You’ll remember in October last year I told you I was in receipt of a Heads of Terms for the sale and leaseback of Ibrox, Murray Park and the Albion Car Park. The internet has been full of chatter around this subject for the last week but I didn’t have an update on the subject until last night.
At the time I said the deal would not be signed until after the share issue, which took place in December. Charlie is back in town, and I hear the Sale and Leaseback-ball is in play.
According to the Heads’ the buyer will pay £7.285m for all three properties and, in addition, will provide a loan to the tenant of £6.9m at an interest rate of 15% p.a.
Rent will be reviewed every five years, on an upwards only basis, either at RPI or 2% p.a., whichever is greater. RPI is currently 3.3%
Say Goodbye to Murray Park
The tenant “will take a lease for the stadium and the car park on a 20 year lease at an initial rent of £1.8, per annum”. Murray Park is offski, gone, no longer available to Rangers International, or any of its successor clubs.
Interest on the loan works out at £985.5k per annum, so rent plus interest would be £2.835m p.a.
Top line figure for both sale and loan is £13.835m, however, the first three years rent (£5.4m) will be held back as no one is prepared to guarantee the rent, so actual cash into the business will be £8.435m.
Murray Park planning permission
If the new owner of the properties attains planning permission for residential properties at Murray Park within three years of the deal being signed, a provision releases the seller from having to repay the outstanding portion of the loan. If planning permission is achieved after three years, no element of the loan is forgiven.
Potatoes
The buyer can do whatever they like with Murray Park. Can you suggest a suitable use? Perhaps they’ll plant potatoes.
Securitisation
“Rents will be guaranteed from ticket receipts and a first charge on the season tickets income will be granted.”
The tenant has the option to buy-back the stadium (only). If the stadium is bought-back in year one the cost will be £10m. Thereafter the purchase price will increase by 12% p.a. until year 10. After year 10 the right to buy-back the stadium will be at “Market Value but no less than £20m”.
Should they buy-back the stadium, the lease will remain in place for Albion Car Park at a rate of £250k p.a. (subject to same rent review arrangements).
So what does this mean? The cash will be welcome and will enable to club to survive until into next season. If they spend the money on lottery tickets, there’s a chance they will get lucky and survive well into the season after next.
Suggestions that some people are preparing to squeeze the last penny out of a busted brand are contemptuous.
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C1st
Magic vid.
Thanks for posting.
HH
heads of terms are just a proposal, do we know if this is something which has been proposed by a potential purchaser or or if they have been the subject of any negotiation.
Ordinarily with a sale and leaseback, there’d be a pretty onerous repairing obligation that’d include an obligation to maintain property to good and subtantial condition and to comply with statute, such as asbestos at work regs. So Rangers (or whatever they’re called) would have an obligation to maintain and repair the building, pay all rates and utilities bill. If there is any asbestos in the building they’d have to identify its location and monitor it. No obligations to remove it, only becomes problematic if it’s in a position which is likely to be disturbed.
RPI or 2 per cent uplift isn’t too bad really. Alternative mechanism is a review to open market value, but there’s a lack of similar properties which it could be compared against so it’d probably be unworkable.
3 years’ rent deposit seems pretty onerous and highly unusual to me. That suggests that the docs might be the product of fantasy rather that a representation of an actual deal which is on the table. Would like to be proved wrong though!
If I were Ticketus (which I’m not mercifully) I would have have:
1. Established who, in Law,owns the clear title to the real assets
2. Demanded a Fixed Charge on the real assets…….
http://www.nortonrosefulbright.com/knowledge/publications/48442/in-the-know-fixed-versus-floating-charges
3. If Ticketus have done this then they need not pay to enter the gravy train that the lawyers are feasting on. They’re 22M is secure……in Law
With 22M on the table it would be absolute buseness folly of Ticketus not to spend say 50k with their lawyers and conduct this type of due diligence.
Follow the money if you want the truth.
Just saying……….
