Potential New Ground

[LondonRoader]

New goalposts I see, I'm also confident of positive news from the club on their future whenever it comes out.

I delibrately didn't go into details, because when I do you jump straight on it demanding evidence which could never be released at this stage due to commercial sensitivities. I am happy with the situation and expect others will once it becomes public knowledge. My thoughts are clear and haven't changed one bit. If you think otherwise, then that is perfectly fine.
[/QUOTE]
Its ok thanks for your opinions.

 

[uptheus]

That might be sooner.

What makes you say that?

 

[Essexyellows]

Hasn't it been questioned repeatedly, as to what return the 'investors' would get out of staying at GR and updating it?

Flats in the corners, extended corporate/function facilities in a large "West Stand",taking ownership of all the stadium revenue, expanding that stadium revenue, ground share with a rugby club, events through the summer ..... and using that income to fund a club into sustainable Championship (or more level)........ nope can`t see anyways of making money out of it.

 

[AbbeyOx]

Flats in the corners, extended corporate/function facilities in a large "West Stand",taking ownership of all the stadium revenue, expanding that stadium revenue, ground share with a rugby club, events through the summer ..... and using that income to fund a club into sustainable Championship (or more level)........ nope can`t see anyways of making money out of it.

sounded good until you said share with a rugby club

 

[Essexyellows]

sounded good until you said share with a rugby club

Just a potential revenue stream for a stadium owner.......... Brentford, Reading etc don`t do it for free I guess. I won`t mention the situation at the Ricoh though!! ?

 

[yellowbow]

Have you looked to see who is on the Board (and for Londonroader, who the investors are)
Have you seen what their expertise is? Do you honestly think that they are here to buy the Kassam/ extend and refurbish at huge cost?
Do you not think that they will want to do a Kassam (hopefully more generously than Kasdam to the club).
Who has made a load of money out of owning a football club in.the FL?
Kassam.

The concern I have is that Tiger has been able to attract these people because of the POTENTIAL that the situation with OUFC presents, but how many previous owners have seen potential and then realised that it’s never going to materialise once they get to know who the dominant players are in all this - FK, CC and OU for example? As recently as the last fans forum it seemed apparent to me that, unless there’s a lot of cat and mouse going on, there still isn’t a definite plan as to what the strategy is going forward. Zaki hinted at a possible new stadium while NM hinted that a new lease at Grenoble Road was still a possibility.
A key element to all this is maybe what FK’s fyou’re plans are. A quick google search shows that he’s now 65 and his wealth has gone up from around 180M in 2009 to 315M a couple of years ago. Does he still want the Grenoble Road development in his portfolio? Who know? Maybe a better relationship between FK and Tiger will lead to him relinquishing the whole complex for a decent price? The new owners, with new drive and impetus, could possibly see a big return there?

 

[horseman]

A few pennies in relative terms or sold for housing hmmm let me think !!!!

 

[yellowbow]

A few pennies in relative terms or sold for housing hmmm let me think !!!!

Can it definitely be sold for housing and demolished though? Would the local authorities sanction that? Are there covenants involved? All genuine questions, I haven’t a clue now as to what are facts and what’s just speculation.

 

[Essexyellows]

Round these parts land for housing (with planning) sells for roughly £750k - £1 million an acre.

From that there are deductions for services, ancillary work, PPG16 etc.

I know one landowner who has strategic/growth PP for 3,000+ houses on his land and recently sold a 19 acre field for £15 million after costs.

That makes the GR site worth £XXXXXX + a South East precept.

However the club then have to buy a site, if it is of similar size and development potential, then that too will have a premium.

Then you have to pay out £20 million + to build a ground on it, get planning etc.

In short you have spent an awful lot of money upfront without any return on investment.

It could be up to 10 years before any ROI starts to show but I`m sure there are others with more knowledge than I who could confirm/deny that?

FK played an absolute blinder to be fair to him, he bought the club and a partly completed ground for peanuts, sold the Manor and made enough to fund the ground with some swift accounting moves.
He`s the only person now, or in the foreseeable future, who will make a substantial amount of money from owning the Club.
He may even consider selling the stadium, doesn`t mean he has to sell the land under it.......................

