New Stadium Progress

[jlove]

Surely the bigger factor will be how the sales of GWQ properties are going? Barratt Homes is stating that 75% of phase 1 of the development is sold; if this specific development sells well, then they have more reason to develop further around the site.

 

[JBN]

Surely the bigger factor will be how the sales of GWQ properties are going? Barratt Homes is stating that 75% of phase 1 of the development is sold; if this specific development sells well, then they have more reason to develop further around the site.

For publicity purposes, developers put 'sold' up before the thing is completed.

In the case of GWC, it may be that they have 75% under offer, with deposits paid but not completed. They won't complete the sales and get the cash in until the units are finished. The buyers are on the hook, but the full purchase prices have not been paid. Barratts and many others are offering big incentives to buyers, which will hit their margins.

If there are delays in completing the units, then the buyers should have an opt out clause and that could well leave Barratts up the creek with no paddles.

 

[JBN]

If Barratts don't deliver, does the option pass back to BFC?

If so, why doesn't BFC do the development?

I know it sounds a slightly bonkers idea, but, if BFC use GP as collateral to secure funding. It could work.

BFC get the whole master plan in place and build out all the residential and either sell it which would bring in capital or rent it out, which would provide an income stream.

It would also mean that any developers profit built into the financial appraisals would come back to BFC, not in cash, but in discount (as a guide, this can be about a third of the completed development value).

All we would need is a very good proffessional team and a very very good project manager.

I have recently met a residential developer who is still building and looking to rent out some 300 units in his development because that is where the demand is.

 

[VTG]

If Barratts don't deliver, does the option pass back to BFC?

If so, why doesn't BFC do the development?

I know it sounds a slightly bonkers idea, but, if BFC use GP as collateral to secure funding. It could work.

BFC get the whole master plan in place and build out all the residential and either sell it which would bring in capital or rent it out, which would provide an income stream.

It would also mean that any developers profit built into the financial appraisals would come back to BFC, not in cash, but in discount (as a guide, this can be about a third of the completed development value).

All we would need is a very good proffessional team and a very very good project manager.

I have recently met a residential developer who is still building and looking to rent out some 300 units in his development because that is where the demand is.

What on earth are you on about?

 

[JBN]

What on earth are you on about?

We take the option back from Barratts, agree what is going in the master plan with Hounslow Council and then build everything, lock stock and barrel, including the residential elements.

BFC then have total control. As far as the flats are concerned, they can sell them or rent them taking the capital or creating an income stream.

The development will be phased, the first phase can be forward funded using Griffin Park as collateral, the rest can be built from the income stream created from phase 1.

Dead simple

 

[Owlsmoor_Bee]

We take the option back from Barratts, agree what is going in the master plan with Hounslow Council and then build everything, lock stock and barrel, including the residential elements.

BFC then have total control. As far as the flats are concerned, they can sell them or rent them taking the capital or creating an income stream.

The development will be phased, the first phase can be forward funded using Griffin Park as collateral, the rest can be built from the income stream created from phase 1.

Dead simple

All other factors aside & assuming it was even a possibility, why would the club want to leave itself open to the high risk that comes with speculative development, especially in a housing climate which is tough to say the least ?

 

[rebus]

We take the option back from Barratts, agree what is going in the master plan with Hounslow Council and then build everything, lock stock and barrel, including the residential elements.

BFC then have total control. As far as the flats are concerned, they can sell them or rent them taking the capital or creating an income stream.

The development will be phased, the first phase can be forward funded using Griffin Park as collateral, the rest can be built from the income stream created from phase 1.

Dead simple

If only it was that easy. Lionel Road cannot be built without the help of a development partner.

 

[JBN]

All other factors aside & assuming it was even a possibility, why would the club want to leave itself open to the high risk that comes with speculative development, especially in a housing climate which is tough to say the least ?

The rental market is bouyant though.

