Kassam Stadium rent deal 'stifles' United

Oxford United chairman Kelvin Thomas at the Kassam Stadium

Oxford United chairman Kelvin Thomas at the Kassam Stadium

First published in U's News Banbury Cake: Photograph of the Author by , Business Editor. Call me on 01865 425460

OXFORD United chairman Kelvin Thomas has described an agreement to rent the Kassam Stadium as stifling.

Mr Thomas spoke to the Oxford Mail about the finances of the Blue Square Premier League club, and about his determination to break even after years of accumulating debt.

In 1999 former chairman Firoz Kassam bought the club, inheriting £18m of debt and a half-built stadium.

But while he built the Ozone leisure complex at the ground, his business principles did not translate to success on the pitch.

When new owners Woodstock Partners took over, under the guidance of former United youth team player Nick Merry, there was a new ray of hope for the team but Mr Kassam’s £13m price tag on the stadium proved too high for a purchase to be agreed.

In October last year, Mr Merry stepped aside as chairman, although he remains co-owner with Ian Lenagan, and director Mr Thomas moved into the hotseat.

Mr Thomas has found himself with a quarterly £120,000 bill for the rent of the stadium, and until recently Mr Kassam collected all the income from advertising and conferences, which left just gate receipts and sponsorship money for the club.

Mr Thomas said: “The licence agreement certainly stifles our ability to generate income.

“We have improved things off the pitch and we’re getting more success on the pitch.

“One of our goals is to generate income and not just have it based around winning, although clearly it’s easier right now.”

The club also has a debt of £4m according to its last accounts, some of which is historical, although the money is owed to Woodstock Partners, rather than any outside institution.

Additional income has come from the sale of former player Dean Whitehead, who moved from Sunderland to Stoke.

United benefited from a sell-on clause which meant they collected 25 per cent of the fee for Whitehead’s £3m move to the Britannia Stadium, minus the £325,000 they sold him for to Sunderland five years ago – a total of about £670,000.

Partly as a result of that revenue, Mr Thomas is confident the club will break even this year, breaking the trend of a £1m annual loss over the past four years.

He also cut expenditure wherever possible and is determined to build up new income streams after setting out a pre-season series of success factors, including bigger crowds and cup runs, to get the club back into the black.

New incentives include a membership club, launched last week, where people can receive discounts with local and national companies such as Pontins, Butlins and the RAC, in exchange for a £30 annual fee.

It is hoped the scheme will raise about £100,000 a year.

The 12th Man initiative, where fans raise cash to boost the playing budget, has also been successful, raising enough money (an estimated £20,000 by January) to finance new permanent squad members Jamie Cook, from Crawley, and loan signing Onome Sodje, from Barnsley.

Promotion to League Two next season would guarantee up to £1m in extra income.

Mr Thomas is also keen to develop links with the business community and fill executive boxes on matchdays.

He added: “We want to make sure everyone in Oxfordshire is talking positively about us.

“We don’t want sponsors, we look for partners.”

Comments (15)

Please log in to enable comment sorting

3:02pm Thu 10 Dec 09

BigAlBiker says...

I know the current owner saved the club but apart from Oxford Utd who else is going to pay that extortionate rent? If they left he would have an empty stadium on his hands.

I would also look for a wealthy company (oxford uni) to purchase the stadium and have the naming rights, and hopefully use it to its full potential allowing the club to reduce the costs it already has.
I know the current owner saved the club but apart from Oxford Utd who else is going to pay that extortionate rent? If they left he would have an empty stadium on his hands. I would also look for a wealthy company (oxford uni) to purchase the stadium and have the naming rights, and hopefully use it to its full potential allowing the club to reduce the costs it already has. BigAlBiker
  • Score: 0

4:35pm Thu 10 Dec 09

dave from witney says...