 

[McVicar]

Jesus Christ if I was worth £315M when I'm 65 I couldn't give a toss about a few extra mill for a football stadium I'd gladly sell it for a fiver and sail off into the sunset............

 

[horseman]

As i've said before what income does Uncle F actually get from the other activities at the stadium? he is a clever Businessman and one would think that he would not miss any potential income streams..Regardless of any sanctions etc i would imagine the land alone is worth a few quid and if various authorities wanted to build houses after purchase they would.

The main concern if buying the stadium is a runner is that Uncle F doesn't let it drag on, if the club Owners want it then surely they need to act on it as any long drawn out process does nothing for the club especially when any alleged other locations would be put on the back burner.

Either they want the current stadium or another site has been identified, whichever is the case i see no issue with stating so as it's not like they are required to state location.

I still remain very cautious about any new build/complex as once obtained and their income streams sorted the football club will still need proper funding and if the current group walk any new owner is/could be left the same as now with a stadium that let's be honest is not going to suddenly bring in vast income or else fk would be doing that at the current site.

 

[ZeroTheHero]

Flats in the corners, extended corporate/function facilities in a large "West Stand",taking ownership of all the stadium revenue, expanding that stadium revenue, ground share with a rugby club, events through the summer ..... and using that income to fund a club into sustainable Championship (or more level)........ nope can`t see anyways of making money out of it.

Can you explain this to me, as I don't get it.

Presumably you aren't thinking Kassam is going to do any of this for us? So, someone else is going to have to do it. In order to do so, they will have to buy the stadium, build the flats, refurbish the stadium and extend the conference facilities. Is that right so far?

Let's take a (very) conservative figure and say you could do that for £20m, taking into account build costs and Kassam's price for the stadium. Having had a quick look online, commercial loan rates are about 4% and you can get an 80% mortgage. So if someone put down £4m, the loan would be £16m. The interest on that would be £640,000 per year. Of course, you still have to pay off the capital amount. Let's make it easy and say whoever provides the cash is happy to get it back in 20 years. That's another £1m a year to pay back.

As income you then have the rent (or proceeds) from the flats, the rent from the rugby club (shudder), some money from the conference facilities, bits and bobs from catering and advertising and income from events in the summer (maybe a couple of large concerts?). Keeping the club separate, so money from tickets would go as at present to the club.

Let's presume that this is all set up so it is at least no worse for the club than under the current regime (if it is a worse arrangement we might as well start forming the phoenix club now!) - and we have to pay £750,000 a year to play there as now (a guess). That means the profit from the other income would have to be (£1m + £640,000 - £750,000) £890,000 just to service the debt. And that's the profit - you have to account for all the costs (business rates, taxes, staff, maintenance etc) out of the income first. And of course if you wanted to reduce/remove the charge the club has to pay, then you have to find up to another £750,000 per year of income to make it work. If you want to use some of the stadium income to fund the team in addition, that's yet more income to find. Let's say the club is given another £1m a year (which of course is laughably small in Championship terms, and just as an illustration) to bolster the team and pays no rent. That would mean the stadium would have to generate a profit of £2,640,000 per year to fund the team and service the debt.

So we are in a situation where the stadium would have to generate anywhere between £890,000 and £2,640,000 or more per year of (taxed) profit to be sustainable.

Now you can certainly argue with those figures to some degree - but I have tried to underestimate costs, while also making the maths easy! Is it likely that the stadium could generate that amount of profit per year? It seems like a hell of a lot to me. And is the fact that nobody has tried to do it an indication that it is not in fact doable?

As I said - can someone who thinks we can make this work explain to me? I must be missing something!

 

[yellowbow]

Can you explain this to me, as I don't get it.

Presumably you aren't thinking Kassam is going to do any of this for us? So, someone else is going to have to do it. In order to do so, they will have to buy the stadium, build the flats, refurbish the stadium and extend the conference facilities. Is that right so far?