BB – at last, good news on the player front. Doubt Virgil will be match fit enough for the away trip next week, but should feature in the home leg.
T4
Police arrested two kids yesterday, one was drinking battery acid, the other was eating fireworks. They charged one and let the other one off.
So do I understand this correctly? The Sevco Temple will be taken out of the hands of the huns and they will have to rent their own house of worship. Having been raped and pillaged by the spivs, they will now be forced into paying them rent for, well forever I guess, so that they can gather together and give humble adoration.
I can imagine how the Sevconians feel about that.
Well, my wife and I were married in a toilet – it was a marriage of convenience!
SOAL-An old Christmas cracker lying around…..
Paul 67
Surely the flaw or potential flaw in this lease back scheme for Sevco is that they would need Craigy Craigy Whyte’s authority to sell.
After all , does he not hold the deeds ?
T4-Hope Derk is back too.
Too many of our support look to the short term gain view of transfer dealing ….
Just because we has coin doesn’t mean we should pay over the odds!
If a player is worth £3m should a club pay £5m just because the have the cash ?
I’m happy the way our club is conducting their business!
Boom and bust?
An! No thanks
When I was christened, the priest filled the font with petrol and set it alight.
That was a baptism of fire.
Tim Vine CSC
Paul67 –
Never mind Ibrox, Murray Park and Albion – who owns the bike?
Afternoon lhads/lhassies, popped in for a bit of advice, sittin now on a building site in toasty warm Riyadh since Tuesday, will be here at least for the following 6months to a year, anybody here in the area with any gen on seeing the games, entertainment to be had etc etc. Play a bit of amateur fitty at home, so lookin if possible for any 5s or full pitch games to be had (as soon as the sun goes down). HH
Paul67
Now look what you’ve started.
this article is the subject of a five pager on Follow Follow already.
The (whistling in the dark) consenus is it’s the rabid,demented ramblings of an obsessed Tim. When will they ever learn?
However
There are a few saying they would be mad to ignore it.
I can taste their fear.
Which is good.
Not been on as frequently as I once wa – Have we signed a Left Back yet??
SwanseaBhoy
Steinreignedsupreme
She belongs to Mac Gregor
Cant believe people are still going on about a CH signing.We dont need one.Rogne and Wilson have been replaced.Probably by better.To think we could find a replacement for Wanyama,or even need to,is off the mark.We have signed Derk,so that tells us Lenny is looking at a new sort of line up.We have to accomodate,Broony Ledley,Ambrose,Commons,Derk,Forrest,Sammi,in the midfield.Another?!!!!!Dont think so.
We need a striker,nothing more,nothing less,IMO.I would love Finnbogason,and dont think he is out of our range.Pukki,does not fill me with confidence,but I know little of the boy.His record not anywhere near the Finns.If,IF,he is being considered because he is a cheap and second rate option,that is a disgrace.
A top striker would see us as a force to be reckoned with.A bargain at £5 million .We WOULD come out of this window stronger,and much richer.I am afraid I have wasted 5 minutes of my life posting this with some.Forgive me,I just cant see the problem.
But what do I know?.
It’s not just us who get our sevco news here. The top thread on FF is entitled: CQN on ‘Murray Park’
Was going to do ma first song in a while
“The hoose the hoose the hoose is on hire”
but then i saw the rest of teh lyrics i’d have to work with and didnt want P67 banning me :O)
Paradise Watch 11/10 – Salisbury 2.50
Phoenix Clubs 9/2 – Beverley 3.05
Amadeus Wolfe Tone 8/1 – Newmarket 3.15
Treble for today. Keep me ticking over.
LB
It appears to most people that the writing is on the wall for Sevco so why would anyone pay over 7 million for three properties now when they could possibly get them for half of that when Sevco goes into admin or liquidation again? Wait until they are on their knees again, that’s what I would do.
FC Augsburg (a team from Germany who were rumoured to be in the running for Finnbogasson with us) have just signed an Argentine striker called Raul Bobadilla from FC Basel.
Who knows if we are still in the running but we shall see.