If the residential element is phased in 3 or 4 hits, BFC could build out phase 1 and have a buy or rent marketing campaign.

If there are more renters than buyers, BFC get an income stream, those that buy, provide the capital to build, those that rent also provide capital, but at a different level and the funding repayments can be adjusted to take account of this.

If it is programmed right and managed/marketed correctly, it could be a big big winner.

Yes it means that BFC take all the risk, but if the housing slump is a 3 or 4 year blip, BFC could come out of it very well.

It also means that 100% of the enabling development comes to BFC.

 

[JBN]

If only it was that easy. Lionel Road cannot be built without the help of a development partner.

We don't need a development partner, we need a very good team of advisors and a good building contractor.

The Architects will design the scheme, they know what is required from the brief given by BFC and Hounslow council.

We arrange funding on the back of the scheme, its phasing and the fact that we own GP.

We then enlist a project manager and a building contractor and off we go.

That is all Barratts will do, all we are doing is cutting out the middleman.

 

[Edmundo]

Er, who's going to finance your scheme, JBN?

 

[kevalutonbee]

We don't need a development partner, we need a very good team of advisors and a good building contractor.

The Architects will design the scheme, they know what is required from the brief given by BFC and Hounslow council.

We arrange funding on the back of the scheme, its phasing and the fact that we own GP.

We then enlist a project manager and a building contractor and off we go.

That is all Barratts will do, all we are doing is cutting out the middleman.

If we don't need a development partner and could go it alone, why are we stiil at GP, its not as if the need for new revenue streams etc is something new

 

[rebus]

We don't need a development partner, we need a very good team of advisors and a good building contractor.

The Architects will design the scheme, they know what is required from the brief given by BFC and Hounslow council.

We arrange funding on the back of the scheme, its phasing and the fact that we own GP.

We then enlist a project manager and a building contractor and off we go.

That is all Barratts will do, all we are doing is cutting out the middleman.

This is all very well, but this sort of project management costs a huge amount of money.

If there had been a solid business case to do the project alone, well, it would have been done already. There is no way BFC could have levered several million pounds to buy the Lionel Road site by itself.

 

[JBN]

Er, who's going to finance your scheme, JBN?

We arrange funding on the back of the scheme, its phasing and the fact that we own GP.

This is all very well, but this sort of project management costs a huge amount of money.

If there had been a solid business case to do the project alone, well, it would have been done already. There is no way BFC could have levered several million pounds to buy the Lionel Road site by itself.

Has it been looked at though?

As for the cost of project management, there would be a developers profit built into the appraisals as well as an allowance for fees.

I'm still waiting to find out what plan B is.

If we don't need a development partner and could go it alone, why are we stiil at GP, its not as if the need for new revenue streams etc is something new

I've just offered up a potential Plan B or C. We don't necessarily need a development partner if we have a good enough proffesional team behind us.

If it has been looked at and discarded then so be it.

 

[rebus]

Has it been looked at though?

As for the cost of project management, there would be a developers profit built into the appraisals as well as an allowance for fees.

I'm still waiting to find out what plan B is.

Of course it was looked at. I'm not sure what you're driving at. I will repeat, the stadium cannot be built without assistance from a developer.

 

[kevalutonbee]

With the exception of Wembley and possibly MK which new stadiums built in the last few years has been built WITHOUT a development partner?

 

[Gee Bee]

I will repeat, the stadium cannot be built with assistance from a developer.

 

[rebus]

Post amended.

 

[JBN]

Of course it was looked at. I'm not sure what you're driving at. I will repeat, the stadium cannot be built with assistance from a developer.

A developer is just a middleman who gets a planning consent, 'builds' out the development and takes the profit.

Developers do not necessarily build, they sub it out to a building contractor.

The planning consent can be done with the assistance of the architect with input from Hounslow council to achieve said consent.

Consent is gained, we arrange funding, get a project manager on board.

The project manager would work with the architect to agree the specification and appoint a building contractor on a fixed price contract and hey presto we are away.

