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NEW RENT AGREEMENT KEY IN LANDMARK PLANS SAYS GEORGE

23 September 2015

Chief Executive clarifies comments regarding Stadium Redevelopment and Sporting Village

Jez George describes the importance of a successful planning application that would enable landlords Grosvenor the opportunity to draw up a new and financially viable lease agreement for Cambridge United at the Abbey Stadium.

Recently the U’s Chief Executive was quoted in the local media as describing the planning application for the redevelopment of the ground on Newmarket Road and the creation of the Sporting Village in Trumpington as a “defining point” in the club’s history.

George explains the reasoning behind the statement and the huge significance that the planning application has in securing a long-term future for Cambridge United.

He said: “The recent article in the Cambridge News touched upon our ability to generate revenue and the improved facilities that we could potentially achieve with a successful planning application; however the most important aspect for the club is the rent agreement.”

“When the ground was sold in 2004, the lease agreement that was agreed at the time makes it extremely difficult for the club to have any security in the long-term. The rent began at £200,000 per year and if Grosvenor were to charge the club the full amount in accordance to that lease agreement, then it would now stand at over £300,000/annum.

“The way the agreement is index linked to rise every five years in a rent review, would see the club being liable to pay over £400,000/year in five years’ time and more than£500,000/year from 2025. This is obviously cost prohibitive to the club.

He added: “We are very fortunate that Grosvenor have been such good landlords to us because in the first three years of them being involved, from 2010, we didn’t pay one penny in rent.  We paid £50,000 in 2013/14, £100,000 over the course of last year and will pay the same sum again this year.  Grosvenor are therefore currently charging us less than one third of the amount that are entitled to demand within the terms of the original lease.

“The current level of rent has been budgeted and factored into our business plan but when looking at how the rent could increase in the future if planning permission is not granted, then you can see there is an obvious problem.”

The Cambridge United CEO describes the opportunity to settle a new agreement with Grosvenor for the Abbey Stadium that is affordable and reasonable for all parties involved is the only way Cambridge United can potentially grow in the future.

George continued: “The only way the club can secure its long-term future is for the current lease agreement to be ripped up once and for all, and for the club to be granted an affordable, sensible and financially viable agreement that could see Cambridge United prosper in the future.

“The planning application is therefore key because the only way Grosvenor can rip up the old agreement, bearing in mind they have already written up off more than a million pounds in rent, is to get planning permission which would enable development in Trumpington.

“That would allow them to issue us a new lease agreement, which would secure the future of the club.  The new facilities within a Sporting Village at Trumpington and enhanced facilities through the redevelopment of the Abbey Stadium would then allow the club to grow and have a realistic ambition to emulate the achievements of the past in progressing up the football pyramid but in a sustainable manner.  

"With our existing facilities, we will hit a ceiling in terms of our academy, community work and commercial activities, as well as always having the issue of rent to deal with in the future.  Therefore, it cannot be understated how important the planning process will be for the long-term future of the club and our contribution to the wider community of Cambridge."


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