Fratton Park, Tesco, and the Cost of Chainrai

The plans announced recently to construct a large Tesco store on land adjoining Fratton Park have been met almost entirely with positive reactions from within the Pompey fanbase.  There are however some sceptics, and it is them this post is really aimed at.  The plans as publicised now would see a superstore constructed on the Fratton End car-park and some of the land between Anson Road and Fratton Way, with some funds being contributed to PFC for future use.  This probably amounts to a few million which, for starters, will fund the catching-up of maintenance on the ground held over in recent years.

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This is a far cry from the grandiose plans of the Gaydamak era, when there was talk of moving to Horsea Island, or the Hard, or of developing a 45,000 rotated Fratton Park with World Cup ambitions.  All of that was dead in the water with the housing market crash and was torpedoed and sunk once Chainrai started poking his nose into our affairs.

Where we are now, with a Trust-owned club, is a stable but impoverished position.  We cannot pay fees for players, have to fund the CVA, have the Football League peering over our budgets (shame they don’t scrutinize owners as carefully, as Coventry fans will now testify), own no land beyond the footprint of Fratton Park, and have only just agreed somewhere to train next season.  The only thing we’ve got to be thankful for is (a) we own the club and (b) the property developer who owns the adjoining land helped us achieve that aspiration, and will be generating some modest capital for us to invest later on.

Anybody who thought that the Tesco deal was going to fund an immediate and complete redevelopment is nuts.  This was never hinted at by PST and is a fanciful notion given that PFC does not own the land the store is being built on.  There are people who feel that individuals in the Trust allowed perceptions to get out of hand in their social media postings.  I commented on Twitter a few times when the takeover battle was at its hottest that “message discipline” was lacking, but even so I think it’s harsh to accuse PST of encouraging unrealistic expectations.

I hope everyone recognises in time that this deal as it stands now is about as good as we could ask for, and in many ways better than we have any right to expect.   I have heard of people dreaming on message boards about one day buying up Alverstone Road and knocking houses down to expand the Milton End/stand.  Quite apart from being financially mad and unlikely from a planning point of view, anyone who believes in that sort of thing should remember the way it has made Liverpool FC an enemy of the community it grew up in.

It probably costs about £1000 per seat to build a stadium (assuming you already own the land); let’s assume Pompey stand to make around a couple or a few million from the Tesco deal and see where that gets us.  It does a lot of good in bringing the existing structures up to standard, but anybody who expects new stands or rotation is just going to have to wait for one of us to win a big Euromillions rollover.  The image of the block layout above suggests rotation will in fact be virtually impossible if Point Estates build that close behind the North Stand.

This Tesco deal is a version of something that goes all the way back to 2008, when Gaydamak started working on plans to redevelop Fratton Park, either by moving the club somewhere else or by developing around it.  Tesco have always been involved, and we should be grateful they have been signed up before the retail landscape changes any more; they are going to be cutting back on large projects like this in response to the growth of online shopping.

The sorts of numbers involved in the deal with Tesco we were working on under Gaydamak are huge, and I have collated some detail on them which I reproduce here for two reasons.  Firstly, as a reminder to the credulous that PFC in its current state is in no position to command the sorts of funds that a major redevelopment require; and secondly, as a last “what might have been” for the Gaydamak era, when we were probably £15m away from “getting away with it”, Premiership status, new ground, the lot, at a time when £15m was a small proportion of our total financial position.

A disclaimer: there is no reason to suppose that these figures reflect in any way those being discussed now between Tesco, Point Estates, or PFC, though they did reflect a project to build a major Tesco and rotate Fratton Park between 2009-2011, with Sellar Property coming into a joint venture with PFC.  These figures are for cash in and out of that joint venture and are “2008 prices”.

Click on the image below to enlarge it, but the totals are as follows:

Payment to store contractor: £14,990,000

Payment of various legals + Barclays (to keep them happy about PFC outstanding debts): £8,045,000

Payment to stadium contractor: £25,999,999

Payment to Sellar Property: £3,300,000

Loan repayment: £25,185,000

Total cost: £77,519,000

Offset against that payments in of £63,780,000 (loan £23,060,000 and Tesco £40,720,000) and you are still left, despite owning all the land and receiving the proceeds of sale, with a shortfall of £13,000,000 which Gaydamak was hoping to fund from Sky money, forward sale of boxes, naming rights, and other new revenue sources a modern redeveloped stadium would permit.  Of course, his real plan by the time this was being discussed was to sell the club on, much easier to do having got the stadium sorted.  Sellar Property would have then done a deal with him to develop the parcel of land not required for Fratton Park or Tesco.

Sellar

So you will see from this view of the figures that, even if we owned the land, it would still be a marginal proposition to do what some fans now demand, a rotated and instantly-modernised Fratton Park.  You could reduce that shortfall by reducing the planned capacity from 30,000 (don’t fill corners, downsize the new stand on the Milton “side”) but I doubt the saving would be all that great.

In reality, we are going to be living within the current footprint of Fratton Park, possibly with a large North Stand (there is room to expand behind it onto the new car park) providing most of the future capacity uplift.  Personally, I’m happy with that prospect.  It offers us every prospect of being able to get up towards 30,000 capacity if finances permit without losing our roots.  I’m unashamedly sentimental about this.

The planning application for the Tesco will be going in shortly; there may well be some objections from local traders, and some concerns about traffic flow, but I am confident the plans will get a fairly straightforward passage.  Then for Tesco I imagine the plan will eventually be to close the Crasswell St store and attempt to redevelop it.  That prospect does inspire a bit of worry, given the number of “black holes” we already have in key sites around the city, but it is a few years away yet.

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One Response to Fratton Park, Tesco, and the Cost of Chainrai

  1. JohnH says:

    Just wanted to comment on the future of the Crasswell Street Store. When Tesco proposed the North Harbour store there was great concern that their Cosham High Street shop would close. It didn’t and is thriving as a “Metro” branded outfit. I can’t see Tesco leaving the city’s principal shopping centre – if they did then we’d see someone else moving in pretty quickly (ALDI or Lidl perhaps) and Tesco wouldn’t like that. My money is on Tesco staying put at Crasswell Street whatever happens at Fratton Park.

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