Sell The Ground - Good Idea

[Capt_Canary 0]

Its time we address the debt issue with immediate effect. We are paying over £1m a year on the loans in interest alone. If we sell Carrow Road we can get around £35m which will pay off the £23m debt and then we still have £12m in reserve which can go towards long-term team strengthening. Ok we have to  lease the ground back and pay £1m a year but surely that makes sense. There can possibly be a provision in there where we can buy the ground back in the next 10 years at a cost of £40m or something and 7 years on they will have made £12m profit if we buy then with the £1m in interest and £5m in profit on the ground.

[First Wizard 0]

Plus it should remove a few obsticales in getting rid of the cook.........no more 56 million buy out cack from her!

[can u sit down please 0]

I actually agree. Football is changing and we need to change with it if we are to be competitive again. Many clubs dont own there ground. How will it  damage our identity?If it wipes out the debt and encourages new investment, them im all for it. I did read on here that we would be 1 of 3 teams in the country that are in the black! That would be brilliant!This debt is crippling us. Lets cripple the debt before its too late.

[CaptnCanary 0]

It would be a terrible long term strategy. In 35 years we would have paid back the purchase price and still be coughing up £1m a year in rent. Selling the stadium should be an utterly last resort.

[Mister Chops 7]

I really think this needs thinking through, it''s not just about numbers. Not to me, anyway, It''s about part of the soul of the club.  All the "new build" stadiums these days are outside the ring road, away from the city or town, often as part of a faceless retail centre which has zero local character and could be anywhere at all in the UK.  Reading, Bolton, MK Dons are just three I can think of.  Perhaps selfishly but I love our ground, I love the cycle ride to the ground across the Millenium Bridge and mingling with the crowds all heading to the match.  If our ground was out near the Showground (for example), it would be a modern, concrete, soulless and bland place which would lack character.As for selling what you own and then paying money each month to borrow it back - that''s the Cash Converters model of business.  Cash Converters aren''t broke, but the people who go there are.  There must be a better way than selling off the family silver.

[Yellowbeagle 0]

[quote user="CaptnCanary"]It would be a terrible long term strategy. In 35 years we would have paid back the purchase price and still be coughing up £1m a year in rent. Selling the stadium should be an utterly last resort.[/quote]

I agree totally, it''s the one asset that sets us apart i''d rather we sold off the players and started building from scratch again, the stadium will be still be the clubs long after the current team is gone and also during those 35 years theres bound to be other problems arising, i mean whats stopping us getting into the same mess again, this time minus the asset of the stadium should we need to negotiate a new bank loan like most businesses need to do from time to time. Also i doubt if the banks or whoever buys the stadium will still only want £1million a year in even ten years time with the affects of inflation.

[canary cherub 1]

Even if it was just a numbers game, the numbers don''t add up.  Firstly, the asset value (currently c.£35m) is not the same as the market value, which is whatever someone is willing to pay.  Right now I doubt if we''d get enough to clear the debt, let alone have any left over to invest in the team.  And where do we get the money to buy it back?  Borrow it, using the ground as security? . . . oh, wait a minute . . . [:$]

This isn''t the shape of things to come, it''s a last resort to avoid administration.  No club in their right mind would sell their ground if they didn''t have to (before you mention Manchester City, they got a brand new 40,000 stadium thrown in for nothing).  Those who would benefit the most would be the shareholders, because administration would wipe out the share value but selling the ground wouldn''t.  I don''t see why we should lose the ground in order to bail out the very people who got us into this mess in the first place.

 

[Shyster 0]

[quote user="Mister Chops"]I really think this needs thinking through, it''s not just about numbers. Not to me, anyway, It''s about part of the soul of the club.  All the "new build" stadiums these days are outside the ring road, away from the city or town, often as part of a faceless retail centre which has zero local character and could be anywhere at all in the UK.  Reading, Bolton, MK Dons are just three I can think of.  Perhaps selfishly but I love our ground, I love the cycle ride to the ground across the Millenium Bridge and mingling with the crowds all heading to the match.  If our ground was out near the Showground (for example), it would be a modern, concrete, soulless and bland place which would lack character.As for selling what you own and then paying money each month to borrow it back - that''s the Cash Converters model of business.  Cash Converters aren''t broke, but the people who go there are.  There must be a better way than selling off the family silver.[/quote]

I remember my grandfather having similar sentiments about The Nest.

