Is it clear what the terms of these valuations floated in the press were? I don't think so.
But they didn't value the freehold at £4m did they? Wasn't that their value of the 'business' i.e. ACL?
Beat me to it - had just started playing with some yield and revenue assumptions in Excel. I also assumed 7% yield, although that may be a little high. I assumed total income of 2mm giving a valuation of 28.5mm.
To answer magic82ball, it is the income potential that should be used. The fact that SISU withheld their rent is not relevant. I reckon that properly managed, one should be able to get 2mm pa revenues from the Ricoh (Casino, special events, catering etc.)
20-30 year gilts trading at 3.5%, so I reckon 7% is a bit high. 6% yield assumption gives a valuation of 33mm - again on projected revenue of 2mm.
2.5mm revenue and 6% yield gives you 42mm valuation.
20-30 year gilts trading at 3.5%, so I reckon 7% is a bit high. 6% yield assumption gives a valuation of 33mm - again on projected revenue of 2mm.
2.5mm revenue and 6% yield gives you 42mm valuation.
I think people are getting mixed up between the Lease and the Freehold.
The Ricoh stadium with freehold would be in the region of £40M and as a whole £60M-£70M with the rest of the complex. IMHO
In addition I don't think they want to sell.
glad you appreciate the logic, but your idea of revenue is way wide of the mark
if we base it on ACL's last offer of £100k pa for the two years after an initial "free" year
£100k/.07 = £1.5m capital value
There has been a lot of speculation about how much SISU wouldn't pay
but I think they would be prepared to pay in excess of the £1.5m I just calculated.
bearing in mind the running cost of the asset is likely to be in excess of £1.5m pa
I think it is just a matter of time before the council come round to seeing it as in their best interests to deal as soon as possible!
Didn't Tim Fisher recently say they would buy the freehold, and it would be up to CCC to "liquidate" ACL? I seriously doubt that it would happen.
glad you appreciate the logic, but your idea of revenue is way wide of the mark
if we base it on ACL's last offer of £100k pa for the two years after an initial "free" year
£100k/.07 = £1.5m capital value
What is a mm in this context, I always though it was a millimetre?
millions. m is a thousand, so mm is 1000x1000 = 1,000,000
If I we're the council
I would say that the club have to move back to the Ricoh immediately.
Then a date at the end of the season to be agreed.
Two completely independent valuations obtained.
Then a price in middle shaken on.
I see your point, aside the last line.....
My point is SISU have engineered the club moving out = lower valuation of Ricoh.
Buy Ricoh + move the club back in = instant profit.
Demand the club come straight back, we the fans get our club back.
SISU are not rewarded for using the club as a hostage.
A correct price is paid for the stadia and no one can moan about tax payers getting ripped off. Or there is another JR as the council sell the Ricoh cheap to help out a private company etc etc etc
Blimey, remind me not to get you in as a valuation agent.
I hate to shoot you down here, but you're just using ACL's figures based on the revenue you think they may receive from the club. ACL themselves claim a lot more than that as revenue, and show more both in their past books and presumably their future projections.
Even then, if you're just going to use ACL revenue as a valuation for the freehold, then you only get the freehold for the bit that ACL sit in. All of that other land, ready for development, and the casino etc., that's not included in your valuation by definition. How much are you going to value that at?
And that's before you even get to the question of whether the council want to sell at the 'bottom of the cycle', to use Tim's words. SISU wouldn't, so why should CCC? It could be that if ACL is profitable, there's no commercial need to sell at all, in which case a buyer might need to go far beyond a simple commercial valuation in order to secure a purchase. In addition the council have a statutory legal duty to get the best possible return for any assets they sell, so even if they wanted to do a deal, they'd be obliged to consider all avenues before selling to SISU.
As I've said before, if you want to know the true market value of something, the best thing to do is put it on the market.
(As an aside, even if you buy the freehold, you still get ACL as a sitting tenant with a 40+ year lease. You can't just break that lease, no matter what TF says. And the Council, even if they wanted to, do not have the power to 'liquidate' ACL. The only quick way back to the Ricoh, imho, is via a rental deal. Anything else is going to take a long time to sort out.)
I see your point, aside the last line.....
My point is SISU have engineered the club moving out = lower valuation of Ricoh.
Buy Ricoh + move the club back in = instant profit.
Demand the club come straight back, we the fans get our club back.
SISU are not rewarded for using the club as a hostage.
A correct price is paid for the stadia and no one can moan about tax payers getting ripped off. Or there is another JR as the council sell the Ricoh cheap to help out a private company etc etc etc
You could be right on ACL being part of the reason why CCC don't just do the deal. They do have a lease in place for the next 40 years. Having said that the council created ACL who used to be 50/50 council and CCFC, Higgs bought out the CCFC interest when CCFC had "cash flow" problems.
I would have expected the council to retain a controlling interest and if so they could disolve ACL if they so wished, and certainly SISU will not do any deal with ACL still in place.
The problem might be funding the withdrawal of the Higgs Trust.
I believe they paid c £6m when they got involved that probably has a lesser book value now after 8 or 9 years but they would want it back.
If the value is based on the rental value of £100k or £150k there wouldn't be sufficient cash to refund them.
It becomes very difficult to establish a value other than for CCFC playing there, clearly Vile or KP wouldn't want to! Rugby teams don;t generate the same revenue!
Maybe SISU would be prepared to pay a value based on the rent originally agreed for the Premier League - £1.3M /0.07 =£18.5M its potentially worth that in the long term to them and arguably preferably to them building another stadium as they plan.
It needs some sorting out but the council don't seem to even get started!
How can ccfc moving out of the Ricoh decrease it's value, when ACL are financially better off without the club there?
Sent from my iPhone using Tapatalk - so please excuse any spelling or grammar errors
Ann Lucas stated that we the Council DO NOT SELL FREEHOLD's. That makes this thread a waste of time.
mm is millimeter, it's certainly not million .
On talksport last week, there was a discussion about an NFL team looking to set up in the UK, and although London was mentioned as the prime location, maybe a stadium elsewhere may be an option? I wonder how much the Ricoh would be worth then?
Oh, the team mentioned was the Jacksonville jaguars......
Is /Was that the Team that PH4's old man was part owner of?? Read an article recently on this ,Wembley too Big ,Myriad other sites In around the Capitol though.
You could be right on ACL being part of the reason why CCC don't just do the deal. They do have a lease in place for the next 40 years. Having said that the council created ACL who used to be 50/50 council and CCFC, Higgs bought out the CCFC interest when CCFC had "cash flow" problems.
I would have expected the council to retain a controlling interest and if so they could disolve ACL if they so wished, and certainly SISU will not do any deal with ACL still in place.
The problem might be funding the withdrawal of the Higgs Trust.
I believe they paid c £6m when they got involved that probably has a lesser book value now after 8 or 9 years but they would want it back.
If the value is based on the rental value of £100k or £150k there wouldn't be sufficient cash to refund them.
It becomes very difficult to establish a value other than for CCFC playing there, clearly Vile or KP wouldn't want to! Rugby teams don;t generate the same revenue!
Maybe SISU would be prepared to pay a value based on the rent originally agreed for the Premier League - £1.3M /0.07 =£18.5M its potentially worth that in the long term to them and arguably preferably to them building another stadium as they plan.
It needs some sorting out but the council don't seem to even get started!
m is thousandth (milli) - 0.001
k is thousand - 1000
M is million (mega) - 1,000,000
mm is millimeter, it's certainly not million despite the fact that a millenium is 1000 years.
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