 156 apartment Sziv 61, owned by Lynn's Croi 61-- translated as Heart 61 -- was abandoned by builders in December.
l Lynn's wife, Brid Murphy, is expected next week to challenge a raid on the home she shared with Lynn at St Albans, Sandymount, by the Dublin Sheriff's office.
The news from Hungary will come as a major blow to individual Irish backers, who have already laid down tens of thousands in deposits for the Sviz 61 apartments and townhouses.
Builders walked off the Sziv 61 site last December, unaware that Lynn had in fact sold it on November 30, and complained to police after "questionable" agents claimed they were representing the Mayo-born lawyer.
"A few questionable companies and civilians turned up 'representing' Michael Lynn and handled in some fake authorisations that they could act on behalf of Lynn," said Attila Toth, the head of the Plan 60 building company.
"We rejected these authorisations and reported it to the police as our lawyers thought it was a question of forgery and fraud."
Documents filed with the Hungarian companies registrar show Lynn sold on Croi 61 on November 30. It was bought out by Raspotec, which shares Croi 61's Hungarian address and is ultimately owned by Cyprus-based Morgar Trading.
Mr Toth, however, was not made aware of any changes of ownership.
The builder now says the equivalent of €1m in fresh funds is needed to complete the development. Failing this, he plans to pursue Croi 61 for the equivalent of about €370,000 in penalties.
News of the Hungarian police probe comes as the Irish legal community braces itself for fresh "revelations" about the scandal that are expected to unfold in the High Court on Monday.
The Dublin Sheriff's office recently broke locks to get access to Lynn's Sandymount home. Officials removed several items, including boxes of "reasonably good" French wine; chairs, tables, mirrors, a washing machine, tumble dryer and microwave.
Seized
The items were seized on the back of High Court orders obtained by the banks last month, but his wife Brid has claimed that, as a joint owner, she was not given due notice of the raid and is seeking the return of items owned by her.
Lynn's Hungarian dealings were uncovered during an extensive Irish Independent trawl of the Mayoman's overseas companies.
The review of his main holding companies reveals the solicitor remains the sole owner of several companies in his main markets of Bulgaria and Hungary.
The ownership structure of Lynn's Portuguese operations, which are behind Costa de Cabanas -- his largest remaining development -- remains unclear as they don't have to file ownership information.
Accounts for Lynn's eastern European holding companies show the largest company has accumulated profits of less than €400,000, which will provide little comfort to banks and investors who are owed millions.
Apartment
In Hungary, Lynn's Kendar property firm was supposed to be building out Sziv 61, 49 apartments in Budapest's Eotvos Street and 105 apartments in Budapest's Amber Square.
Sziv 61, which translates to Heart 61 in English, is owned by Hungarian registered Croi 61.
Croi 61 was founded by Michael Lynn in 2005 and owned by the Mayoman until November 30.
Lawyers tidying up Mr Lynn's Hungarian affairs have previously said that money for Amber Square seemed to be "completely gone" while Eotvos is expected to be built out.
In Bulgaria, local representatives insisted before Christmas that a ski development in Bansko would be completed. The office did not answer calls this week.
Meanwhile, files at the Sofia court house show Lynn is the sole owner of Kendar Bulgaria.
Calls to Portuguese manager Nuno Paulino were not returned this week.
Mr Paulino is responsible for building Kendar's most prestigious project, the 282- property Costa de Cabanas development in the Algarve, in Portugal.

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Viva Estates agency hit by recession

Viva Estates agency that claims to be the Costa del Sol’s largest has laid off 120 of its 160 staff.has shut 95 per cent of its offices in a bid to fight the current recession.
The company has seen sales figures drop by over two thirds since 2003.
In 2007 the agency achieved just 550 completions, in comparison to 1,500 in 2003.
In a desperate bid to save the business, it has shut 13 out of its 14 offices, including flagship branches in Puerto Banus, Fuengirola and Alhaurin, and cut back on its huge UK advertising bill.
Blaming the collapse on the internet and the corruption scandals that have engulfed Andalucia,
“The boom brought a lot of cash to the Costa del Sol and every Tom, Dick and Harry coming in to try and make money.
“But most clients now use the internet and where offices were getting an average of 60 walk-in clients a month five years ago, last year they got just six
“With various town halls raping their coffers to the tune of hundreds of millions of euros it has not helped.”
The company is now functioning on a skeleton staff of 40 from the main office in El Rosario, between Marbella and Calahonda.
“I am optimistic that we will still be here when the market comes back. I lived through the last boom, when no-one had any money and everyone drove old bangers.

