Selling Carrow Road?

[DOGGER 0]

We will raise £34.5m if we sell Carrow Road, resulting in paying all of our debts.

Obviously we have to pay around £1m a year in rent but surly this is a good option, thoughts?

[city-till-i-die 7]

[quote user="Dogger chasing Top 2"]

We will raise £34.5m if we sell Carrow Road, resulting in paying all of our debts.

Obviously we have to pay around £1m a year in rent but surly this is a good option, thoughts?

[/quote]NO!!!!!

[JJ 0]

No way, look at Palace for example. Im sure they dont own their ground and their in all sorts of money problems.

[Power Ranger Canary 0]

yeah a good option for 10 years then what happens?

[Congo Canary 0]

I heard this last night from the other half. To be honest,i thought it was the usual wind up on her part as i''d never herd this as an option before.

Surely it''s too bigger some for the local council to take on, so obviously a private company consortium.

Good, as say it would clear the debt and then some, plus we must be paying close to a million in interest each year, wgich would equal itself out by the ground rent, effectivly making us no worse off. BUT, this would leave us totaly at the mercy of the new company would it not?

[Power Ranger Canary 0]

yes we would be at the mercy of the company in theory but in practice what are they going to do with carrow road if they want us out, the land is worth 50p and will never be worth the same in real money terms as land prices pre credit crunch their are no other sports teams that could use it so basically we would still own it by means of the owner having no other use for a 26k stadium in norwich.

[ZLF 275]

Dont the council own poorman road?  And its helped them by...

[Ivana_rubyatitz 6]

Football seems to be immune from the normal rules of economics and business, so as long as our debt is structured in such a way as to be managable (which it seems to be and I have more faith in the new Chief Exec keeping it that way than the previous one) then why bother.  By having such a potential asset in our name we presumably make our credit rating appear better anyway.  Being in debt is not a problem, it''s being in out of control debt that destroys businesses. 

As for taking the Binners as a model of good business practice - no thanks, lets see what happens to them next season.  Their underlying debt is getting bigger, attendances down, will probably been paying Keano a bit of compensation at some point and that nice Mr Evans is not a man who will keep pouring cash down the drain for ever [;)]

[I am a Banana 0]

will we get to the prem in 10 years?? if yes then the money we get from that then we would be able to pay off our debts that way ??[;)]

[Power Ranger Canary 0]

are you willing to risk that we reach the prem in 10 years and if we dont then its bust?

[Jim Smith 2,349]

Sorry if i''m being thick but where has talk of selling Carrow Road come from?

[WeAreYellows49 0]

Im sure the current lot would sell their soul if it covered the debts.

[Karl Pilkington 0]

I think Portaloo Road is owned by the council and also there is some kind of law / bylaw which means it can only be used for sport i.e. it can''t be demolished and turned into flats. Before even considering it you''d have to do the same with CR.

Having said that I still wouldn''t. It seems too much like selling your soul.

[WeAreYellows49 0]

Exactly Karl

[Power Ranger Canary 0]

slightly off topic but if chelsea were to move away from stamford bridge they would have to change names as Chelsea F.C name is owned by the land that stamford bridge is situated on and a covenant exists not allowing for it to be moved.

[WeAreYellows49 0]

Jim it came from the news item last night

[Norma Stick 0]

I think that the OP might be on the right track, but if any of the assets were to be sold and rented back I suspect it would most likely be Colney

[Lineo 0]

God no! Are you mental?!

[Mr_Chimp 0]

[quote user="Dogger chasing Top 2"]

We will raise £34.5m if we sell Carrow Road, resulting in paying all of our debts.

Obviously we have to pay around £1m a year in rent but surly this is a good option, thoughts?

[/quote]This would be the single worst thing we could do.  The equivalent of one of those 3000% APR short term loans.  Would sort out the immediate situation by risking our future.

[canary cherub 1]

[quote user="Jim Smith"]Sorry if i''m being thick but where has talk of selling Carrow Road come from?[/quote]

Alan Bowkett said yesterday that selling the ground and leasing it back was one of the options they were looking at - either to Axa (who have loaned us money) or the local authority.  I don''t know where the figure of £34.5m comes from - it''s worth what someone is willing to pay.

Bowkett said that "other clubs" don''t own their grounds - very true, but show me one who''s prospering, or who wouldn''t snatch your hand off for a ground of their own.

A desperately short term solution to the debt problem which takes the future of the club out of our hands.  A better option than administration?? - for the shareholders perhaps, but not for the long or even medium term future of the club, something they''ve always claimed to be so concerned about.

