Hopefully the following will answer any questions, queries, concerns you might have. If not, please feel free to contact the society.
If I buy shares, is my money safe?
The society is registered with the Financial Conduct Authority and is governed by their rules. All money received from investors is held in a ring-fenced account to be used solely for the purchase and refurbishment of the pub. Any administration costs incurred in the run up to the purchase will be funded by money specifically donated/raised for that purpose. If the society is not successful in purchasing the pub, the ring-fenced funds will be there to return 100% of shareholders’ investments..
What happens if the society is not successful in purchasing the pub?
If the society’s purchase of the pub does not go ahead, either because not enough funds have been raised, or the purchaser refuses to sell, 100% of shareholders’ investments will be return to them. Any money remaining, eg. From fundraising or donations, will be used for the benefit of the community.
What happens if the planning appeal is allowed?
If the planning appeal is allowed the applicant will be granted change of use to turn the pub into a residential property. Sale to the society is unlikely to proceed and 100% of shareholders’ investment will be returned to them.
What happens if the planning appeal is dismissed?
If the appeal is dismissed, change of use from a pub to a residential property will not be allowed. Furthermore, as planning will have been refused twice, and dismissed on appeal, further applications for change of use made by anyone within a 2-year period are likely to be dismissed on application. The owner will only be able to sell the pub as a pub. As the society appears to be the only party interested in retaining the property as a pub, it is hoped that the owner will consider the society’s offer more favorably.
Where is the money coming from to purchase and refurbish the pub.
The share offer is expected to raise a good proportion of the money needed. The remaining money will come from a combination of grants and loans from organisations such as The Plunkett Society, National Lottery, Local and National Government etc.
Why is the society looking to raise money before a purchase price has been agreed?
To negotiate the purchase, the society will need to have a good part of the funding required already in place. Before grant bodies will commit to provide funding, the society must be able to show that it has some, or all, of the remaining funds available. As indicated above, all money received from investors is ring-fenced so that, if the purchase does not go ahead, investors will receive 100% of their money back.
If the society is successful, who will run the pub?
The society has a management committee who will be responsible for the running of the pub. The management committee are all volunteers and will receive no remuneration for the work that they do. The society will employ a full-time, live-in manager to run the pub on a day-to-day basis. The work of the manager will be supplemented by a team of volunteers to keep operating costs to a minimum. As business and income increases, further paid staff will be employed. The services the pub is able to provide to the community will very much depend on the size of the volunteer team. The more volunteers available, the more services the pub will be able to offer.
When do you expect to buy and then open the pub?
The planning appeal is expected to be decided in August, after which the society will push to recommence negotiations with the owner. The society hopes to complete the purchase in November 2021, in which case the pub could be open and trading in February 2022.
What happens if the society buys the pub but the business subsequently proves to be unviable?
Clearly, the society expects the pub to thrive as a community business, otherwise it would not be putting in the effort to save it for the village. However, as with any business, there is risk. If the purchase goes ahead, the society’s members (its shareholders) will own the freehold property. If the business fails, the society will be able to sell the freehold to realise shareholders’ investment. Furthermore, because the society will have shown without doubt that the pub is not viable, change of use to residential property is much more likely to be approved, thus maximising the asset value. Once investors’ money has been returned, any funds remaining in the society will be used for the benefit of the community.