Kassam might have saved the club, but he certainly lined his pockets on the way out. The high rent is out of proportion and presumably Nick Merry was a bit too desperate to take over the club, that he agreed to such a high rent. Hopefully after this season we will get that extra revenue, at the moment we can only hope that the great job that Kelvin is doing, will soon bear fruits .
Kassam might have saved the club, but he certainly lined his pockets on the way out. The high rent is out of proportion and presumably Nick Merry was a bit too desperate to take over the club, that he agreed to such a high rent. Hopefully after this season we will get that extra revenue, at the moment we can only hope that the great job that Kelvin is doing, will soon bear fruits . dave from witney
  • Score: 0

4:45pm Thu 10 Dec 09

Joe Cooke says...

They would of made some more money if they would of put some effort in at Barrow, only one team really wanted it and it wasn't Oxford.
They would of made some more money if they would of put some effort in at Barrow, only one team really wanted it and it wasn't Oxford. Joe Cooke
  • Score: 0

5:04pm Thu 10 Dec 09

zorba the geek says...

Dave from Witney

Me thinks you are wrong in regards to Merry and the rent.

The rent was agreed between OUFC and Firoka Stadium Ltd (or something like that) when we first moved from the Manor. It was a legally binding agreement already in place and any buyer would have had to abide by it. And as much as I dislike Kassam, it made sense for him to not change the terms when selling the club.
Dave from Witney Me thinks you are wrong in regards to Merry and the rent. The rent was agreed between OUFC and Firoka Stadium Ltd (or something like that) when we first moved from the Manor. It was a legally binding agreement already in place and any buyer would have had to abide by it. And as much as I dislike Kassam, it made sense for him to not change the terms when selling the club. zorba the geek
  • Score: 0

5:22pm Thu 10 Dec 09

Joe1 says...

This always comes back to haunt O.U. In these difficult times, Kassam must be rubbing his hands. As stated so many times, he looked to have saved the club, but the truth be known, he just took what he could from ALL the sales & his developments around the stadium. He does NOT have any love for the club. He kidded us along the way, it was just a tool to make money. I suppose as a hard nosed wealer & dealer, you can't blame him. I wish KT & the board all the very best & hope & prey we can get away from Kassam in the not too distant future.
"COME ON YOU YELLOWS"
This always comes back to haunt O.U. In these difficult times, Kassam must be rubbing his hands. As stated so many times, he looked to have saved the club, but the truth be known, he just took what he could from ALL the sales & his developments around the stadium. He does NOT have any love for the club. He kidded us along the way, it was just a tool to make money. I suppose as a hard nosed wealer & dealer, you can't blame him. I wish KT & the board all the very best & hope & prey we can get away from Kassam in the not too distant future. "COME ON YOU YELLOWS" Joe1
  • Score: 0

5:32pm Thu 10 Dec 09

hughcurran says...

sadly only a rich branson type figure could ever afford to buy the kasstad & that aint gonna happen! this is going to be our nemesis i fear for many years to come, so sad but true im affraid....
sadly only a rich branson type figure could ever afford to buy the kasstad & that aint gonna happen! this is going to be our nemesis i fear for many years to come, so sad but true im affraid.... hughcurran
  • Score: 0

7:42pm Thu 10 Dec 09

tolpuddle martyr says...

Is there a banker around with some bonus money to buy the stadium, but there again I suppose they would want even more rent.
Is there a banker around with some bonus money to buy the stadium, but there again I suppose they would want even more rent. tolpuddle martyr
  • Score: 0

5:20am Fri 11 Dec 09

peter mcvey says...

The answer is simple really, we share with Oxford City for a quarter, give the Dark Knight nothing in rent and see if he is willing to let the stadium go to rot or not.
The answer is simple really, we share with Oxford City for a quarter, give the Dark Knight nothing in rent and see if he is willing to let the stadium go to rot or not. peter mcvey
  • Score: 0

6:35am Fri 11 Dec 09

Atomic says...

When Kassam came on the scene he promised O.U.F.C lots and delivered us little yet made millions for himself.
If he has any decency what so ever he would say I have raped this club for long enough making a fortune along the way and give us the fans back our club.
Lets see if he has any humanity in him. B
Before I get a lecture on business, yes I realise he needs to make money, but that is not the promise he came in to this club with.
Prove to us and the world you are not just a nasty little con man and do the right thing.
When Kassam came on the scene he promised O.U.F.C lots and delivered us little yet made millions for himself. If he has any decency what so ever he would say I have raped this club for long enough making a fortune along the way and give us the fans back our club. Lets see if he has any humanity in him. B Before I get a lecture on business, yes I realise he needs to make money, but that is not the promise he came in to this club with. Prove to us and the world you are not just a nasty little con man and do the right thing. Atomic
  • Score: 0

7:23am Fri 11 Dec 09

Roger Casement says...

