Potential New Ground

[Left Wing Cross]

Not paying rent will have an opportunity cost for the investor (at the least loss of return on investing the money involved elsewhere) or the club/investor would have to repay debt for buying the stadium.

While there would be no rent, some of this would be offset by new running costs/maintenance.

 

[Victor1986]

Precisely Manorlounger. These sort of things (including, by the way,which players we are after!) need to be kept seriously under wraps until there is something to say. Glad to see you have still got belief in our existing ground Essexyellows!

 

[horseman]

I just don't see how the League structure as we currently know it can survive much longer and anyone deciding to prop up a club outside of the Prem or Championship will not be doing so for the love of the club involved.

At the moment the bigger clubs chase the champions league money, the championship clubs chase the prem money and when the European League get's the go ahead (and it's not faraway) the gulf will be even bigger..The tv companies BT and Sky will go after the European League and it's very unlikely any of the other broadcasters will be interested in Newcastle v Watford Palace v West Ham etc etc

The clubs lower down wont be worth a pot to P**s in to any potential owner and i suspect many will end up like Bury etc.

Other than for the value of property, who in their right mind would even consider throwing millions at a lower league team knowing the above is not far away.

 

[ZeroTheHero]

1. Not paying rent.
2. Club & Ground are one (resale value).
3. Income from all the stuff we don`t currently get income from.
4. Increase in income from those who don`t spend money at the ground.
5. Probably some tax efficiency in there as well.
6. Fourth stand (temporary or otherwise).
7. Increased income from 6.
8. Potential from Events/Groundshare etc.
9. Flat`s in the corners. Rental or sale income.
10. The long "lost" East Stand supporters club.

Just off the top of my head.

1. That's the club saving money. If we don't pay rent, that is £600,000 (or whatever) LESS that goes towards paying of the cost of the stadium ie nothing from the playing side.
2. Hopefully. But unless you sell there is no actual money going back to the investors is the whole lot worth £13m to anyone else? Maybe if we were in the championship?
3. Yes, like the conference facilities and perimeter advertising for example. I agree that there is some payback there.
4. Probably - but that is a hell of a lot of pies!
5. Possibly, I am not a tax expert.
6. Umm - that is a COST. You have to build the thing and then hope that an increase in attendances covers that cost. Any money after that would be a plus of course.
7. As above
8. Events - maybe. Groundshare - with a rugby club perhaps? That worked out well last time! Possibly a source of income if anyone wants to do it.
9. Again a COST to build. I don't know how many people want to live on the corner of a football ground out of the town centre in a car park next to the Leys. I am guessing they wouldn't be premium properties but yes a potential income stream AFTER the cost was paid for.
10. Pubs don't make money. Even less, out of town ones that are busy for a few hours 30 days a year.

Let's say a commercial loan interest of 3%. On £13 million that is £390,000 per annum. So we would have to make that amount from the club, catering, conference facilities etc (minus the maintenance of course) to pay just the interest. If the investors were happy to be paid back over 25 years (we wish!) that would add £520,000 per year. Making a total of £910,000. That is without paying for a fourth stand and/or flats.

I don't think I have been overly pessimistic with any of these (completely and totally guessed!) numbers. And I still cannot see how the club/stadium will generate the best part of a million quid a year PROFIT (without any rent from the club). Now obviously this is all predicated on the 'investors' being hard nosed property developers (which I think they are) rather than football philanthropists/enthusiasts who want to invest that sort of money as a bit of 'train-set' fun. If it's the latter (or one of us wins the Euromillions) it's a different story of course.

 

[Foley]

I just don't see how the League structure as we currently know it can survive much longer and anyone deciding to prop up a club outside of the Prem or Championship will not be doing so for the love of the club involved.

At the moment the bigger clubs chase the champions league money, the championship clubs chase the prem money and when the European League get's the go ahead (and it's not faraway) the gulf will be even bigger..The tv companies BT and Sky will go after the European League and it's very unlikely any of the other broadcasters will be interested in Newcastle v Watford Palace v West Ham etc etc

The clubs lower down wont be worth a pot to P**s in to any potential owner and i suspect many will end up like Bury etc.

Other than for the value of property, who in their right mind would even consider throwing millions at a lower league team knowing the above is not far away.