[First Wizard 0]

[quote user="Mister Chops"]I really think this needs thinking through, it''s not just about numbers. Not to me, anyway, It''s about part of the soul of the club.  All the "new build" stadiums these days are outside the ring road, away from the city or town, often as part of a faceless retail centre which has zero local character and could be anywhere at all in the UK.  Reading, Bolton, MK Dons are just three I can think of.  Perhaps selfishly but I love our ground, I love the cycle ride to the ground across the Millenium Bridge and mingling with the crowds all heading to the match.  If our ground was out near the Showground (for example), it would be a modern, concrete, soulless and bland place which would lack character.

As for selling what you own and then paying money each month to borrow it back - that''s the Cash Converters model of business.  Cash Converters aren''t broke, but the people who go there are.  There must be a better way than selling off the family silver.

[/quote]

Seriously Mr C, we still refer to the N&P as the river end, yes? Carrow Road would remain longer in our hearts than the AXA.com stadium as well!

And we''d be debt free too!

[Mister Chops 7]

[quote user="Shyster"][quote user="Mister Chops"]I really think this needs thinking through, it''s not just about numbers. Not to me, anyway, It''s about part of the soul of the club.  All the "new build" stadiums these days are outside the ring road, away from the city or town, often as part of a faceless retail centre which has zero local character and could be anywhere at all in the UK.  Reading, Bolton, MK Dons are just three I can think of.  Perhaps selfishly but I love our ground, I love the cycle ride to the ground across the Millenium Bridge and mingling with the crowds all heading to the match.  If our ground was out near the Showground (for example), it would be a modern, concrete, soulless and bland place which would lack character.As for selling what you own and then paying money each month to borrow it back - that''s the Cash Converters model of business.  Cash Converters aren''t broke, but the people who go there are.  There must be a better way than selling off the family silver.[/quote]

I remember my grandfather having similar sentiments about The Nest.[/quote]But we moved from the Nest out of choice and concern over capacity, not because we were impoverished and selling off our ground was the only feasible solution.  I.e. that move was a step forwards, and this one would be a step backwards, even if we stay there on a "leasehold" basis.

[Wandsworth Canary 0]

We may sell for £35M, and as mentioned clear the debt and have £12M. The problem is at present we pay £1.6M in debt interest and lose £3M to £5M a year, if we replace the £1.6M interest with £1M ground rent we are still losing money each year. 10 years down the line we could in theory have lost another £25M to £35M, spent the proceeds, be back in debt again and have no major asset as security or have the ability to buy our ground back. Before we sell off the crown jewels, we need to get the yearly finances back in order. As tough as they may be in reduced running costs it is the only sensible long-term plan. Once we are on an even ground we can then look to service the debt better. Selling the ground, players or magic new investment are one off usually short term fixes. As a one off revenue stream I would rather sell the naming rights (equally controversial) year-on-year than the whole ground.

[Lambert is King 0]

Surely there is one difference in Doncaster seems to have destroyed this club, I trust somehow that Mcnally will over the years sort out these problems. I beleive that when he makes decisions it is purely in the interest of NCFC. We need to give him time to put things right but he probably needs promotion this year to move things forward.

I am conviced that any decision he makes is purely for the benefit of our club and he would have stood up and been counted in previous years, he would not have just gone along with the flow. Lets faceit if it means selling the ground or going into administration he will make the right decision. In administration dont forget all our assests will be sold cheap ,ground first followed by the players. We will then have no control

[The gut 0]

I know my preferred choice is far too simple (very basic but scope for discussion), with many many complications to be overcome, but I really do believe that it could be done. Even organised and financed by the club.

The club sells the land to the supporters for £25,000,000.

50,000 thousand shares offered at £500 per share. (offered 1st to share holders and season ticket holders both 1 per person, then general sale. These could be traded but at no time could 1 person own more than 100 shares, ensuring that at least 500 shareholders were in control of the land). 

Everything on the land and any associated administration and costs would be the responsibility of the club.

Ground rent set at £200,000 per year payable by the club to a shareholders fund for possible future admin costs.

The club would be free of debt, free to build on the land or move at any time.

I keep thinking I must have made a very basic even stupid error in these calculations and suggestions but I''m sure I''ll soon be told. I can handle that though after all it''s just another discussion topic.

 

 

 

 

 

 

[Rudolph Hucker 0]

Gut, this is a radical idea about self help and we need these. I think the Club needs to explore these because optimism is in the air and success is worth backing.

[The gut 0]

[quote user="RUDOLPH HUCKER"]Gut, this is a radical idea about self help and we need these. I think the Club needs to explore these because optimism is in the air and success is worth backing.[/quote]

Phew, at least one positive comment.

