The National Asset Management Agency (NAMA) was established in 2009 to rid local banks of risky loans made before a property market collapse, as the Irish economy went into a meltdown that forced Dublin into a 85 billion euro international bailout.

It recently increased its profit forecast to at least 1.75 billion euros thanks to a surge in demand for Irish real estate, and Chairman Frank Daly said on Thursday that could go even higher.

"Other than saying that you could speculate it could be over 2 billion (euros), we're not going to be any more precise," he told a news conference, referring to the surplus NAMA will return to the state upon its planned wind-down in 2020.

Profits will be driven by plans to fund the building of 20,000 new homes and a major new docklands business district that Ireland's finance minister has described as Dublin's answer to London's Canary Wharf.

The 5.6 billion euro residential project and 1.9 billion euro docklands plan are aimed at easing a severe shortage of housing and high-quality office space.

NAMA said the programmes were likely to increase its projected profit and that it was confident they would not affect plans to redeem all of its senior debt by 2018 and junior debt two years later.

Chief Executive Brendan McDonagh said the agency also expected to bring two major loan portfolios to the market next year, each with a par value of around 3 billion euros.

He said expectations that NAMA may ultimately make a profit of more than 2 billion euros were based on forecasts of house price growth in Ireland of 2-3 percent per year over the next five years and office space prices of at least current levels of around 50 euros per square foot.

To lower the risks associated with moving from selling properties to funding them, NAMA said it will look for joint venture partners to co-fund and construct the projects.

It has already built out some of the half-finished stock it took over. But with less than half of the 25,000 new houses needed each year being built, the plan to construct 20,000 units by 2020 was announced in the government's budget in October.

The docklands plan had also been flagged but details added on Thursday included plans for 15 major new city blocks, almost 4 million square feet of office space, 2,000 new apartments, Dublin's tallest office block and a 169-bedroom hotel.

(Writing by Padraic Halpin; Editing by Mark Trevelyan)

By Conor Humphries