I agree with some if that but reckon it isnt wiite that simple.
Even if 'the big 6' went to a new European league, Everton, West Ham, Leeds, Newcastle, Wolves, Villa and a whole load of big clubs will still be in an English League.
I am sure that with millions in England 'supporting' English teams , the TV will still be very interested in covering this (agree not the £100's millions as now)

 

[Foley]

1. That's the club saving money. If we don't pay rent, that is £600,000 (or whatever) LESS that goes towards paying of the cost of the stadium ie nothing from the playing side.
2. Hopefully. But unless you sell there is no actual money going back to the investors is the whole lot worth £13m to anyone else? Maybe if we were in the championship?
3. Yes, like the conference facilities and perimeter advertising for example. I agree that there is some payback there.
4. Probably - but that is a hell of a lot of pies!
5. Possibly, I am not a tax expert.
6. Umm - that is a COST. You have to build the thing and then hope that an increase in attendances covers that cost. Any money after that would be a plus of course.
7. As above
8. Events - maybe. Groundshare - with a rugby club perhaps? That worked out well last time! Possibly a source of income if anyone wants to do it.
9. Again a COST to build. I don't know how many people want to live on the corner of a football ground out of the town centre in a car park next to the Leys. I am guessing they wouldn't be premium properties but yes a potential income stream AFTER the cost was paid for.
10. Pubs don't make money. Even less, out of town ones that are busy for a few hours 30 days a year.

Let's say a commercial loan interest of 3%. On £13 million that is £390,000 per annum. So we would have to make that amount from the club, catering, conference facilities etc (minus the maintenance of course) to pay just the interest. If the investors were happy to be paid back over 25 years (we wish!) that would add £520,000 per year. Making a total of £910,000. That is without paying for a fourth stand and/or flats.

I don't think I have been overly pessimistic with any of these (completely and totally guessed!) numbers. And I still cannot see how the club/stadium will generate the best part of a million quid a year PROFIT (without any rent from the club). Now obviously this is all predicated on the 'investors' being hard nosed property developers (which I think they are) rather than football philanthropists/enthusiasts who want to invest that sort of money as a bit of 'train-set' fun. If it's the latter (or one of us wins the Euromillions) it's a different story of course.

I think that you have looked at some downsides there.
If the club owned the Conference centre by the way, it could be used an awful lot more ( with all of the businesses that support the club)
Regarding other events, the Elton John concert had 18,000 people there I believe. Is there a reason there have been none since?
You say pubs lose money. I believe that the old supporters club at the Manor used to pay profits over to the club?
I am sure that there are other potential revenue streams.
Maybe the Council would be able to contribute on.the basis that it is used for the Community ( I believe there was even talk of classrooms under the East stand at one stage?)

 

[OX18]

The supporter’s club at the Manor did make a profit for the club. The problem is that in those days we all (not me though ?) used to think nothing of driving up there at night for a few pints. Being slap in the middle of Headington it was used as a pub, meaning trade on non match days was pretty vibrant. The slot machines were always busy. Nowadays, evening drinking habits have changed, I’m not sure that there are many clubs with a supporter’s club that are viable.

 

[Manorlounger]

Some very laudable ideas but, the problem will always be that the Kass Stad is just not fit for purpose. It is old, poorly maintained, poorly equipped in terms of anything other than football (and some would say even that is debatable) and badly situated at the wrong edge of the city.
It is in simple terms, a money pit. The land underneath is the value, not the stadium.

 

[AbbeyOx]

put a micro brewery in there - seems popular now. could even have a home brew!

 

[Foley]

I think that Walsalls and even Wycombe's do Ok.
Things would be different from the old supporters club.
Wycombe seem to have loads of events/ sportsmans dinners etc.
If big enough it could do a huge trade in big games.

 

[horseman]

I agree with some if that but reckon it isnt wiite that simple.
Even if 'the big 6' went to a new European league, Everton, West Ham, Leeds, Newcastle, Wolves, Villa and a whole load of big clubs will still be in an English League.
I am sure that with millions in England 'supporting' English teams , the TV will still be very interested in covering this (agree not the £100's millions as now)

They would only be big clubs in the eyes of their own fans at that point (a European League) Think of the bigger picture do you think those "Elite" clubs will allow entry into a European League and how could it work, let's say AC Milan were bottom where would they drop to and who replaces them and how?

When cup draws are made currently where do the tv companies go Watford? Palace? they go to the Top 6/8 in nearly every case

I can see clubs having their own channel for games (like follow now) but doubt the tv companies would try compete

 

[Manorlounger]

I was just reminded of our trip up to St.James. 52,000 seater stadium right by the city centre, got it's own Metro station, multi storey car park, supporters club with bar, club offices, shop and ticket offices. Hotels nearby, loads of conference suites, exhibition areas.
Now, if we could get a bit of land from one of the colleges, right in town!

