What did Manchester City gain in exchange for Maine Road?

[lancs blue]

Let's be honest, at 'the time' the land and the housing stock around Maine Road/Moss Side was worth jack shit. Obviously nobody knew what was about to happen with land and house prices. If we had know we'd probably have drove a harder bargain. Then again, land and housing prices only recently crashed, and are slowly climbing back up. I think we got a good deal in the end.

BTW. Would ADUG have bought us if we were still at MR? I think not. It was meant to be.

So you're saying that City's ownership of Maine Road was worth less than the chance of renting a new stadium?

I'm not having a go either, mate. Just asking if the Club knew Maine Road was worth nothing at the time and renting a brand new stadium was worth losing the freedom to develop their own stadium.

But that's the whole point, there was no "freedom" to develop our own stadium because of the layout of the surrounding houses, especially those on Thornton Rd near the corner of the Kippax and Platt Lane and those at the back of the North Stand. We could never have developed Maine Rd into a 50k all seater stadium without buying up and knocking down those houses and at the time that simply wasn't a viable option.

 

[Mr Ed (The Stables)]

I personally don't miss Maine Road, just like I don't miss receiving the cane off my head master at school in the 1960's. However I now look back fondly on both periods of my life with great affection, especially after alcohol!

 

[NPBlue]

We had a vote as fans and decided to kick Maine Road into touch.

Maine Road had passed it's peak, and the new stadium seemed fantastic at the time.

Manchester City gained a very good stadium, Manchester Council got some land, but more importantly, a revenue from City that helps the promotion of sport in the City of Manchester.

City got a shiny new ground that attracted a man with Gazillions in his pocket and chose us over every other club in the world, and the rest will soon be history.

Not a bad exchange, in my view.

 

[djm68]

Yes but we won´t expand a stadium owned by someone else.

Responded to this on another thread the other day:

It is the "own" bit that some people seem to have problems with. As has been said before, the lease is so long that, in effect we do own it. As a generalisation the unexpired term has to be less than 50 years to have any detrimental effect on its value. Many people on the Forum will have bought and live in flats that are held on a 99 or 125 year lease. If asked if they rent or own the property , they will answer that they own it. City's lease is at least double the length of most 'owned' flats in this country.

The only other factor may be truly draconian covenants in the lease that restrict the use to the point where it has no value to anyone other than the current occupier. Our guys would not have signed such a lease and I gather from the club that our new owners have absolutely no intention of purchasing the freehold. They see it being leasehold as an advantage. The current arrangement ensures that we continue to work with the City Council at a very early stage, rather than formulating sophisticated and expensive expansion plans and then find them quashed at the planning application stage.

I hope it gets a point across because I utterly despair of our fans not grasping that there are occasions when a long lease is better than owning the freehold. Although the transaction was done before our new owners came in, they are sufficiently impressed to say this is a good deal and it suits us just fine...it is far too easy to believe those that went before got everything wrong...they didn't..they got alot right in very difficult circumstances and laid some of the foundations for where we are now.

As to others talking about the'council house', 'renting', 'don't even own their stadium'..just laugh. The deal that was done would have been one of the factors that attracted our new owner to us and not to some of these so called 'well run', "own income generated" pompous, but ignorant clubs.

 

[superwatsonwatson]

One gain in the exchange is, since moving, we have not had an attendance at a league game which has been less than the capacity of Maine Road, at the time we left. (Capacity was a little more than 35000)

 

[scall11]

Manchester City Council had a brand new stadium that was basically going spare after the 2002 Commonwealth Games. We had a stadium that was in bad need of repair, but the area was such that it just wasn't able to be turned into the modern stadiums of today.

The basic deal was that we 'swapped' Maine Road, land and buildings for the chance to have a long term rent of COMS. We had to pay some money up front to help convert the stadium into a football stadium and fit some of the interiors out though.

The deal was struck by David Bernstein, who was and is still very much admired in the City of London. He would never have signed the club up to an agreement that wouldn't have been fair.