Anyone like to hazard a guess as to how much we offered schalke for a player we could get for zilch in Jan..?
Headtheball
That’s only the scenario if Rangers actually own these properties.
LB
From the beginning I always believed that as long as the vipers nest remained, vipers would continue to come out of the woodwork and perpetuate the factory of hate in some guise or another. OK there could be a second or even third Administration but eventually backers would come in and make Sevco Mark 2 or 9 a viable threatening proposition.
If the Bigotdome itself along with training ground and Car Park passes from their control they will be permanently and irrevocably disabled. This was always the play I wanted but didn’t dare to even dream about. Even after reading Paul’s piece, I still don’t believe it will happen. I just can’t see it unless the likes of Dave King buys the place out and becomes some kind of benevolent landlord.
Headtheball – I can only see someone in oman or somewhere doing that and only after being totally assured on the planning side of things
Anyone local doing it would need to make sure all their premises where properly properly insured
I couldnt see the apartments thing getting past Sammonds crowd
Dexter
12:37 on
15 August, 2013
Paul67- again, an interesting article- But, why the continuing focus on another club???
I have been preaching the same gospel for some time.
To those critiquing Pauls article focus, i presume you have Celtic Stories to add, have offered to help him or have your own site in the offing?
I think we all know who will ‘buy’ the title deeds and eventually get their pound of flesh back….what’s that coming over the hill ?
Is it a bird
Is it a plane
nah its TICKETUS…never been far away ha ha ha ha
http://www.feantastisch.nl/augsburg-kunnen-finnbogason-niet-veroorloven/
Confirmation Augsberg have dropped out of the race for Finnbogasson as they canot afford him.
News about Ibrox is a tad worrying. I run a Face Painting company and I have a significant invoice into them (£220.75) that is now overdue.
I’m beginning to think that I’ll never see my money.
Should’ve learnt my lesson the last time…….
corkcelt
14:46 on
15 August, 2013
Even after reading Paul’s piece, I still don’t believe it will happen. I just can’t see it unless the likes of Dave King buys the place out and becomes some kind of benevolent landlord.
_________________________________________________________________
And that, folks, is the very first and very last time you will see the word ‘benevolent’ in the same sentence as Dave King. That man is a founder member – along with Ken Bates -of the ‘ I Know the price of everything and the value of nothing’ club.
They can’t take their cash with them to Hell but they will try.
Assuming Sevco do own the properties and assuming planning permission is not likely to be granted for housing, supermarkets etc, then it is in the interest of whoever buys them to make sure there is still a team to use the facilities and pay rent.
Therefore I can see any prospective buyer biding their time until the club is close to the point of extinction, but not quite there, before jumping in to get a bargain buy.
Tully, can you get face paint that changes from blue to green when it gets wet? :O)
FC Augsburg has hoisted the white flag in the battle for the signature of Alfred Finnbogason. The German club can not meet the asking price of sc Heerenveen.
Vinniethedog
From Transfer Markt
Helsinki striker Teemu Pukki joined Bundesliga side Schalke 04 for a fee of €1.5million (£1.3). The 21-year-old, who scored all three goals for Helsinki against Schalke in the Europa League, signed a contract until the summer of 2014.
Current Valuation on there says £2.2M
Factor in the fact that the contract runs out,
I’d hazard a guess offer would be around £1M
I’d say that’d be a good bit of business for all concerned.
I agree with the comments he doesn’t seem to be the type to spearhead
the attack with our current preference for 4-2-3-1
(Which demands and poacher type IMO)
But if we revert back to 4-4-2 and give the boy someone to play off of,
I reckon he’d do a good job for us.
For all you
Doubting Thomas out there
Celtic Football Club@celticfc5m
Good luck to Jackson Irvine who has joined Kilmarnock on loan until January 2014. (PC)
The unravelling of THEM and the fallout has massive implications for Celtic and Scottish football. Read back on the CF revelations if you have to remind yourselves.
Oh..and it gives us all a wee smirk…