Let's take a (very) conservative figure and say you could do that for £20m, taking into account build costs and Kassam's price for the stadium. Having had a quick look online, commercial loan rates are about 4% and you can get an 80% mortgage. So if someone put down £4m, the loan would be £16m. The interest on that would be £640,000 per year. Of course, you still have to pay off the capital amount. Let's make it easy and say whoever provides the cash is happy to get it back in 20 years. That's another £1m a year to pay back.

As income you then have the rent (or proceeds) from the flats, the rent from the rugby club (shudder), some money from the conference facilities, bits and bobs from catering and advertising and income from events in the summer (maybe a couple of large concerts?). Keeping the club separate, so money from tickets would go as at present to the club.

Let's presume that this is all set up so it is at least no worse for the club than under the current regime (if it is a worse arrangement we might as well start forming the phoenix club now!) - and we have to pay £750,000 a year to play there as now (a guess). That means the profit from the other income would have to be (£1m + £640,000 - £750,000) £890,000 just to service the debt. And that's the profit - you have to account for all the costs (business rates, taxes, staff, maintenance etc) out of the income first. And of course if you wanted to reduce/remove the charge the club has to pay, then you have to find up to another £750,000 per year of income to make it work. If you want to use some of the stadium income to fund the team in addition, that's yet more income to find. Let's say the club is given another £1m a year (which of course is laughably small in Championship terms, and just as an illustration) to bolster the team and pays no rent. That would mean the stadium would have to generate a profit of £2,640,000 per year to fund the team and service the debt.

So we are in a situation where the stadium would have to generate anywhere between £890,000 and £2,640,000 or more per year of (taxed) profit to be sustainable.

Now you can certainly argue with those figures to some degree - but I have tried to underestimate costs, while also making the maths easy! Is it likely that the stadium could generate that amount of profit per year? It seems like a hell of a lot to me. And is the fact that nobody has tried to do it an indication that it is not in fact doable?

As I said - can someone who thinks we can make this work explain to me? I must be missing something!

They only way I could see Grenoble Road being in any way an attractive proposition is if the whole complex, including retail outlets, restaurants, cinema and hotels is made available. We know that it’s highly unlikely that FK would want to give all that up but, as I said in a previous post, he’s not getting any younger, he seems to have an extensive portfolio to be making the serious dosh that he is. Does he still really want real estate in East Oxford? Maybe if he can knock down the current set-up and build houses but how big an if is that?
As for our present owners, I was quite surprised at how wide the spectrum of possible options were, still being considered. At one end we had Zaki and the new stadium option and at the other end Niall talking about the possibility of renewing the lease. I know things have to be kept confidential but, to me, it all seemed a bit ‘fluffy’ still.

 

[Manorlounger]

Just to remind folks, FK has a family. They will be looking to inherit his estate. He, in turn, will be looking to leave them an estate that will see them well off. So, he ain't going to be doing OUFC any favours, anytime soon.
He has just put up new signage at Grenoble Road renaming the "Ozone" as the "Kassam" leisure centre. He obviously has a desire for a legacy.

 

[OUFC1978]

They only way I could see Grenoble Road being in any way an attractive proposition is if the whole complex, including retail outlets, restaurants, cinema and hotels is made available. We know that it’s highly unlikely that FK would want to give all that up but, as I said in a previous post, he’s not getting any younger, he seems to have an extensive portfolio to be making the serious dosh that he is. Does he still really want real estate in East Oxford? Maybe if he can knock down the current set-up and build houses but how big an if is that?
As for our present owners, I was quite surprised at how wide the spectrum of possible options were, still being considered. At one end we had Zaki and the new stadium option and at the other end Niall talking about the possibility of renewing the lease. I know things have to be kept confidential but, to me, it all seemed a bit ‘fluffy’ still.

Maybe he is taking a long term view. Sell it all to us now and its immediate money and he rides off into the sunset with £10m.
Or refuse to sell to us, we run lease down, he applies for permission to demolish, then permission to build, then find a buyer to buy the land.
Could take 10 years to get his £20m.

 

[horseman]

Can you explain this to me, as I don't get it.