How depressing that week after week the most interest is in the most trivial part of any news-football. Frankly, who cares?
How depressing that week after week the most interest is in the most trivial part of any news-football. Frankly, who cares? Roger Casement
  • Score: 0

8:32am Fri 11 Dec 09

Joe Cooke says...

Suooprt your local team Roger!
Suooprt your local team Roger! Joe Cooke
  • Score: 0

10:15am Fri 11 Dec 09

wallingford1 says...

end of the day...it's a business....and a business needs to make money to survive. Rent was agreed a long time ago when money was flowing and bums were on seats rather than invading the pitch. Maybe OUFC could share with another team, like Swindon Town? 8)
end of the day...it's a business....and a business needs to make money to survive. Rent was agreed a long time ago when money was flowing and bums were on seats rather than invading the pitch. Maybe OUFC could share with another team, like Swindon Town? 8) wallingford1
  • Score: 0

5:46am Sat 12 Dec 09

peter mcvey says...

Seeeming that Kassam made his fortune out of our tax money (housing illegals in his london hotel at £100+ per night) morally he should do the right thing and give something back.
Seeeming that Kassam made his fortune out of our tax money (housing illegals in his london hotel at £100+ per night) morally he should do the right thing and give something back. peter mcvey
  • Score: 0

7:14am Sat 12 Dec 09

Atomic says...

A couple of the above comments show the apathy that crawls through some people, statements like "who cares" and share with S-----N show maybe you should reconsider where you go on Saturdays.
The hard facts are, yes business needs to make money, but the time time comes to look at how the business makes it.
If Mr Kassam has any decency in him he will say to himself I lied to those people and in doing so made a fortune, and now here is something back.
Well Mr Kassam what are you made of.
A couple of the above comments show the apathy that crawls through some people, statements like "who cares" and share with S-----N show maybe you should reconsider where you go on Saturdays. The hard facts are, yes business needs to make money, but the time time comes to look at how the business makes it. If Mr Kassam has any decency in him he will say to himself I lied to those people and in doing so made a fortune, and now here is something back. Well Mr Kassam what are you made of. Atomic
  • Score: 0

8:33am Sat 12 Dec 09

Vestan Pance says...

Why do you OUFC suppoerters keep hoping Mr Kassam will do the right thing? It's obvious he never will, he only cares about making money. However as an asset, the stadium really only has one potential tenant, OUFC. Find somewhere else to play, or make serious your plans to do so and he will potentially have an empty stadium on his hands, not only not generating any money but also costing him money in security and maintainance (the London Dome cost millions to keep empty until O2 took it on). Anything at all has only a value that someone else is prepared to pay, and the Kassam is only wanted by one party so it's rentable value is surely what that party is prepared to pay and nothing more. Come on OUFC strap a pair on and force his hand!
Why do you OUFC suppoerters keep hoping Mr Kassam will do the right thing? It's obvious he never will, he only cares about making money. However as an asset, the stadium really only has one potential tenant, OUFC. Find somewhere else to play, or make serious your plans to do so and he will potentially have an empty stadium on his hands, not only not generating any money but also costing him money in security and maintainance (the London Dome cost millions to keep empty until O2 took it on). Anything at all has only a value that someone else is prepared to pay, and the Kassam is only wanted by one party so it's rentable value is surely what that party is prepared to pay and nothing more. Come on OUFC strap a pair on and force his hand! Vestan Pance
  • Score: 0

Comments are closed on this article.

Send us your news, pictures and videos

Most read stories

Local Info

Enter your postcode, town or place name

About cookies

We want you to enjoy your visit to our website. That's why we use cookies to enhance your experience. By staying on our website you agree to our use of cookies. Find out more about the cookies we use.

I agree