I've worked in property development with several end users who all developed for themselves and hired in the necessary labour.

We don't have to have a development partner, we can buy in the experts. This cost is known at the start and accounted for in the appraisals.

It can be done.

I worked with a residential developer, he hired in all his labour.

 

[rebus]

I worked with a residential developer, he hired in all his labour.

Is this an extension to a house or a 500m stadium complex.

 

[JBN]

Is this an extension to a house or a 500m stadium complex.

lol lol :grey: :grey:

A bit bigger than a house extension but not quite as big as Lionel Road could be.

 

[Banana]

So JBN wants BFC to become a property developer. FFS they couldn'r even run a pub

I believe that using those with the relevant expertise is the more prudent option myself.

 

[rebus]

So JBN wants BFC to become a property developer. FFS they couldn'r even run a pub

I believe that using those with the relevant expertise is the more prudent option myself.

Well put. Unfortunately. I could mention a few other things as well.

 

[Les Beeavinu]

BFC would be mad not to offload the risk of the development to a third party.

 

[JBN]

So JBN wants BFC to become a property developer. FFS they couldn'r even run a pub

I believe that using those with the relevant expertise is the more prudent option myself.

You can bang your head as much as like, try putting my plan to someone who knows what they are talking about and then comment. I've already said that we would 'buy in' the relevent expertise, they would form the proffessional team.

I have already said that BFC would be taking on the risk, but we are talking about moving to a 20k+ stadium when we can just about muster 5,000 for a home game. There is risk, regardless.

This is a potential plan B/C because so far, after 2 or 3 attempts of asking, no one seems to be able to come up with one, or is it that plan B is to stay put at GP?

Plan A seems pretty wooly at the moment, as no one seems to know what are getting apart from a stadium and possibly some enabling development which consists of ......................?

 

[rebus]

try putting my plan to someone who knows what they are talking about

Don't you think this was explored prior the agreement being signed?

 

[JBN]

Don't you think this was explored prior the agreement being signed?

Its Brentford innit.

We couldn't organise a piss up in our own pub.

I've offered it up as a potential plan B as no one seems to able to tell me what Plan B is.

It is a possible solution IF our development partner cannot go through with the development.

So come on Mark/Banana, what is plan B? Same as plan A with a different partner or stay at GP?

 

[kevalutonbee]

You can bang your head as much as like, try putting my plan to someone who knows what they are talking about and then comment. I've already said that we would 'buy in' the relevent expertise, they would form the proffessional team.

We have bought in expertise. They are called Barrett

There's only one F in professional

 

[JBN]

We have bought in expertise. They are called Barrett

There's only one F in professional

We haven't bought in expertise, we passed our option to purchase to Barratts and we have/are signing a development agreement with Barratts. Barratts will build the houses and we get a stadium.

We don't what the stadium deal is freehold/leasehold/long leasehold, we don't know what supporting uses we will get or are planning to get to go with the stadium, all we do know is that Barratts are looking to build 500 units and are currently heading up sh*t creek. At close of trading last night, Barratt shares had dropped to 91.5p, from a 12 month high of 1075p. They are currently trading today below 70p.

I've offered it up as a potential plan B as no one seems to able to tell me what Plan B is.

It is a possible solution IF our development partner cannot go through with the development.

 

[Banana]

JBN - email Brian Burgess at his Bees United email address. I am sure he has plenty of time to listen to you.

 

[VTG]

JBN:
Griffin Park equity: ~£13 million (from what I can gather from previous discussions)
Lionel Road complex cost: ~£500 million (or about 1.45 million season tickets)
Dig deep!

 

[JBN]

JBN:
Griffin Park equity: ~£13 million (from what I can gather from previous discussions)
Lionel Road complex cost: ~£500 million (or about 1.45 million season tickets)
Dig deep!

Thats why the development is phased.

Forward fund phase 1, build it, sell/rent it, use it fund phase 2 etc etc.

