COMMUNITY PURCHASE
By purchasing shares to become a member of Slaley Community Assests Ltd, you can help raise the money to buy The Rose and Crown both for the community and for our visitors in perpetuity. We must raise at least £250,000 in shares and loans from this offer for the purchase to go ahead. This minimum sum would cover the purchase and the essential repairs required to allow the pub to begin to trade.
In order to demonstrate commitment to the project, at least £130,000 of this must come from Shares. If we raise that amount we will require a commercial mortgage and/or other loans for the balance of £120,000 which will get us to the £250,000 required to purchase the pub and make some essential repairs.
A community purchase of the Rose and Crown will help to safeguard a place to meet friends, neighbours and improve the sense of belonging and community.
* It best reflects the ethos and community of Slaley
* It is the easiest way for us to publicly sell shares in the business
* An increasing number of pubs and other businesses in Britain, both buyouts and start ups are being owned in this manner.
* There is a groundswell of movement and a lot of experience and advice out there.
We estimate that a total of £350,000 will be required to purchase the property and put it back into fit for purpose good condition. A full refurbishment could be completed over a period of years, using various sources of income from loans, shares, future grant income and retained profits.
THE STORY SO FAR
A lot has happened since we decided to go ahead with the purchase and a lot of people have worked hard to make it happen!
Following a public meeting attended by over 50 residents in December 2012, a Steering Group was set up to manage the purchase of the Rose & Crown based around a business model that would help to make it a viable business for a manager to run in conjunction with the community for the long term.
To assist the development of a robust business case for investors and with pro-bono input from many professionals, Steering Group members have:
* Visited community-owned pubs in Cumbria and Yorkshire to understand more fully what is involved in setting up and running a community-owned pub.
* Set up and registered an I&PS (co-operative) “Slaley Community Assets Ltd” which will purchase and manage the Rose & Crown on behalf of investors and the community Had a dilapidations and structural survey carried out and renovations plans drafted and costed.
* Had a business valuation carried out by professional valuers. Applied for and received grant funding to help with professional fees – legal, tax, accounting, etc.
* With the support of the Parish Council, registered the R&C as an asset of Community Value. This means that its use can be protected so that it cannot be changed subsequently (to residential for example).
* Are in the process of recruiting an appropriate manager who will have autonomy to manage the business on an open book policy and with oversight from the co- operative directors.
We continue to receive professional, financial and legal advice both local and from large North East firms
THE BUSINESS CASE RATIONALE
We believe that this project represents a once-in-a-lifetime opportunity to secure the vibrancy and sustainability of our village and the surrounding area.
* The Rose and Crown, prior to its sale to a brewery was a very successful pub and restaurant.
* It had regular customers, high restaurant utilisation and a high rate of bedroom occupancy.
* Since brewery purchase it has suffered from rapid changes in tenancy and managers.
* It has recently operated under restricted hours with no food or accommodation on offer.
* It remains, however, a key and well-loved village asset.
* We are confident that as a “good food at fair prices” pub it can regain lost custom and return to profitability.
* We have had access to the trading results of the most recent Tenants. We are basing our assessment of turnover, overheads and profitability on the income in their start-up year.
* It is also a building which could in the future incorporate a shop and café.
* This has been supported by information from, Pub in the Hub and from industry ratios.
* We plan to at least break even in the first year and hope by the second year that we will be able to generate sufficient profit to pay interest on the shares in the region of 2.5%-3.5%.
* This will be worth more to taxpayers who qualify for EIS relief. (It is for individual investors to ascertain if this will be available to them. Full details of this scheme can be found on the EIS Association website or from HMRC).
For more information, please have a look at the Slaley Rose and Crown Business Case (.pdf)