 

[Left Wing Cross]

The supporter’s club at the Manor did make a profit for the club. The problem is that in those days we all (not me though ?) used to think nothing of driving up there at night for a few pints. Being slap in the middle of Headington it was used as a pub, meaning trade on non match days was pretty vibrant. The slot machines were always busy. Nowadays, evening drinking habits have changed, I’m not sure that there are many clubs with a supporter’s club that are viable.

Given there is little in the way of "pubs" in Greater Leys, perhaps using it out of matchdays isn't such a bad idea

 

[DavidB]

Oxit, surely?

Think we should have a vote to decide

 

[ZeroTheHero]

I think that you have looked at some downsides there.
If the club owned the Conference centre by the way, it could be used an awful lot more ( with all of the businesses that support the club)
Regarding other events, the Elton John concert had 18,000 people there I believe. Is there a reason there have been none since?
You say pubs lose money. I believe that the old supporters club at the Manor used to pay profits over to the club?
I am sure that there are other potential revenue streams.
Maybe the Council would be able to contribute on.the basis that it is used for the Community ( I believe there was even talk of classrooms under the East stand at one stage?)

You maybe right in that I am looking at some of the downsides - I was trying to look at it more from the point of view of an investor than an OUFC supporter!
I do agree that the Conference center would probably be used more - but I have no idea on how much it is used currently and how much extra can be profited (rather than charged) for its use. From the website, it looks as if you can hire a box for £120 a day, weddings are from £3,200 catered (let's say you did two weddings a week. You'd bring in approx £300,000 - but that's not profit. Maybe half of that?)
Re the concerts - I can't help thinking that if Firoka had made a huge profit, there would have been more concerts there?
Yes, pubs lose money - there are pubs closing down every day. The old supporters club was in a different era (drink driving, smoking, drinking at home and in a very different place).
But let's say I am wrong (it has been known once or twice!). If it was as 'simple' as buying the stadium for £13 million quid (nominally) and you could make a million quid profit a year without the rent from the club - why has nobody done it yet? There are people much cleverer and more financially astute than me who would leap at that - an asset that pays for itself in a relatively short timescale and then gives you a million quid profit a year would be a brilliant investment.

 

[yellowbow]

There doesn't have to be any public announcement from the club anytime soon. If I was in their shoes I would be saying nothing until the deal was done. Contracts signed, finance in place and all parties involved ready to sing from one song sheet.
Business transactions are not conducted with an audience and an eye to audience reaction.

I suppose in a way that was the point I was trying to make though. It’s difficult to keep the faith that things are progressing behind the scenes when, after two years, the club itself is denying it and doing a great job of keeping everything under wraps/doing a great act of having no coherent plan.

 

[OX18]

Given there is little in the way of "pubs" in Greater Leys, perhaps using it out of matchdays isn't such a bad idea

Surely that was the problem with The Priory, locals didn’t use it.

 

[Sheik djibouti]

It goes without saying (but I'll say it anyway). Major developments are tricky to pull off at the best of times and they take a hell of a long time to come to fruition from inception to delivery. Major retail and leisure developments involving first class sports arena are exponentially more difficult to pull off. Major retail and leisure developments involving first class sporting in and around Oxford are more difficult to pull off still. Trying to attempt all that in uncertain times when investment return is potentially very weak* might just make the prospects of success too vanishingly small for all but the most hard-nosed, deep pocketed investors to stomach...

*where is shop-based retail heading?, how much leisure capacity is there in the area? - restaurants and pubs are closing all the time. What is the USP? Bicester Village already have the "high end" sown up? How likely is investment in public/community assets as part of the sweetener to get the project past the planning authorities?

 

[LondonRoader]

I'm not sure of the exact figures but will be put right.

From memory the figures we pay FK approx £300k rent and £300k service charge plus vat on both.

Now the saving of not paying the rent is £360k, but we still have to pay a service charge whatever ground we played at.

 

[Essexyellows]

I'm not sure of the exact figures but will be put right.

From memory the figures we pay FK approx £300k rent and £300k service charge plus vat on both.

Now the saving of not paying the rent is £360k, but we still have to pay a service charge whatever ground we played at.

Why would you pay a service charge on something the club own?
Bingo, another £300k saved....