Community purchase of the Plough and Fleece
Valuation of the pub
The valuation that underpins our negotiation strategy was informed by a Red Book Valuation. This is a formal process undertaken by MJD Hughes, a highly experienced expert who is RICS certified. The committee decided to have this valuation conducted before the start of negotiation with the present owner. The Red Book Valuation provided a range of valuations based on three specific scenarios;
- Valuation of the property, fixtures and fittings in the current condition with The Plough and Fleece closed / vacant.
- Same as point 1 but open for business and trading but at low trading performance.
- Same as point 1 but open for business and trading at an optimum level
The valuation range was between £250,000 and £350,000. The valuations in each scenario should be seen as a guide only for negotiation. An offer to purchase the facility within this range has been made.
In addition to the purchase price, there are also additional initial start-up costs that include professional fees, stamp duty and initial stocking. We have estimated this, together with the purchase price, to be within the region of £325,000. We have planned an additional amount to cover refurbishment costs/kitchen (£44,000), the creation of space for the shop and post office (£35,000), meeting place incorporating a cafe (£40,000) and outdoor space/garden (£16,000).
The total initial funding required is estimated to be £460,000.
Funding streams for purchase
This is planned to come from two primary funding sources ie. Community Share Offer and grant applications.
The first stage of funding is the initial community share offer, where we plan to raise between £200,000 and up to £250,000. Shares are valued at £25.00 per share with a minimum investment of one share (£25.00 per individual). A key purpose of this offering was to fund a major part of the initial purchase price of The Plough and Fleece whilst at the same time getting the local community engaged in the future of the Community Hub.
As shareholders, every member of the community who invests gets an equal vote on key matters surrounding the future of the Community Hub. This vested interest in the pub is seen as paramount to delivering on the business case.
The ‘Community Share Offer’ will be launched on 6th January 2025 and several activities and events to support this process are planned. We are currently obtaining pledges of support to the share offer and have initially obtained a commitment of £77,000.
The CVG have identified the government’s Community Ownership Fund as the main source of outside funding. There have been some awards that have benefited communities such as Cockfield. The CVG completed an expression of interest and submitted an application in April 2024. The CVG requested £345,000 for the capital purchase and £50,000 revenue support grant and a change in government has added to the delay in receiving the outcome. We found out in December 2024 that we were unsuccessful.
However, our Business Plan includes an alternative funding model. Many charitable organisations offer loans over long periods to support community projects and this will now be pursued. We have already made contact with Suffolk and Babergh Councils and are investigating small capital grants. The Royal Countryside Fund have also indicated additional support once the shop has been relocated.
Commercial loans are available from some lenders and we have identified some issuers offering preferential rates in support of community ventures. The CVG expect to pay interest of between 6% and 9% per annum. The CVG have modelled a 25 year loan with an interest rate of 7.75% in the hybrid funding projections.
Timescales and progress
Support received from James Cartlidge, MP
We are delighted to have received support from our local MP on this project, this can be viewed by clicking here
Cockfield Village Group Ltd.
Registered under the Co-operative and Community Benefit Society Act 2014
FCA registration number: 8863
We need your consent to load the translations
We use a third-party service to translate the website content that may collect data about your activity. Please review the details in the privacy policy and accept the service to view the translations.