No developer in their right mind would walk onto a site and build the whole thing out in one hit.

 

[kevalutonbee]

Thats why the development is phased.

Forward fund phase 1, build it, sell/rent it, use it fund phase 2 etc etc.

No developer in their right mind would walk onto a site and build the whole thing out in one hit.

So which bit do you build 1st then the ground or the other stuff?

If we build the ground first how do you fund stage 2?

If we build the other stuff first do we have to have an agreement like we seem to have now where we play GP until the ground is ready?

 

[VTG]

This plan is more flawed than my matchday tactics.

 

[rebus]

This plan is more flawed than my matchday tactics.

:yes:

 

[Luke Kirton]

I also am a bit confused JBN.

are you saying that first we buy the land back from Barrats at around what £11M? and then build a phase one of a total £500M project. What with?

We have to get the land value first, ok possible with the sale of Griffin Park

Then we have to put the funding for phase one up front. err where does the money come from? lets say we got best price for the land a GP at £15M and somehow managed to buy the land at Lionel Road for £11M would £4M be enough to complete phase one?

Where would we play in the meantime?
How long before the revenue is enough to afford phase two?
What if we can't shift the houses for sale?
What if??????

 

[Banana]

What would Plan B be?

 

[abee]

........ lets say we got best price for the land a GP at £15M and somehow managed to buy the land at Lionel Road for £11M would £4M be enough to complete phase one?

Ahem....as an interested party I think you'll find that there are fairly substantial loans to be immediately repaid upon any sale of GP and unless my calculator is up the creek then there is not enough equity in GP at your suggested £15m sale price to even buy the land at Lionel Road.

 

[Leicester Bee]

Just out of interest, how has the downturn in demand for homes affected Barratt?

 

[JoeBourke]

lets say we got best price for the land a GP at £15M and somehow managed to buy the land at Lionel Road for £11M would £4M be enough to complete phase one

Luke,

you seem to have overlooked the circa £6m of external borrowings already secured on Griffin Park there.

Personally, I think the correction in the housing market will prove to be a benefit in the longer term. This return to sanity should bring some long overdue stability back to the housing market (even-though there may be much pain to go through over the next few years) and prove of assistance in developing a more robust feasability and development plan for the Lionel Road scheme.

In the recent Lionel Road update from the Liason committee, the following was reported:

Peter Murphy of Barratt West London then spoke about finance and timescales. He talked of this being a £500m project, with a target to complete the stadium and ‘new Fountains’ in time for the 2012 Olympics, following which residential development on Griffin part and the old Fountains site would take place over the next two years. The aim is to submit a planning application by April, 2009, and have planning approval by December, 2009. The construction period would follow this.

Peter then invited questions from the group, and certain points were discussed / clarified.

Decision making will be made between Barratts and BFC (LR) Ltd, following gathering of opinions and information on relevant issues.
Barratts will employ a specialist contractor and a project management company to build the stadium.
Residential development on Griffin Park would (subject to planning permission) start at 3 storeys, rising inwardly to 4 & 5 so that the development could blend in with its surrounds, and become the hub of the local area.
There is no great concern about recent developments in the housing market. The economic situation is one of low interest rates, high employment, high demand for housing, and low supply of property on the market. This is a long-term project, and fluctuations are to be expected.


Decision making on the overall project is already being undertaken jointly between Barratts and BFC(LR) Ltd and I would imagine that we would get as far as securing a planning consent, regardless of the current state of demand in the housing market. I suspect we will have to wait until 2010 to discover if the market will have recovered sufficiently to allow for construction to be completed in time for the 2012 Olympics.

