Donegal building firm goes bust

A Donegal building firm that paid a €100 deposit for a €19 million land deal at the peak of the boom has collapsed into receivership.

Bank of Scotland (Ireland) has installed Tom Kavanagh of insolvency firm Kavanagh Fennell as receiver to McGinley Construction.

It is understood that the firm has debts of around €30 million, with the bulk of the money owed to banks. Trade creditors are also owed a seven-figure sum by the firm.

McGinley Construction is based in Lifford and initially focused on house building in Co Donegal. It later moved into the Dublin market and built apartments in the East Wall Road area and in Killiney in south Dublin.

In 2008,the firm was sued by two businessmen who said they had a contract to sell McGinley Construction land at Ravensdale Road in Dublin for €19 million. McGinley Construction had paid a €100 deposit but had not paid the balance by the agreed date of May 31, 2008.

At the time, Mr Justice Peter Kelly said it was ‘‘extraordinary’’ that a €19 million land deal was based on a €100 deposit.