by Northern Git »
22 Dec 2009 23:56
Wycombe Royal Tamworth_Royal Sorry Strap can’t see where you coming Mate, the cost of a £17m Hotel making £500k a year that’s 34 years to make a profit, add to the £17m over 34 years repairs, refurbishment (Most hotels need total overalls after 5 years) then your adding years and years to the 34 years break even.
However the Premier League offers £30m minimum cash guaranteed every season( Christ knows how much 30 years on SKY will be paying, )…………sorry can’t see why an Ivory towers Chairman’s room / Hotel is a good investment.
Instant TV Revenue V Joe public Hotel room rates …………naaaaaaa
The hotel is making a profit in a recession, that is quite impressive and there is a big chance that the profits will increase as the economy grows again and companies lift travel restrictions and so on.
Yes you get £30m from being in the Premiership but the costs go up astronomically so you don't see much of that as a profit and if you want to give yourself a big chance of having that money every season then you will need to spend all that £30m and more on the playing squad and even then there is still a decent chance you will get relegated.
The hotel was a good investment as it provides another revenue stream for the club and one that has a lot more chance of happening every year and doesn't require massive investment to maintain it either.
By your thoughts every club should be making loads of money on the Premiership, but in reality...........
Is it? The last figures that are publically available that I am aware of do indeed show a profit, but they are from a period before the recession. They are also before the several new hotels in and around Reading came on stream.
My understanding is that room occupancy rates and resturant covers have plummeted at the MM hotel.
But, if you have published figures that show otherwise, I would be very, very interested to see them.
BTW the hotel does not provide a revenue stream for the club, but only for the holding company, into which both MM hotel and RFC Ltd's P&l figures are combined. I am not aware that any monies gererated by the Hotel have contributed in any way to the football club. Or perhaps you know better?