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The foreign property owner in Spain a species in danger of extinction

In Spain, a whopping 96% of mortgages are on floating rates, rather than fixes - so every rise hurts almost every mortgage holder.
It looks like the Spanish may be the first group of Europeans to experience a painful ending to the global property boom.
Last week, the Ibex index in Madrid was battered as shares in Valencia-based builder Astroc dived after its accounts revealed that some of last year's profits came from the sale of assets to its chairman, leading to fears that the company was trying to prop up its share price. Its fellow building stocks took a tumble as the fears spread to wider concerns about the property market in general. Spanish house prices have risen 270% in the past 10 years. But now house price growth is faltering, slowing from annual double-digit gains to growth of 7.2% in the first quarter of this year. In many areas, the Costa del Sol included, prices are falling.
And the truth is that the statistics on the Spanish property market make for frankly terrifying reading for anyone who is thinking of, or is already, investing there.
Massive oversupply
The supply and demand statistics are awful for a start. More than 800,000 homes were built last year - that's more than France, Germany and Italy combined. That's even though Spain has the lowest birth rate in the EU, along with Italy – women now have just 1.3 children on average.
That's all bad enough - but Spain's market is also unusually vulnerable to rising interest rates and panicky speculators. In a country of 40 million people, four million foreigners own property, including 250,000 British people.
One of the main reasons that property bulls - and sometimes more sober experts - often claim that house prices won't fall is because if you own a home, and prices are falling, you will tend to hold off selling unless you absolutely have to. So the supply of homes on the market dries up, keeping supply and demand broadly balanced, meaning prices remain roughly stable, until conditions pick up again.
No desire for many to hold
This is debatable on many levels - but even if you accept that argument, the problem for a market like Spain is that holiday home owners and fly-to-letters have neither the desire, nor in many cases, the financial reserves to sit on a property that is falling in value. And that's not even considering the number of ex-pats who emigrate, only to turn around and come back within the first few years of moving.
On top of that, many second home-owners are largely relying on money released by remortgaging their main residential property. So with interest rates rising, for example, in the UK, sustaining two homes is becoming more difficult for all those property moguls who have overstretched themselves to buy their place in the sun.
European handcuffs
In Spain, the situation with interest rates is even more grim. Because it's part of the eurozone, Spain can't set its own interest rates. And the reality is that eurozone rates are largely set with Germany in mind. The trouble is, Germany has been at pretty much the opposite end of the business cycle from the rest of the world (except maybe Japan) for about 10 years now. Rates were very low when Spain joined the euro, which fuelled the boom in the first place - as Bank of Spain governor Miguel Fernandez Ordonez says: "The single monetary policy has meant that excessively loose conditions for our economy have been almost continuous."

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Small constructors and developers have closed down

Prices are falling in some areas, but because many properties are second or holiday homes, owners are reluctant to drop asking prices, unless they are anxious to sell. It was reported that many small constructors and developers have closed down in the past few months in the Valencia region, about 20% of the 13, 000 plus. Many of these small enterprises are in fact, front companies for the larger ones- they hire the illegal workers, enter into the shady deals, etc. and when things go wrong they simply fold their tents, declare bankruptcy and disappear. While the number of employees in major enterprises has recently shown a small increase, these numbers do not account for the thousands of contract , temporary or illegal workers who have been let go in recent months. To avoid paying for the August vacation or being forced to hire on a permanent basis, many thousands of construction workers were dropped at the beginning of the summer holiday period. There appears to be no way of knowing how many have been hired again, but the downturn in construction suggests that very few have work-and most have no social security net to fall back upon.

