Planning application submitted for Racecourse redevelopment
Newbury Racecourse plc (the “Company”), the racing, entertainment and events business, today announces that it has submitted detailed planning proposals for the racecourse redevelopment work that forms part of the major ongoing development project across the whole site.
As reported at the Company’s recent Annual General Meeting, the residential development on site continues to make very good progress, with most of the Western Area construction now complete and more than 200 homes occupied. The next phase of residential development in the Central Area, which will see the construction of 360 apartments, is due to commence later this year. The new access bridge from the north of the site is well advanced and is expected to be open in time for the three day bet365 Festival, featuring the Hennessy Gold Cup, in late November.
Significant progress has also been made on the racecourse infrastructure improvements, funded by David Wilson Homes as part of the land sale agreement. The new main public car park at the Eastern end of the racecourse is virtually complete and the new nursery and stable staff hostel buildings are due for completion at the end of this month, with the new Estate Yard already opened.
The Board has completed a detailed review of a number of potential improvements to the racecourse infrastructure, to be paid for by the Company, with the intention of refreshing certain key facilities for racegoers and other stakeholders to re-enforce the Company’s position as one of the UK’s leading racecourse and events venues. These works are focused on enhancing the racing experience at the same time as generating improved financial returns for the business in the long term.
These proposed racecourse infrastructure development works (“Infrastructure Enhancements”), which are estimated to have a total cost in the region of £20.0 million (and would be paid for by the Company), include:
• A new west entrance and Horseman’s Club facility, with a bar for owners and trainers and a dining area and patio, which will double as a new events venue on non-racedays;
• Two new entrances to create a more attractive and customer-friendly arrival experience;
• A new, more modern administration office immediately above the Horseman’s Club;
• A new pre-parade ring with new saddling boxes adjacent;
• An expansion of the existing parade ring to include a completely new winners enclosure within the parade ring, enhanced viewing for the public and improved facilities for television broadcasters;
• Repositioned pavilion suites on the site of the existing saddling boxes;
• Landscaping around the grandstands;
• Refurbishment of the Berkshire Stand and Pall Mall building to provide improved facilities for both racing and conference customers
Subject to planning consent being granted, Phase One of the Infrastructure Enhancements (with an estimated cost of £13.5 million) would commence in January 2016 and be completed over a two year period.
The total proposed Infrastructure Enhancements outlined above, at an estimated total cost of £20.0 million, if fully undertaken by the Company, are more extensive than the previously proposed Racecourse Refurbishment Works as set out in the circular to shareholders dated 29 October 2012 (then estimated to cost £12.0 million). The Board considers that the revised programme of works will provide improved prospects for growth in the underlying profitability of the core business activities and are therefore in the best long term interests of shareholders. At this time the Board has committed to progress Phase One of the Infrastructure Enhancements only, at an estimated cost of £13.5 million.
It is the Board’s intention to review the timing of Phase Two of the Infrastructure Enhancements (which have an estimated cost of £6.5 million) in 2018, when there will be greater visibility of the likely financial returns from the residential developments.
It remains the Board’s intention to return capital to shareholders, as and when the residential developments at the racecourse generate cash receipts for the Company in excess of its expected required capital funding for the infrastructure improvements that are now planned and the company’s operating finance requirements. Given this, it is now not anticipated any such distribution would be before 2018 at the earliest.
Note: Outline planning permission for a 120 bedroom 4 star hotel remains in place from the originally approved application in 2010, but there are no immediate plans to commence work on this part of the project.