Update - I can see how the council had the stadium built as a community asset and would maybe accept a peppercorn as a result but allowing the lessee SMC to profit from a sister company using it seems mad as there is nothing in it for the tax payer at all.....if I need the history explaining and that is too complex just ignore me as I am sure I am missing something basic (don't say a brain)
The stadium was built as an asset for the community, not as a money making exercise, it's never actually raised any money for the taxpayer (AP used to pay a nominal amount as a goodwill gesture, but it's never generated any income of any significance).
The Council are meant to share in any profits made by the SMC. The larger the profits the more money the City Council gets. With the owners of the SMC also being the owners of Hull City they can determine how much profit is made by the SMC by deciding how much rent is paid. Which is why the Council have received peanuts during the time the stadium has been open. The owners of Hull City could decide to pay double the rent to ensure profits were made and the Council gets some money, but why would they?
'there is nothing in it for the taxpayer at all..........' Think back to the days before the KC Stadium. Hull City were playing in the bottom league in a ground that was falling down around their ears and a 10,000 crowd was seen as exceptional. FC were in a similar positon playing from the boulevard which was basically a two sided **** tip, watched by two men and a dog. Both clubs were going nowhere fast. Visitors to Hull for both of these 'attractions' were minimal to say the least, the spin-off's from having two professional sports clubs in the same area even less so because so few people were watching them. The KC has brought in millions of people to Hull since it was built, all who spend something in the local economy, which creates wealth which creates jobs. Both clubs have progressed beyond their wildest dreams since moving to the KC and in turn boosted the local economy in their own way. Think of Hull today without the KC Stadium. It's just a pity HCC have not developed the asset which they provided because it is one of the few success stories to come out of the KC shares floatation.
Ahh those pesky old minutes. One day one day... blimey that's another set of minutes I'll never see. Open and honest eh
Does seem somewhat baby and bath water from the council or a missed opportunity or "WTF did we do that" but hey ho....
At the time, they were far more concerned with coming up with an arrangement that couldn't cost them, than they were about one that made them any money.
So - Why build it.....it is not a community asset if it makes no money for the taxpayer and the community has to pay to enter it. It is a private concern earning money for the tenant and lucky management company that was set up to run it. Thanks for all the replies.
It suited both the Council and Hull City at the time. Hull City got a brand new stadium and all they had to pay in rent was enough to keep it ticking over. A bit like moving into a brand new house and having to pay nothing except the rates, the utilities and any repairs not covered by warranties. Don't underestimate the benefit we got from the deal as a lower league club. The problems came with our successes on the pitch plus an aging stadium. Hull City are, in effect, responsible for all the repairs and renewals that are required. In addition the SMC, because of the lease, is unable to borrow on the asset to fund any expansion. It means if we want a 30,000 seat stadium we have to find the cash elsewhere or wait until the Council find the money to improve it.
As in effect Hull City get to use the stadium for free there is nothing to stop the club paying a higher rent in order for the extra income to be used to pay for the repairs, updates & expansion of the stadium This is why I feel there is a conflict in the SMC being owned by the same people as Hull City Perhaps if the SMC were run by a 3rd party the funding & charges to Hull City & Hull FC could be fair....income could be reinvested in the stadium....there would still be no payments to HCC as the profits would be used to pay for the ground improvements....being accounted for before any net profit statement from the SMC it could also be that as an independently run company the SMC might be able to apply for additional grants in order to help fund any expansion & improvements
Hull City pay around £4 million a year already. Hull FC around £500,000. All the repairs and updates are currently paid for by Hull City. Since Assem Allam has taken over the updates, repairs and renewals have cost more than the rental income and have been paid for in the form of loans. The last accounts showed Hull City were owed over £9 million by the SMC. Some of that was the money paid to the mortgage obtained by Bartlett with the Royal Bank of Scotland but the bulk was to cover trading losses incurred by the SMC. The SMC does not have the money to pay cash for any expansion and cannot use the stadium as security for any loans. In reality the money has to come from somewhere else, either the owners or Hull City. I think the current rental agreement is based on match receipts so Hull City may end up paying twice for any expansion. First by paying for the expansion and second in increased rent. I don't suppose we'll have to wait too long before we see what the intentions of the new owners will be with regard to the stadium.
'Hull City are, in effect, responsible for ALL the repairs and renewals that are required.....' What are Hull fc responsible for ?
Research indicates that one of those actually happens. Although the advice on here has my opinion bouncing around like a ping pong ball in an Asian strip joint, I do look forward to seeing how it pans out under new stewardship. In that respect my initial post meant to ask "is the takeover by overseas property developers something people feel good about" but it was a pretty over-worded effort - as Chaz said in his "eh?" reply. Perhaps the detailed responses since then can bring that question back on track. For the record I think they will prove to have more about them in terms of understanding the supporters (simple research of the past three years will tell them that) and a deeper resolve in developing property than the old man has. So basically "good" from me, but we will see. Chinese business interests investing in the UK is no new thing and these people have experience of red tape and planning and related long term objectives and how to achieve them etc. Surely....?
which one? anyway on the question "is the takeover by overseas property developers something people feel good about" then my answer is simply that I would feel good about almost any takeover at the moment because the club needs the As to move on. I have got no particularly positive feelings about the new owners (apart from them not being the current owners) and I'm generally cynical about why someone would want to buy a football club in the first place
Abramovich is hardly squeaky clean and hes done alright by Chelsea so im not arsed about how they've made their money.
I was perfectly happy about the Allams taking over when they did. To me at the time, they were locals, and had the best interests of the club at heart. I still, even now, believe they had the best interests of the club at heart, even if some of their decisions were misguided, and in one case, just completely wrong. They are just not football people, and do not understand the game, or anything around it. This isn't necessarily a bad thing, and some of their decisions and actions have been extremely positive. The clubs in the best position it's ever been. They are handing over a well run and good value legacy. On balance for me, they've still been good owners, but leave under a cloud which is a huge shame. I'd never think about them in the same league as some of the ****ers we've had who knew exactly what they were doing. These new owners, I am highly suspicious of. Nothing connects them to our area. What are their motives? I don't quite understand why some people seem to think the doors to the KCOM will be cast open and fans groups will be beckoned inside to sit at the table, drinking, eating and being involved in decision making in how the club is run.