Presumably you aren't thinking Kassam is going to do any of this for us? So, someone else is going to have to do it. In order to do so, they will have to buy the stadium, build the flats, refurbish the stadium and extend the conference facilities. Is that right so far?

Let's take a (very) conservative figure and say you could do that for £20m, taking into account build costs and Kassam's price for the stadium. Having had a quick look online, commercial loan rates are about 4% and you can get an 80% mortgage. So if someone put down £4m, the loan would be £16m. The interest on that would be £640,000 per year. Of course, you still have to pay off the capital amount. Let's make it easy and say whoever provides the cash is happy to get it back in 20 years. That's another £1m a year to pay back.

As income you then have the rent (or proceeds) from the flats, the rent from the rugby club (shudder), some money from the conference facilities, bits and bobs from catering and advertising and income from events in the summer (maybe a couple of large concerts?). Keeping the club separate, so money from tickets would go as at present to the club.

Let's presume that this is all set up so it is at least no worse for the club than under the current regime (if it is a worse arrangement we might as well start forming the phoenix club now!) - and we have to pay £750,000 a year to play there as now (a guess). That means the profit from the other income would have to be (£1m + £640,000 - £750,000) £890,000 just to service the debt. And that's the profit - you have to account for all the costs (business rates, taxes, staff, maintenance etc) out of the income first. And of course if you wanted to reduce/remove the charge the club has to pay, then you have to find up to another £750,000 per year of income to make it work. If you want to use some of the stadium income to fund the team in addition, that's yet more income to find. Let's say the club is given another £1m a year (which of course is laughably small in Championship terms, and just as an illustration) to bolster the team and pays no rent. That would mean the stadium would have to generate a profit of £2,640,000 per year to fund the team and service the debt.

So we are in a situation where the stadium would have to generate anywhere between £890,000 and £2,640,000 or more per year of (taxed) profit to be sustainable.

Now you can certainly argue with those figures to some degree - but I have tried to underestimate costs, while also making the maths easy! Is it likely that the stadium could generate that amount of profit per year? It seems like a hell of a lot to me. And is the fact that nobody has tried to do it an indication that it is not in fact doable?

As I said - can someone who thinks we can make this work explain to me? I must be missing something!

the football side of it is a side show/means to an end...

 

[ZeroTheHero]

the football side of it is a side show/means to an end...

For some of the potential investors that seems to be very true. Which (as far as I can work out) makes it even less likely they would be fiddling about adding bits onto a stadium on which the returns are negligible if any.

 

[LondonRoader]

Jesus Christ if I was worth £315M when I'm 65 I couldn't give a toss about a few extra mill for a football stadium I'd gladly sell it for a fiver and sail off into the sunset............

Jesus Christ if I was worth £315M when I'm 65 I couldn't give a toss about a few extra mill for a football stadium I'd gladly sell it for a fiver and sail off into the sunset............

He has a very astute daughter who can take over, people do not work to earn the money to chuck it away at the end.

 

[LondonRoader]

Can you explain this to me, as I don't get it.

Presumably you aren't thinking Kassam is going to do any of this for us? So, someone else is going to have to do it. In order to do so, they will have to buy the stadium, build the flats, refurbish the stadium and extend the conference facilities. Is that right so far?

Let's take a (very) conservative figure and say you could do that for £20m, taking into account build costs and Kassam's price for the stadium. Having had a quick look online, commercial loan rates are about 4% and you can get an 80% mortgage. So if someone put down £4m, the loan would be £16m. The interest on that would be £640,000 per year. Of course, you still have to pay off the capital amount. Let's make it easy and say whoever provides the cash is happy to get it back in 20 years. That's another £1m a year to pay back.

As income you then have the rent (or proceeds) from the flats, the rent from the rugby club (shudder), some money from the conference facilities, bits and bobs from catering and advertising and income from events in the summer (maybe a couple of large concerts?). Keeping the club separate, so money from tickets would go as at present to the club.

