For the community to purchase the site and design/rebuild the properties with a much smaller pub on site. This would also entail the construction of
two small cottages which would be sold either on the open market or to local residents at a reduced value for those in specific needs and subject to strict covenants.
As a community we are of an opinion that we would rather try and control our own destiny, rather than looking at a derelict property that we have endured over the past 6 years and we would like to develop this option with Waverley Borough Council.
The use of the car park would be a requirement for any new pub, which is Common Land and owned by the Lord of the Manor, Mr. Peter Herbert. In the past, this has been leased to either the owner or the licensee and we would have sole rights to the car park, if we were successful in re-opening the pub.
We are looking at an "enabling development" which will combine the re-opening of a much smaller establishment together with a village shop and two small cottages designed and built in the Arts & Craft style.
We have completed a business plan for a pub of this size and carried out local research in respect of the values of small residential units, which we understand is in great need within the Parish of Wonersh and further afield. As a small community it will be very difficult for us to raise the necessary finance and by selling the 2 cottages this will enable the community to own it’s own smaller pub. Profitability of the pub does not become a key issue due to the very low capital costs,
But to be quite clear our objective is to re-open a pub for the benefit of all the residents as a focal point for the community, which has been lacking for so many years.
"The Public House represents what should be the hub of our wheel of life, essential to our material need and second only to the Church that stands and represents our spiritual necessity. The Church is to the spirit as the Inn is to the flesh and, if good and well designed, they baulk the Devil himself" - Sir Edwin Lutyens
One option being explored by the pub committee is the setting up of a co-operative to purchase the pub. The committee has been taking advice from the The Plunkett Foundation who have been very successful in supporting a number of similar village enterprises (particularly small community shops - eg. Dunsfold)
The foundation would take us through the process of setting up a 'Community Benefit Society' (which would be completely separate from the Blackheath Village Society).
A CBS is membership driven with one member, one vote: This would be a non charitable trading entity with shares offered between £1 and £100,000 per member, which would attract full EIS tax relief at a minimum of 30%, up to a possible 50% relief. Share Capital would be at face value and is non transferrable with a possible small percentage of interest available to shareholders. This Society would be operated on a Limited Liability basis and is FCA registered. The main attraction to operating as a CBS is to tap into lottery funding which is available (£150 Million) as well as providing us with some very good opportunities for outside funding.
Outside funding is also available through Social Enterprise Banking Facilities like Resonance Ltd. They will provide sums of over £500,000 for enterprises such as ours which we will be looking into.
This website is an excellent resource for those wishing to know more about Pub Co-Operatives: http://www.pubs.coop/
Following receipt of a Notice of Intention to Dispose of The Villagers Pub in Blackheath issued by The Wellington Pub Group Ltd, The Blackheath Village Society (BVS) has written to Waverley Borough Council and advised them that we are an interested Community Group and wish to be treated as a potential bidder in relation to the sale of this asset. There is a moratorium period of six months from the date of notification, this being 24th November 2015, which provides us as a Community Group the opportunity to negotiate a deal to buy the freehold of the pub from The Wellington Pub Group. No other party, other than another Community Group, can negotiate a deal with the vendor during this period.
Fleurets, who act for the vendor, are marketing the property as a public house for £575,000 + VAT.
The original Asset of Community Value (ACV) was established in April 2013, as a majority of the village residents wanted to retain a public house in the village and in accordance with the Localism Act 2011, this remains in place for a period of 5 years.
It would appear that Fleurets are pitching the price to potential buyers who may be interested in developing the site for residential use as the quoting price is above the property’s current market value as a pub (and if there is a profit to be made, we should have this opportunity if the pub is commercially unsuccessful).
As the BVS is not registered for VAT purposes we will require a new company to register with HMRC for VAT purposes. Legislation will allow us to reclaim the VAT on the purchase price including costs and any VAT on renovations.
The Blackheath Village Pub Company Ltd commissioned Davis Coffer Lyons to carry out a valuation in 2012 and further discussions have revealed that the property is still valued at £300,000 as a commercial operation, which is similar to other pubs in the local area, with letting rooms and accommodation for staff/managers. As a Community Group we can enter into the bidding process, but this does not give us a right to buy the property. However, a third party cannot buy the property during the 6 month moratorium period. Any third party bidder would be subject to the ACV, would have an extensive amount of work to carry out and would have no control over the car park.
The intention of any BVS proposal is aimed at creating a vibrant and successful pub in Blackheath. We believe that a successful pub will be to the benefit of all villagers. However, we also need to cover the downside risk in the unlikely event that we cannot make the pub a success.
Estate Agents have confirmed that a local public house will increase the value of properties by approximately 5% in Blackheath. This has proved to be the case with The Three Horseshoes in Thursley, where house values have increased by up to 7%, when the pub reopened.
The Villagers Pub
FOR THE COMMUNITY, BY THE COMMUNITY
The BVS set up a crowd-funding site and has enabled residents to donate whatever figure they are comfortable with, as an unsecured loan towards our target figure of £15,000. We have now been successful and completed our objective of re-opening The Villagers Pub (all be it on a smaller scale). The loans will be repaid plus interest to all those who have supported the project at this early stage. Perhaps we will even arrange a special party for everyone who provides financial support at this early stage as well.
The BVS has also been encouraged and been successful in submitting £6,000 for funding from the proceeds of this year's May Day Village Fair.
We refurbish the main property and restore it to its original design, with future residential conversion in mind – to cover off the down-side risk.
Purchase Price: £550,000 (subject to planning).
Other expenses: £50,000
Development Costs: £550,000.
Stock/Fixtures & Fittings: £50,000.
Miscellaneous expenses; £100,000.
Net Profit: At least £100,000 pa (less professional fees)
To set up a VAT registered company to purchase the pub for £550,000 + VAT.
Invite up to investors to contribute £50,000 - £100,000 each to underwrite the initial purchase and the company to meet all VAT regulations.
Offer shares to the wider community to raise the additional funding and if necessary dilute the contribution from the original investors.
Our present objective is to repay the private loans once the two cottages have been built and sold. This concept will be developed further if and when we have the opportunity of buying the pub from the Wellington Pub Group.
Out thoughts regarding the projected end values of both the cottages are as follows and assume the Pub is Plot 1 at an estimated £150,000:
Plot 2 - 3 bedroom cottage
Given the approximate size of 1243 sqft we feel it would be appropriate to quote to realistic guide price somewhere in the region of £600,000 to £625,000. This equates to £482 per sqft at the lower end which would represent good value for money in today's market.
Plot 3 - 2 bedroom cottage
Given the approximate size of 1263 sqft we feel it would be appropriate to quote to realistic guide price somewhere in the region of £650,000 to £695,000. This equates to £482 per sqft at the lower end which would represent good value for money in today's market.