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The price of second homes in the Mediterranean could fall

The price of second homes in the Mediterranean could fall as a result of the credit crisis, a leading property expert has warned.
Michael Ball, a professor of property at Reading ¬University, England, and an adviser to the UK government, said holiday homes in many parts of Europe were exposed to a correction.
Not only had prices risen fast amid speculative interest and the easy availability of credit, but the supply of new flats had been increasing at a prolific rate.
Prof Ball pinpointed the Mediterranean and central and eastern Europe as being particularly “vulnerable” to falling prices.
“There are a variety of reasons in that in both of those areas, credit has been used and people have been very optimistic about long term values,” he told an audience of property professionals on Thursday night.
“There has been a boom, the market has been driven by foreign investors and now that is beginning to turn.”
The professor cited, as an example, Estonia, where house prices had dropped by an estimated 10 per cent in the past 12 months. “That will probably trickle through to other countries,” he said.
Savills, the estate agency, says the value of British-owned homes overseas have risen from £7bn in 1994 to £52bn ($106bn, €75bn) today through new purchases and rising prices.
The most common motive of buyers is to make a profit – rather than to have somewhere to go on holiday – according to a survey by the company. This speculation might have made some markets even more precarious. Some buyers might have overestimated the potential rental returns that they can get through letting these properties.
Prof Ball said many such markets were “risky” because there was no history of what fundamental values should be.
Ian Marcus, head of European real estate at Credit Suisse, said he believed there was “a large over-supply” of holiday homes in many European resorts.
The warnings come amid widespread price falls in the second home markets of Florida with some resorts seeing double-digit drops in the past year. The number of home sales in Florida dropped 43 per cent between the first and second quarter.
In Spain, demand for second homes on the Mediterranean coast has been softening for two years, according to estate agents. Many have reported a virtual standstill since May after a series of corruption scandals and a collapse in property¬related shares.
At least one mid-sized developer – Llanera – faces bankruptcy. One central bank official in Madrid said: “There is growing evidence that smaller real estate companies and house-builders who launched projects late in the cycle may have problems.”

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18,000 dwellings were built illegally during the administration of Jesus Gil

18,000 dwellings were built illegally during the administration of Jesus Gil and his local party, GIL. The Junta de Andalucia (socialist) and the new town council of the town (PP) are discussing how to resolve the situation. The Junta presented a General Plan in which it foresees “a revision and regularisation” of the illegal construction, plus construction of 50,000 new dwellings over 10 years and a declaration of 3.8 million m2 as green zones. However, part of the new green zones is declared as “urbanizable” in the previous general plan (meaning earmarked for construction). If the land is expropriated, the private owners may get only 30 to 35 Euro per m2 against the 800 which they paid
The solution may be to demand contributions from the promoters/owners of the illegally constructed dwellings. Since many of the promoting companies from the Gil Era have disappeared, this will mean private owners of the illegal dwellings will be presented with the bill. The new mayor, Angela Muñoz, recommended the people affected should present official complaints. The lawyers are looking forward to year long process.

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The Andalucian Ombudsman, Jose Chamizo has supported the demolition of 334 homes in a total of seven developments in Marbella.

Antonio Banderas luxury home La Gaviota built practically on the beach.
will be bulldozed.

