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Leeds United want city council to help buy back Thorp Arch
Leeds United have asked for cash from the city council to help buy back the club's training ground for £5m.
United sold the Thorp Arch training facility in 2004 and an option to repurchase it expires on October 10.
The club has rented its training ground since the sale to Manchester property developer Jacob Adler by the Leeds board fronted by former chairman Gerald Krasner.
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While the club is keen to buy Thorp Arch, it has – according to a Leeds City Council report – been unable to borrow enough money because of the recession and its poor credit rating after administration in 2007.
United bosses have asked the council for help and senior councillors will next week consider two options:
Give the club a loan with the council taking a charge over Thorp Arch to insure itself against the risk of the club defaulting on payments;
Buy Thorp Arch and lease it back to the club. United would buy the training ground from the council once it had enough money.
The report to be considered by the council's executive board next Wednesday says the cost of buying the land and building a similar training facility has been estimated at more 15m – thre times the option buyback cost.
It adds: "While this would not, in itself, protect the council's financial position, it is important in reassuring members about the scale and quality of the facilities under discussion."
The report, which recommends the council start discussions with the club, says there is much due diligence to be done before an agreement could be struck.
The council would have to satisfy itself that the club had no other means of funding the option to buy and had the means to pay the annual rent.
Councillors could choose to do nothing in which case, says the report, Leeds United could continue to occupy Thorp Arch until 2029 "at an increasingly penalistic rent" which could slow the club's recovery.
The report suggests there are a number of good reasons for supporting the club including its value to Leeds in its quest to be viewed as a major European city, a successful Leeds United means more television exposure for the city and the risk that, without council help, Thorp Arch could be lost to the city.
Thorp Arch has eight full-size grass pitches, two all-weather pitches, reception, cafe, changing rooms, indoor swimming pool, hydrotherapy and physiotherapy facilities and gym.
In February 2007, a few months before the club went into administration, it was revealed the council had granted United "hardship relief" against its business rates – saving the club 134,000 during the financial year. Three-quarters of the sum was reimbursed to the council by the Government and council taxpayers met the rest.
The council has already provided cash help to Yorkshire County Cricket Club. It used its prudential borrowing powers to lend it money to buy its Headingley ground.
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Wednesday 08 February 2012
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