In this financial article I will discuss the financial value of the Boleyn ground land and what might become of it after we move to Olympic stadium.
West Ham originally rented Green Street House and grounds from the Roman Catholic Church from the early 1900’s. This land was later sold by His Eminence William Cardinal Godfrey and the Catholic Church to West Ham United Football Company Limited on 5th August 1959.
In the May 2012 West Ham accounts the value of Boleyn ground is listed at just over £71m but this is not it’s true value, this is just the value of the replacement cost as a football stadium or the possible value if there was a market for 35,000 seat football stadiums which there is not.
We all know in reality the stadium will be knocked down and the land would be sold for redevelopment. In the latest West Ham accounts the value of the Boleyn ground land together with our various training grounds is listed as just over £16m for auditing purposes.
The true re-sale value depends on planning permission from Newham council but we know the council are keen to regenerate the area in a similar way that happened around canning town. Some valuations range from £20m to £30m but it will depend on market conditions and what planning permission will be granted for the land.
Arsenal converted its former stadium Highbury into 711 flats and raised £157m from property sales but a development in East London is unlikely to get anywhere near that.
In 2010 the club placed adverts in trade magazines seeking “expressions of interest for the stadium as a development opportunity” after the 2012 Olympics.
It was widely rumoured that a supermarket and affordable residential flats were planned but as we now know the deal collapsed with the collapse of the first Olympic stadium bid.
The idea to bring a large supermarket and flats to the area is nothing new.
In 2006 it was reported that Asda together with developer St Modwen put forward a £50m scheme to demolish the historic Queen’s Market and build 130 flats next to its new superstore. Asda later pulled out of the controversial development after 12,000 signatures were gathered to oppose the plan by a group called Friends of Queen’s Market.
David Sullivan has an impressive property portfolio himself which is now his main source of wealth. This portfolio is owned under his property company called Conegate Holdings Ltd which has property assets worth over £240m. He owns ‘a huge Sainsbury’s’ that pays him £3million a year in rent as well as a ‘couple of Marks & Spencers’. Just the buildings, you understand, which the retail giants rent from him. Conegate also owns shops, offices and residential properties across the UK. They also own 12.5% of West Ham United through a share holding in WH Holdings Ltd and made loans to West Ham’s holding company of £16,850,000 at an interest rate of the base bank rate plus 5%.
I am sure it is just a complete coincidence that West Ham value their land at £16m in their latest accounts which is almost the identical amount owed to West Ham by Sullivan’s property company Conegate holdings.
I must stress this is just my own personal speculation but I could see a scenario where this same property company which owns 12.5% of West Ham with a track record of owning supermarkets bids, buys, develops,owns and subsequently rents property on the land that was once our home for many years. Not that there would be anything wrong with that you understand. It would be a good business decision in my opinion by someone who might be sympathetic of it’s long history.