Ahead of next Thursday’s Dale Trust Fans Forum being held in the Ratcliffe Bars (Doors: 7pm Start: 7.30pm), the Board of Directors of Rochdale Association Football Club (“RAFC”) wish to set out factual circumstances of the lease of part agreed in March 2016 between the club and Rochdale Hornets, relating to matters publicised earlier today.
THE SAFETY OPERATION OF THE CROWN OIL ARENA:
RAFC as the legal owner is legally responsible for all events that operate at the stadium by any party. All events, including the hosting of Rochdale Hornets fixtures and/or any international fixtures operate under the RAFC safety certificate and therefore the responsibilities of the Board of Directors.
ENGLAND VS FIJI
Following an EGM on 1 June 2021 which removed two former directors from the Board of the club by shareholders, new Directors were appointed and, on appointment on 16 June 2021 as new RAFC Chairman, Simon Gauge commissioned a review of all property leases and commercial contracts that were already in place.
Despite a press announcement by Rochdale Hornets on 18 April 2021, during Covid-19 restrictions, that England vs Fiji was to be held at the Crown Oil Arena on 7 October 2021, no signed commercial agreement covering the safety certificate, stewarding costs, terms of use of the stadium or lease for use of the fixture was ever in place for any international fixture between RAFC, the RFL and/or Rochdale Hornets.
Signed commercial terms for the fixture were requested from Rochdale Hornets but could not be produced.
Any proposed international fixture is not covered by a 2016 Lease in place between RAFC and Rochdale Hornets, and RAFC has never had any commercial discussions with the RFL.
Due to Covid-19, the 2021 fixture was postponed on public safety grounds and rescheduled to 2022.
Following a request by the CEO of Rochdale Council to both parties to do our best to agree a commercial agreement which covered all safety considerations and in the spirit of a working relationship, Head of Terms for the international fixture were provided by RAFC to Andy Mazey and Steve Kerr of Rochdale Hornets in March 2022.
These terms were never accepted. Instead on 19 April 2022, Rochdale Hornets chose to launch a legal action under the 2016 Lease against RAFC relating to the fixture pre-action letter of claim sent in accordance with the Practice Direction Pre-Action Conduct and Protocols of the Civil Procedure Rules 1998.
That legal action was subsequently withdrawn by Rochdale Hornets on 21 June 2022, since as there was no commercial agreement ever in place to host an international fixture and that the fixture was not covered by the 2016 Lease, there was and is no obligation forced on RAFC to host an international fixture without full safety provisions being in place alongside due commercial compensation for all costs doing so given the safety certificate for the international fixture and thus responsibilities under it all fall on RAFC.
Rochdale Hornets confirmed to RAFC on 21 June 2022 that the fixture would not be proceeding at the Crown Oil Arena.
As the responsibility for safety falls on the Board of RAFC for an international fixture it is naïve and unacceptable to believe that any international fixture could have gone ahead without documented terms and conditions in place. It is regrettable that having offered fair commercial terms for the hosting of an international fixture, these were not accepted and instead legal action launched.
THE ACQUISITION OF FULL OWNERSHIP OF THE GROUND IN MARCH 2016:
The Board of Directors note that RAFC and Rochdale Hornets have successfully used the Crown Oil Arena together for thirty-four years since 1988 when following the sale of the Athletic Grounds in Rochdale, Rochdale Hornets first move to Spotland.
In March 1991, Denehurst Park (Rochdale) Limited was set up as a stadium management company to manage the significant annual costs of operating the ground saw RAFC jointly and collectively and Rochdale Hornets both own 45.45% of the shares in the stadium management company with Rochdale Council having a 9.10% holding.
In March 2016, RAFC privately acquired the shareholdings of both Rochdale Council and the Rugby League Facilities Trust in Denehurst Park (Rochdale) Limited which led to the Crown Oil Arena being owed 100% outright. The acquisition was widely welcomed by the then leadership of Rochdale Hornets, the Rugby Football League and Rochdale Council.
As consideration for privately acquiring shareholdings, RAFC:
- repaid in full £100,000 to Rochdale Council from March 1991
- agreed to repay all debts of the stadium management company to Rochdale Council in full. These amounted £529,000 and were to be repaid over nine years (to 2025) at a commercial rate of interest.
On 30th June 2022, RAFC announced that we had repaid the loan to Rochdale Council three years earlier than planned to secure the ground which alongside the associated protections of the Morris Resolution under RAFC’s Articles of Association and as an Asset of Community Value have secured protections on the ground for future generations.
