Fears of Leeds training ground house sell-off - Guardian 15/12/04

Guardian Unlimited Football | News | Fears of Leeds training ground house sell-off Fears of Leeds training ground house sell-off Matt Scott Tuesday December 14, 2004 There are fears that houses may be built on a portion of Leeds United's training ground within the next five years. The Guardian has seen a document relating to the property interests of the club which suggests that should planning permission be received in the next five years a developer could erect houses or offices on the valuable land close to Wetherby. Over the past six months the club has completed the sale and leaseback of its Thorp Arch premises, dividing the land into three separate tranches: the Grange, the Barn and the first-team training pitches. When the club was considering the last of these deals the proposed lease made specific provision for development. In the event of the development going ahead, Leeds's tenancy on the first-team training pitches at Thorp Arch would be terminated. "The landlord has the right to end the lease on three months' prior written notice to the tenant if he obtains planning permission for the redevelopment of the whole or a substantial part of the premises during the first five years of the [25-year leasehold] term," the document states. The Guardian has not been able to establish whether the lease for Thorp Arch was finalised in these terms, as the document has yet to be lodged with the Land Registry. When we raised the issues relating to the lease with the Leeds United chairman, Gerald Krasner, he declined to answer our questions. Last night he reiterated that he had no comment to make. Obtaining planning permission for the Wetherby land may not be difficult. Leeds City Council's unitary development plan was revised in August 2003 to promote the conversion of the Thorp Arch area into a Strategic Housing Site under central government's push for brownfield developments. The area, in a region north of Leeds known as the "Golden Triangle" that includes Wetherby and Harrogate, is highly desirable to property developers. Even if no planning permission is granted, according to the report Leeds's right to remain on the first-team training pitch would expire in October 2029, since the relevant lease is non-renewable. In the event of Leeds having to leave the site around the first-team training pitches, they would be left with just the academy buildings at Thorp Arch Grange and the sports complex facilities known as Thorp Arch Barn. Though it was initially reported that these had been sold to and leased back from the Manchester-based property developer named Jacob Adler, as part of a wholesale purchase of the entire site, the report states that one of the tranches is owned by another landlord. David Newett, a businessman from Wetherby, apparently bought the Thorp Arch Grange portion of the training ground in July this year, three months before the board stated its intention to sell the site. There is a clause in which the club undertakes to support any planning application made for the Grange for a period of 50 years to 2054. Though the club's finance director Melvin Helme declared at the time of the October sales that Leeds would benefit from "a satisfactory buy-back clause", there may in fact only be an option to do so for the Barn area of the training ground. When contacted yesterday, Helme also declined to comment. The impact of the Barn sale is further compounded by the fact that the club could exercise the buy-back option only until October 2009. If the club were to choose to exercise the buyback a premium of between £1m and £1.6m on the initially reported £4.2m sale price is envisaged. In the meantime, Leeds would pay more than £11m in rent for the barn site to Adler's company and a further £4.1m to £4.5m to Newett for the Grange over the next 25 years. The obligation for the higher-level payments would arise if Newett were to buy Elland Road by March 31 next year, though there appears to be no current plan to do so. Leeds fans last night expressed concerns at the implications of the sale. "I'm concerned that something with far more value that was achieved has been signed away for good," said John Boocock, the chairman of Leeds United Supporters Trust. "In supporters' minds this also raises questions about the sale and leaseback of Elland Road." The circumstances of that transaction - also carried out between the board and Adler's company Barnaway - are at present opaque. The registration documents for Elland Road sales have also yet to be lodged with the Land Registry. It is understood that Leeds are also committed to paying about £180,000 per year in rent for land at Elland Road transferred to the casino operators Stanley Leisure for £5.2m in October. The club's subsidiary company, Leeds United Retail Ltd, will only be released from their obligation to continue paying rent if the casino development goes ahead. Should Stanley - or another casino firm - pursue the development, Leeds stand to make up to £9.825m, though the government has recently reduced the number of casinos that it expects to license under the new Gambling Bill. Leeds's board has already reduced the club's debts from £104m, where they stood at the time of the Adulant Force takeover in March, to less than £25m, assisted by the £20m secured in sales of land and property at Thorp Arch and Elland Road. Yet despite this influx Leeds still have some pressing debts to honour, including an imminent £1.2m payment to the Inland Revenue. "Because of the way football is run, we are not allowed access to information," said Boocock. "In Leeds's case, because the club is a private company, it is difficult for fans to know who owns what. "In this day and age, as principal stakeholders in a club, we expect far more. We need more transparency, and if that means parliamentary legislation is required, so be it."