But in basic terms, we gave up an old terraced house for a nice new mansion. We had to pay to put new furniture in it, but we didn't have to take out a huge mortgage to pay for it, we paid for in on a long-term small rent, which we could afford. And by being in this new mansion, it meant we moved up in our social standing, and could host a lot of decent parties at the mansion, which led to other things, which wouldn't have happened in our terraced house. As has been mentioned, could you imagine the guys from Abu Dhabi being shown around Maine Road and them being left with a sense of 'wow, this is a club that has so much to look forward to in the future'.

Don't a lot of business rent office buildings instead of buying them? Why? Because on the balance sheet, it makes sense to spend a few million on rent a year, than to pay off a long-term debt (which is hard to get out of), including interest.

I can only presume that the new owners have looked at the deal we have with the stadium, and if it was horrifically biased against us, and we were being ripped off, they would have bought the stadium immediately. But the deal means we get better facilities for hospitality, conferencing and the increase in capacity which we just wouldn't have had at Maine Road. Our owners employ some of the best advisors and real estate lawyers in the world. They will have looked at the deal, and the deal still stands.

Another aspect of the deal which I like is that the City of Manchester Stadium was built by the City of Manchester, for the City of Manchester and every time the capacity is over 35,000, then the City of Manchester benefits directly from the revenue that we pay to the council.

Our agreement with the council over the stadium has been applauded all around the world in terms of the sensible nature of it. The council built affordable housing on the Maine Road site, the stadium found a long term use for the stadium after the Games (take note Sydney, Athens etc) and we got a brand new home.

In terms of expansion, changes etc. I doubt the council would have a problem with it. To all intents and purposes, it's "our" stadium, but the council do technically own it. I can't really see them putting a stop to us improving the stadium further.

 

[Dave Ewing's Back 'eader]

Let's be honest, at 'the time' the land and the housing stock around Maine Road/Moss Side was worth jack shit. Obviously nobody knew what was about to happen with land and house prices. If we had know we'd probably have drove a harder bargain. Then again, land and housing prices only recently crashed, and are slowly climbing back up. I think we got a good deal in the end.

BTW. Would ADUG have bought us if we were still at MR? I think not. It was meant to be.

They would have gone elsewhere. Look at the alternatives - clubs who were regarded as sleeping giants - EFC, Barcodes, Wednesday. Newcastle might be the exception but these days if you wish to fulfill Platini's missives, a 60000 stadium filled every week is an essential starting point. Everything that a buyer would want was in place at MCFC - with one notable exception - the playing staff.

 

[our tommy]

In very simple terms we get the Stadium for the next 250 years at a rent which will be substantially less than the market value in exchange for giving them Maine Road.

 

[Sheikh Rattle n Roll]

If I remember correctly around the time, the Maine Road site was valued around £60 million, although that figure seems a little on the high side to me. What many people forget, mainly United fans, is that City actually contributed millions to have CoMS transformed into a football stadium. CoMS wasn't just built with Public Money, the Club contributed too, but as with many things about City, certain people prefer to believe the lies that have been told in recent years.

It makes me laugh with United fans still going on about our Council House, they believe the myth that they helped pay for CoMS with their Council Tax payments, although I didn't know Local Councils in the Home Counties contributed to Manchester City Council.

 

[Prestwich_Blue]

It was a complex deal that is still shrouded in secrecy to a large degree. I and others have done searches on public databases but can't find anything. It didn't only involve the council but Sport England as well.

As people have said, we have the stadium on a long-leasehold and that is, in accounting terms, known as an operating lease. We are responsible for all the upkeep and maintenance of the stadium whereas if we were renting it, the council/sport England would be. It's as good as owning it although there are covenants in the lease that involve certain restrictions.

A lessee would normally pay a premium for the benefit of a leasehold term, with that premium reflecting the remaining term. In our case that term was 250 years (not 200). I think (although I'm not 100% sure) that Maine Road was effectively used as the lease premium.