Let's presume that this is all set up so it is at least no worse for the club than under the current regime (if it is a worse arrangement we might as well start forming the phoenix club now!) - and we have to pay £750,000 a year to play there as now (a guess). That means the profit from the other income would have to be (£1m + £640,000 - £750,000) £890,000 just to service the debt. And that's the profit - you have to account for all the costs (business rates, taxes, staff, maintenance etc) out of the income first. And of course if you wanted to reduce/remove the charge the club has to pay, then you have to find up to another £750,000 per year of income to make it work. If you want to use some of the stadium income to fund the team in addition, that's yet more income to find. Let's say the club is given another £1m a year (which of course is laughably small in Championship terms, and just as an illustration) to bolster the team and pays no rent. That would mean the stadium would have to generate a profit of £2,640,000 per year to fund the team and service the debt.

So we are in a situation where the stadium would have to generate anywhere between £890,000 and £2,640,000 or more per year of (taxed) profit to be sustainable.

Now you can certainly argue with those figures to some degree - but I have tried to underestimate costs, while also making the maths easy! Is it likely that the stadium could generate that amount of profit per year? It seems like a hell of a lot to me. And is the fact that nobody has tried to do it an indication that it is not in fact doable?

As I said - can someone who thinks we can make this work explain to me? I must be missing something!

Yes indeed, this forum supplies all the best info.

 

[Essexyellows]

Can you explain this to me, as I don't get it.

Presumably you aren't thinking Kassam is going to do any of this for us? So, someone else is going to have to do it. In order to do so, they will have to buy the stadium, build the flats, refurbish the stadium and extend the conference facilities. Is that right so far? Yes.

Let's take a (very) conservative figure and say you could do that for £20m, taking into account build costs and Kassam's price for the stadium. Having had a quick look online, commercial loan rates are about 4% and you can get an 80% mortgage. So if someone put down £4m, the loan would be £16m. The interest on that would be £640,000 per year. Of course, you still have to pay off the capital amount. Let's make it easy and say whoever provides the cash is happy to get it back in 20 years. That's another £1m a year to pay back. Who needs a loan?

As income you then have the rent (or proceeds) from the flats, the rent from the rugby club (shudder), some money from the conference facilities, bits and bobs from catering and advertising and income from events in the summer (maybe a couple of large concerts?). Keeping the club separate, so money from tickets would go as at present to the club. Could have all of it with OUFCEvents Ltd.

Let's presume that this is all set up so it is at least no worse for the club than under the current regime (if it is a worse arrangement we might as well start forming the phoenix club now!) - and we have to pay £750,000 a year to play there as now (a guess). That means the profit from the other income would have to be (£1m + £640,000 - £750,000) £890,000 just to service the debt. And that's the profit - you have to account for all the costs (business rates, taxes, staff, maintenance etc) out of the income first. And of course if you wanted to reduce/remove the charge the club has to pay, then you have to find up to another £750,000 per year of income to make it work. If you want to use some of the stadium income to fund the team in addition, that's yet more income to find. Let's say the club is given another £1m a year (which of course is laughably small in Championship terms, and just as an illustration) to bolster the team and pays no rent. That would mean the stadium would have to generate a profit of £2,640,000 per year to fund the team and service the debt. Why would we pay rent if we own it? That money stays in the Club & Stadium "ownership". Income can also be created through player development, training ground, facilities etc.

So we are in a situation where the stadium would have to generate anywhere between £890,000 and £2,640,000 or more per year of (taxed) profit to be sustainable.

Now you can certainly argue with those figures to some degree - but I have tried to underestimate costs, while also making the maths easy! Is it likely that the stadium could generate that amount of profit per year? It seems like a hell of a lot to me. And is the fact that nobody has tried to do it an indication that it is not in fact doable?

As I said - can someone who thinks we can make this work explain to me? I must be missing something!

Keep it sensibly sustainable, self financing and it can grow gradually. Buying & building a new stadium makes us prime candidates to be the "new" Darlington. IIRC the Reynolds Arena was opened in 2003, at a cost of circa £18 million, 25,000 capacity (?). Fast forward 17 years cost of a new 25k stadium? £40 million + ................... fancy servicing 4% on that?