[Steak&Ale 0]

Hi Gut, I think this is a reasonable idea. How good would we all feel being able to secure a decent future for Ncfc. How would our better players feel if they were offered a slightly improved position elsewhere? Imagine the publicity, and more importantly, perhaps, the impression it could give a potential investor? The big Q is... How many of the fans will dig deep to find £500?

[The gut 0]

I''m always skint but I would definitely find 500 quid to actually own a share of the land so it is in the hands of the fans. Obviously there would be many who couldn''t do it but there will also be many who could buy several. They should also always have a resale value. If the club stayed at Carrow Rd it could maybe buy it back, or if it did ever decided to move to a new ground the land could be sold to either help the move or paid to the shareholders of the land?

[Binky 0]

[quote user="The gut"]

I know my preferred choice is far too simple (very basic but scope for discussion), with many many complications to be overcome, but I really do believe that it could be done. Even organised and financed by the club.

The club sells the land to the supporters for £25,000,000.

50,000 thousand shares offered at £500 per share. (offered 1st to share holders and season ticket holders both 1 per person, then general sale.

Ground rent set at £200,000 per year payable by the club to a shareholders fund for possible future admin costs.

The club would be free of debt, free to build on the land or move at any time.

I keep thinking I must have made a very basic even stupid error in these calculations and suggestions but I''m sure I''ll soon be told. I can handle that though after all it''s just another discussion topic.

 [/quote]

Gut - nice idea but... Your model assumes there are 50,000 fans who would pay, on average £500 each. I know some fans could pay perhaps thousands or even tens of thousands - but many would struggle to offer £50. £25million is a big sum by any standards. Bear in mind there are a lot of children or concessions amongst our gates of 25,000. Think of those 25,000 at the ground yesterday and how much could each fan afford to cough up on average do you think? And £200,000 pa rent represents a return of just 0.8% pa. There is already a long thread on this topic, see:  http://www.pinkun.com/cs_pinkun/cs/forums/4/1950567/ShowPost.aspx#1950567What you are proposing I think is tantamount to a straight bond issue - albeit secured on the ground itself.

[The gut 0]

Binky, it''s not really a model, just a bit of not really thought through chat in line with the thread title. All I know is what I would do, and I''d probably get two shares. Doesn''t just have to be fans though, local businesses could also buy. The rent idea wasn''t meant to be an income, just a safeguard thrown in which would be cheap for the club, it could even be zero rent. Don''t profess to know anything about bonds, but I saw it as buying a share in land mainly for the benefit of the football club. I don''t know what is possible, but the club could do a bit of research easily and find out. Some things can be kept simple. If the club was going under and had to lose the ground (not suggesting this) I wonder what people would pay to save it. For me it would be about the same. It would also mean that if the fans owned the land it would be more difficult for the clubs owners to secure further debts.

[The Fish Seller 0]

From The Times january 8 2010The Newcastle United Supporters Trust have received a startling response to their attempts to buy a substantive stake in the Coca Cola Championship club, with fans to date pledging well in excess of £50m in support of the bid.The Times understands that more 6000 fans have responded to the ‘Yes We Can’ campaign with offers of financial backing, with around 4000 prepared to fund a minimum of £1500 and another 2000 signalling their willingness to invest £25,000 from their pension funds.While no money has yet been collected and the NUST’s financial advisors have cautioned that up to half of the pledges may not be followed through, the figures still represent a strong desire on behalf of fans to have a say in the future running of Newcastle, which is presently owned by Mike Ashley, the sportswear retailer.The NUST also claim to have significant backing from wealthy individuals and North East-based businesses, details of which they will announce in the coming weeks.Related Links

With Chris Hughton’s players responding to the off-field difficulties of last summer by opening up a six-point lead at the top of the division, supporters have responded in an equally positive manner. Ashley’s three-year tenure at St James’ Park has brought five managers, relegation, numerous controversies and two failed attempts to sell-up.“The take-up has been astounding and demonstrates fans have the appetite to back the ‘Yes We Can’ campaign,” a source close to the NUST said last night. “It also shows that fans are still sceptical about the intentions of the present owners and see an alternative as preferable to the uncertainty that surrounds investment plans for the future.”Newcastle City Council are to consider a cross-party motion offering their support to the NUST. “This is not intended as a pop at the current owners,” John Shipley, the council leader, said. “It’s saying we feel frustration at the events of the last decade and all the shenanigans of managers and owners, which we feel has had an effect on the reputation of the club and a rub-off on the reputation of the city.”

[The gut 0]

Interesting, Buckethead.

Nexus might also be interested what paper you got that from.