The Andalucian Ombudsman, Jose Chamizo has supported the demolition of 334 homes in a total of seven developments in Marbella.
Marbella and in El Palmar, Cadiz, hundreds of houses are expected to get bulldozed this year.In Malaga, the Prasa hotel on Estepona’s beachfront is expected to be knocked down imminently, with the coastal authorities having agreed to stump up the 1.2million euro bill.Marbella town hall is also likely to soon announce the demolition of dozens of buildings, including the infamous Banana Beach development built on green land.
In Obeja, Cordoba, over 30 policemen were on hand to keep the angry residents away from their properties as the bulldozers moved in.
Grown men wept dusty tears, as their country retreats on the Pedrique urbanisation, in the heart of the Sierra Morena, were levelled to the ground.
An ambulance had to be called when one owner collapsed after suffering a panic attack.
It took two bulldozers only half a day to demolish the group of houses that number five of over 100 illegally built at Pedrique.
The residents belongings stood poignantly on their carefully clipped lawns as the diggers moved in.
One owner Antonio Moreno had moved here permanently after suffering depression following retirement.
“This situation has only made it considerably worse,” explained his wife Maria Moreno.
The case began when three years ago a promoter Francisco Otero sold the shells of the buildings to the five individuals.
What the buyers didn’t know was that Otero had never attempted to get planning permission “because he knew he would not get it”.
The case ended in court with Otero found guilty of both planning crimes and disobedience. In 2006 he was sentenced to a 20 months in prison and fined 2,500 euros.
He was also ordered to demolish the buildings at his own cost.
This week, the furious owners – who have begun proceedings against Otero - demanded to know why the town hall or local police had not advised them of the illegality of their homes.
“When he sold us the terrain he said the town hall was legalising the whole urbanisation, said Fernando Lora. “Why didn’t anyone come and tell us what might happen when we were finishing the houses.
“We are the victims of a completely unfair crime.”
A spokesman for environment group Ecologistas en Accion appauded the decision of the courts to order the demolition.
“They started building these homes in the 1970s in the Sierras above Cordoba. It has ruined the area and we salute the authorities for moving in.”
Around the province of Cordoba various other demolitions have been scheduled.
Apart from the other 100 homes at Pedrique, at Medina Azahara, UNESCO has demanded that 240 illegal houses built on highly protected land are knocked down.
At least one property in the area of Las Monjas in Puente Genil is expected to be demolished, while another at San Cristobal will be axed for “gravely destroying the countryside”.
The situation is similar in Granada where the town hall has just ordered the demolition of eight houses in an area of special protection known as Cantogrande, while another two have been ordered to be knocked down in Bobadilla and Serrallo.
They are some of over 40 houses ordered to be demolished in 2007 and owners have a month to appeal or submit and pay the town hall 600 euros to help fund the demolition.
In Cadiz the mayor of Vejer is hoping to legalise 280 houses that have been built without licences on the beach at El Palmer, but this still leaves over 1,000 illegal houses in the area.
At the same time the town hall has just ordered work to stop on 35 houses in the Padron area, which has never been designated as building land.
Marbella town hall is also likely to soon announce the demolition of dozens of buildings, including the infamous Banana Beach development built on green land and even Antonio Banderas luxury home La Gaviota built practically on the beach.
In total, there are more than 400 developments facing the axe in the town.
The President of the Marbella Management Committee, Diego Martin Reyes, has said he is worried about the situation, but that he was convinced that the firm sentence from the Andalucian Supreme Court ordering demolition should be carried out.

Meanwhile the Andalucian Ombudsman, Jose Chamizo has supported the demolition of 334 homes in a total of seven developments in Marbella.

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Seven people who were being held hostage in Lepe

A group of seven people who were being held hostage in Lepe and Cartaya, Huelva province, were freed this weekend, in a Civil Guard operation which took the seven kidnappers into custody. EFE says two of the kidnappers lived in Cartaya, itself, three others from elsewhere in Huelva province, another in Madrid and the seventh in Holland. Two of them have Moroccan nationality.
Four of the hostages were found under guard in two vehicles parked near the Marina Ocio shopping centre in Lepe following a report to Lepe local police from the son of one of those who were being held. He said his parent was being held by kidnappers in the area after being missing from home for two days.
The kidnappers were nearby and were arrested as they tried to escape.
The remaining three hostages were found near a chalet in Cartaya, four kilometres outside Lepe, after managing to escape when the kidnappers left. All seven were previously held captive in the property.
There was no indication in the report if the kidnappers had made any demands for a ransom.

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Marcos J.R.C Kidnapper

A temporary construction worker has been arrested in Telde in connection with the attempted kidnap of the ten year old child, Sandra Domínguez, in the La Garita area of the town on January 4.
The 37 year old suspect who has been named only as Marcos J.R.C., is said to have a police record and was seen in a white van in the area. The victim has recognised him in a photo.
Marcos now goes before the Instruction judge 2 in Telde, Óscar Rey, accused of attempted kidnapping. Police say they are now searching for a possible accomplice in the case.

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Dean Fitzpatrick brother of Amy Fitzpatrick interviewed

Dean Fitzpatrick, the brother of 15 year old Amy who has been missing from her home in Mijas since the evening of New Year’s Day, was called to the local Civil Guard barracks on Monday, where he was interviewed for around an hour for any information which could help detectives locate his sister. It’s now been two weeks since she was last seen.

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