[:@]

 

[birchfest 397]

[quote user="Jim Smith"]Sorry if i''m being thick but where has talk of selling Carrow Road come from?[/quote]Look east last night.

[Bethnal Yellow and Green 1,613]

I doubt we will go bust.We still own that wacking great big bit of land, and a large amount of the hotel which McNally has talked about selling off if times get tough. Selling the ground would just be stupid, most teams that don''t own their grounds are trying to raise enough capital so they can buy them.It is a good short term option, with rent likely to be less than interest payments on our loans but we may never be in a position to buy the ground back, and if we slip into debt again we will have to pay rent and interest payments.To be honest, what is the real difference between an £18m debt and a £23m debt? When the numbers start to get into that range it is about the management of the debt. I think is shows though that we can expect the club to be spending millions of pounds on players for while, and we will continue to try and make small profits through transfers if possible.

[Jim Smith 2,349]

Wouldn''t be the end of the world if it was sold and leased back on a long term lease with suitable protection. Are lots of top clubs who don''t own their ground and whilst ultimately its nice to be able to be proud and point to the fact that we do i would rather have a decent team in the top division!

[Power Ranger Canary 0]

yeah how much is that great chunk of land we own worth right now ;)

[tom cavendish 0]

[quote user="Power Ranger Canary"]yes we would be at the mercy of the company in theory but in practice what are they going to do with carrow road if they want us out, the land is worth 50p and will never be worth the same in real money terms as land prices pre credit crunch their are no other sports teams that could use it so basically we would still own it by means of the owner having no other use for a 26k stadium in norwich.[/quote]

Unless the purchasing company knock it down and build something else or sell it to another company. The land is in a prime location near to the railway station so it would be worth a lot of money. Bristol Rovers had to sell Eastville Stadium and the new owners sold the site to Ikea. The club then had to play at a non-league ground in Bath for many years before they got the run-down rugby stadium.

I think the club should do a deal with the council and build a big new stadium at County Hall.

[DOGGER 0]

[quote user="Jim Smith"]Sorry if i''m being thick but where has talk of selling Carrow Road come from?[/quote]

Also on the front of the EDP today

[B-ru 0]

NO! Not a good idea. I was once told that land is one of the most valuable assets to own as it is a finite resource (although there has been islands and coastlines built for vast amounts of money)

Keep hold of the stadium, the land and ride out this bubble that is the financial football nightmare. If we can hold on for another 2-5 years, we will come out the other side laughing. There are plenty of lerger clubs that will fold quicker than us. Club owners that have pumped hundreds of millions of pounds into "their club" will get bored and want their cash back.

[Yellow since 1977 0]

I work for a property company that specialises in purchase and lease back, we bought all the Aviva buildings and lease them back to Aviva on a 25 year deal.

The pros are that you can release equity in your buildings whcih you would never realise if you own them yourselves. You reduce your risk in case of any building structural failures as this would be down to the new owners. You could include life cycle replacement in the lease costs, such as boiler replacement, fire alarm, lighting etc, again reducing your risk. The contract could be so structured that the annual lease cost is pegged to the RPI whcih again reduces risk in lease hikes. You will have a partner with a vested interest you would help with stadium modifications and could build any additional seating areas and spread the cost over the rest of the contract period.

The cons are that you have all your eggs in one basket and you will not have much room for manouver in the future. You have also sold you main asset but really it isn''t worth that much to you as you would never sell it.

I know I am a bit biased but it does make quite good economic sense.

[Mr.Carrow 380]

It`s on the front page of the EDP, though i haven`t read it.  I assume that`s where the £34m figure came from?  That is alot of money and would pay back our debts with a fair bit to spare.

People panicking about it should bear two things in mind:  a., I`m sure no deal would be done unless there was a 100-year lease or "sporting activities only" arrangement and b., A £1m a year ground rent is still alot less than the £1.8m or so we pay in interest each year- and we wouldn`t have the spectre of upcoming repayments hanging over us as we did to the tune of £2.5m last season.

It`s an uncomfortable thought for sure, but just remember that a certain G.Watling having bailed the club out from Chase stated that the clubs main problem was that it was "asset-rich, but cash-poor" and unfortunately under the previous board that situation got much worse rather than better.

[Bobzilla 172]

There are only two problems with that - One, we are at the bottom of the market, and so we wouldn''t get a good price. And two, the club is then at the mercy of an outsider. This is a very very dangerous game, and you need a very very good lawyer to make this work - the contract has to be watertight. Plus you need an investor who wants to do the deal.

I wouldn''t recommend it in anything other than the most dire circumstances.