THE GRANTING OF A LONG-TERM LEASE TO ROCHDALE HORNETS:
Agreed at the same time as the acquisition of the ground, the club entered into a long-term lease with Rochdale Hornets which was commercially agreed in 2016 and signed by the Board of Directors of both clubs of the time.
The purpose of the long-term lease was and is to guarantee Rochdale Hornets security of tenure for its home games but to also set clear parameters for occupation and cost liability.
The lease is only a lease of part and only permits occupation for Rochdale Hornets:
- For all official Rugby League fixtures involving Rochdale Hornets plus up to three friendlies per season.
- Of an Exclusive Space (allocated at the absolute discretion of RAFC) on Monday to Friday during the club’s normal trading times of 09.00 to 17.00, except for two hours before or one hour after any weekday football games involving RAFC.
- Of the Stadium for Matchdays involving Rochdale Hornets, subject to the operation of the ground’s safety certificate.
FIXTURE APPROVALS OF ROCHDALE HORNETS FIXTURES:
- RAFC has formal signoff on the Rochdale Hornets fixture list played at the stadium as part of the safety management responsibilities of the ground and the fixtures of RAFC taking priority.
- In the event of any subsequent fixture clash with RAFC being required to play a game at home by either the EFL or Television, RAFC can cancel any fixture to play with a payment to Rochdale Hornets depending on how much notice of the change is given.
DURATION, RENT REVIEW AND TERMS OF THE LEASE:
The current lease of part ends on 1st December 2039.
The annual rent of the lease of part to RAFC from Rochdale Hornets is £15,000 + VAT (£288.46 per week plus VAT), which comprises £11,000 + VAT for rental of facilities and £4,000 + VAT contribution for the cost of stewarding.
The first rent review under the lease of part is in March 2025 and then every third anniversary thereafter (2028, 2031, 2034 and 2037)
There is no ability for RAFC to break the lease before this date and nor would the Board of Directors want the lease broken given the 34 year association between the two clubs at the Crown Oil Arena.
Rochdale Hornets do have the ability to break the lease every two years by giving RAFC twelve months written notice and paying rent up to that termination date and vacating the property on or before that date. The next ability that Rochdale Hornets has to serve notice is on 1st December 2022 if they chose to do so. The Board of Directors do not anticipate that Rochdale Hornets will serve notice but that is a matter for them.
The annual rent of the lease of part to RAFC from Rochdale Hornets is £15,000 + VAT (£288.46 per week plus VAT), which comprises £11,000 + VAT (£211.54 per week plus VAT) for rental of facilities and £4,000 + VAT contribution for the cost of stewarding.
Rochdale Hornets are responsible for all stewarding costs for all their fixtures and at the end of every season a reconciliation is done to confirm that all stewarding costs have been charged and recovered by Rochdale Hornets. RAFC only recovers its costs in full with no profit.
MATCHDAY COMMERCIAL OFFERING:
All revenues and costs of Rochdale Hornet matchday ticket promotion, matchday entry and corporate hospitality are made by Rochdale Hornets directly and do not involve RAFC.
RAFC is obliged under the 2016 Lease to offer bar facilities and bar staff which it does in the 1907 Lounge on matchdays.
Unlike football matchdays where the Board of Directors choose a subsidised pricing model for our fan owned and fan-led club, there is no current commercial agreement in place with Rochdale Hornets which means matchday bar prices are on a standard pricing model.
GROUND AND PITCH MANAGEMENT COSTS AND PITCH RENOVATIONS COSTS:
Maintenance of the ground, pitch management and annual pitch renovation is all at the cost of RAFC with no contribution by Rochdale Hornets other than the £11,000 rent.
The cost of maintenance of the ground, pitch management and annual pitch renovation cost RAFC over £0.4m per annum.
SUMMARY
We trust that the above sets out clearly and fully the detailed arrangement from 2016 Lease which is in place which runs to 2039 and predates all current Directors of both RAFC and Rochdale Hornets and look forward to welcoming fans to the Crown Oil Arena on Saturday 30th July for our opening EFL League 2 fixture against Crewe Alexandra (3pm kick-off), on Sunday 31st July for the Rochdale Hornets vs Swinton Lions Betfred League 1 fixture and on Thursday 4th August for the Dale Trust fans forum.