The housebuilding companies seem to be relying on the easing of access to mortgages as a panacea for the current downturn in demand, but I am not so sure that this will prove to be the case. With current mortgage interest rates running well above residential rental yields, buy to let investors are having to feed new investments to cover the shortfall betwen rents and mortgage payments. Without the prospect of substantal capital gains and indeed falling asset values, new investments are unlikely to be of great appeal to property investors, whether cash or highly leveraged investors. First time buyers can similarly be expected to be cautious about putting themselves in a negative equity position and would prudently wait until the market bottoms out before taking the plunge.


There is a good article in the Spectator discussing the issues http://www.spectator.co.uk/business...ouseprice-recession-must-run-its-course.thtml


JBN's proposals would either put us in the Premiership at a single stroke or finish us off once and for all. Unfortunately, I think the betting would be more on the latter than on the former.

 

[Edmundo]

I still don't know where JBN thinks the finance is coming from. Who is going to advance the kind of sums needed to a lower league football club with a long history of losing money?

 

[Gee Bee]

I still don't know where JBN thinks the finance is coming from. Who is going to advance the kind of sums needed to a lower league football club with a long history of losing money?

Roman Abramovich?

 

[Beebop]

Joe
I think that JBN was just following your Theodore Roosevelt's quotation

 

[Deathstroke]

I also am a bit confused JBN.

are you saying that first we buy the land back from Barrats at around what £11M? and then build a phase one of a total £500M project. What with?

We have to get the land value first, ok possible with the sale of Griffin Park

Then we have to put the funding for phase one up front. err where does the money come from? lets say we got best price for the land a GP at £15M and somehow managed to buy the land at Lionel Road for £11M would £4M be enough to complete phase one?

Where would we play in the meantime?
How long before the revenue is enough to afford phase two?
What if we can't shift the houses for sale?
What if??????

Were gonna need bigger buckets......

 

[Loughtonbee]

Fair play to JBN for coming up with the suggestion but if Persimmon, Barratt, Taylor Wimpey et al are sh*tting themselves at the moment then would a team 'led' by the 'expert management' of BFC & Hounslow council really be the people to take on the housing market? Personally the only people I'd less like to see get involved with a project like this than BFC are the council.

Now is not the time to play property speculator, the mortgage market's pretty frozen, prices are falling, deals are falling through, finance for large projects is harder & more expensive to obtain.

I've worked as an accountant in the building industry nearly all my adult life & I can't see anyone being in any rush to speculate on something like Lionel Road at the moment & I certainly don't think we should.

 

[w6bee]

It looks more and more likely that we may have missed the boat in selling Griffin Park (unless this has already happened around the back door?). With property prices slipping I do not think it will be long before Brentford is not seen as being so desireable for investment. In a rising market area's like Brentford get a halo effects from neighbouring places (eg. Chiswick). I can remember flats in Docklands being available for less than £50K in the last property slump as there was over supply at the time. In the long term Brentford will probably do OK but in the medium term it could face a bigger slump than other West London area's as it still needs a lot of regeneration (particularly in the High Street area).

When I was younger football grounds were always about to be turned into supermarkets and in the last few years it has been luxury flats. Does anyone have any ideas what the next band wagon will be????

 

[chizbee]

So, in lamens terms,doe's this mean that our new ground (at this present climate) has gone tits up ??????

 

[kevalutonbee]

So, in lamens terms,doe's this mean that our new ground (at this present climate) has gone tits up ??????

Not sure but does post 389 help at all

 

[Les Beeavinu]

So, in lamens terms,doe's this mean that our new ground (at this present climate) has gone tits up ??????

No - it's web chat and speculation.

 

[Gazza Bee]

So, in lamens terms,doe's this mean that our new ground (at this present climate) has gone tits up ??????

Not at all, this site has its fair share of scaremongers and prophets of doom so I wouldn't listen until anything concrete occurs, which goes for good and bad news btw

 

[JBN]

I've offered it up as a potential plan B as no one seems to able to tell me what Plan B is.

JBN - email Brian Burgess at his Bees United email address. I am sure he has plenty of time to listen to you.

What would Plan B be?

Reinforces my decission not to rejoin BU