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Friends Plan for Hastings Pier May 2018

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Friends Plan for Hastings Pier May 2018 Friends Plan for Hastings Pier May 2018 CONTENTS Executive Summary 1. The Core of the Plan 1.1. The Assets we have 1.2 The Threats we face 1.3 Protecting the pier for another 150 years 1.4 Our USPs 2. A Big, Bold Vision for the Top 2.1 Underlying Themes 2.2 Re-visualising the Pier 3. Transition: how do we get from here to there? 3.1 Running a Tight Ship 3.2 Governance & engagement 3.3 Keeping the pier open – the meanwhile offer 3.4 Human resource review 3.5 Operations & logistics 3.6 Implementing Phase 2 4. Financials 4.1 Transition financials – understanding the scale of losses 4.2 Capital requirement – achieving Phase 2 4.3 Steady state financials – commercial sustainability & growth 4.4 Financing strategy 4.5 Social capital – people and relationships Appendices COMMERCIALLY CONFIDENTIAL © Friends of Hastings Pier 2018 1 Executive Summary Friends of Hastings Pier (FOHP) was re-established in Feb 2018 to be an independent voice for community shareholders and supporters of Hastings Pier, in the face of Hastings Pier Charity (HPC) going into administration. Active and constructive volunteers have been working on a number of fronts, including developing this Friends Business Plan for the Pier. We propose a new charitable community benefit society (FOHP Trust) to purchase the pier and all of HPC’s assets for £1 from the Administrators. We hope to bring many of the 5,000 HPC community shareholders with us alongside new supporters and, with a new elected board of trustees, to oversee the implementation of a clear and fundable recovery plan. At the heart of our proposal is the separation between a guardian freeholder and a commercial operator. The freeholder would be responsible for the upkeep of the structure in perpetuity, costed at £230k pa index-linked. This will be achieved through a full commercialisation of the ‘top’ (deck and above). This model of separation is used by several piers nationally, including Bournemouth and Cromer. Our suggestion is that Foreshore Trust becomes the ultimate freeholder and awards a 150- year full repairing peppercorn lease (a ‘virtual freehold’) to FOHP Trust who would, in turn, lease ‘the top’ to a commercial operator. This arrangement spreads risk appropriately, allocating the commercial responsibility to the operator, the delivery responsibility to FOHP Trust, and the long-term ownership responsibility to a stable charity that already owns all the rest of the foreshore. In order for an operator to achieve revenues that could pay a rent to the virtual freeholder the pier will need to increase footfall, dwell-time and average spend per visitor, requiring new infrastructure and a different management approach. The People’s Pier project was always phased. Phase 1 [Renovation] aimed to create a stable platform, stable ownership and an interim business model that, with HLF grant alongside for the first few years, could sustain the pier while investment was raised for Phase 2 [Revitalisation]. Somehow this plan got lost along the way. But we do have a stable and beautiful platform and lots of learning from the first two seasons. FOHP has developed a detailed but indicative business proposition for Phase 2, showing how ‘the top’ can generate enough revenue to pay a rent to cover the costs of maintenance and insurance. This anticipates completing the new infrastructure within 3 years of taking ownership. Our Transition Plan shows how we will use that interim period to raise footfall and dwell-time, diversify income sources and maximise local usage, while preparing and delivering the capital project. That investment can bring the Pier up to sustainable commercial operation generating 10%+ gross profits while protecting the freehold, preserving the structure, and ramping up the community benefit. We aim to prove that the future of Hastings Pier can be both community and commercial… COMMERCIALLY CONFIDENTIAL © Friends of Hastings Pier 2018 2 1. The Core of the Plan 1.1 The Assets we have We have a beautiful 150+ year-old Eugenius Birch pier, which is famous for having been saved against all the odds by sustained local community action. Following the substantial grant from Heritage Lottery Fund (along with grants and investment from Architectural Heritage Fund, Coastal Communities Fund, Communitybuilders, and others), the work of Hastings Borough Council to achieve compulsory purchase, and the personal investment in community shares by nearly 5,000 individuals, the pier structure has been renovated to create a stable platform for the future. Above deck, dRMM won the Stirling Prize for their community engaged and sensitive designs in creating ‘the UK’s Best Building 2017’. As well as the renovated pier itself, there is the great human asset of Hastings. Many thousands of people have been involved in the 12 years since the pier first closed in 2006 and new people are bringing their skills, expertise and passion ever day. There is very strong good will towards the pier. This crisis has galvanised the Hastings community again. The plan continues to be developed in full transparency, our team of experienced and credible commercial advisers continues to grow, and over 470 people have donated so far to our crowd-funder appeal. 1.2 The Threats we face We are concerned about the potential sale of the freehold of the pier to a private owner. Of course there are many responsible and entrepreneurial owners, but as the ‘Campaign Against Delinquent Ownership’ project has shown, there are also hundreds of examples all over the country of precious buildings stuck in difficult private ownership. While the pier may start in responsible ownership, there will be no protection against it ending up in the hands of delinquent owners and history repeating itself. The imperative of private enterprise is the pursuit of profit and the minimisation of cost – with a pier it is easy to take money off the top and fail to put it in underneath. Eventually the underneath rots; in the worst cases the private gamble is to make sure you took enough out in the good years and then sell the liability off shore. A freehold sale to a private owner is not the only alternative. There is no reason why the freehold can’t be separated from the operation – as with, for example, both Bournemouth and Cromer piers. COMMERCIALLY CONFIDENTIAL © Friends of Hastings Pier 2018 3 1.3 Protecting the pier for another 150 years A great deal of effort, time and money went into the rescue of Hastings Pier from the former private owner who had left it to rot and burn. We do not believe ‘the Panamanian situation’ should ever be allowed to reoccur. We are concerned that a freehold sale would not only gift very significant public and community investment to facilitate direct private profit, but would put the pier at increased risk of disinvestment in future. The very least that should be done is a covenant on any future owner that requires them to provide an annual Maintenance & Repairs Report to Hastings Borough Council who would either sign it off or not, and make it public. If the council has refused to sign it off because inadequate for 5 consecutive years there is a reversionary interest and the freehold is passed to HBC/Foreshore Trust. We believe the pier freehold, and therefore responsibility for the ‘bottom’ (ie the structure) should remain in community ownership in perpetuity, which is both more responsible to the public good and less risky for a commercial operator. 1.4 The USPs of community ownership • Massive community engagement and support • Access to public and charitable funding • Track record and demonstrable support for community investment • Creative and collaborative approach, making use of all the assets available to us • Distinctive and distinguished team who are making significant pledges of free time • ‘Happy ending’, good PR for all concerned COMMERCIALLY CONFIDENTIAL © Friends of Hastings Pier 2018 4 2. A Big, Bold Vision for the ‘Top’ In order to prove that the top can sustain the bottom and thereby attract operator and investor interest, we have developed an indicative business proposition. This treats the pier as similar to a cruise ship or a resort, with intensive entertainment and event programming and an active hosting team ensuring that all visitors a) have a good time and b) have every opportunity to spend money. While animation can increase footfall and dwell-time fairly quickly, average visitor spend will only rise with significant investment in infrastructure facilities. This section describes an exciting and realistic vision of how Hastings Pier could become a profitable, sustainable attraction, while responsibly protecting the freehold for future generations. The Creative Content has been produced by Adam Wide through an ongoing creative strategy development process with Friends of Hastings Pier. See slide-deck. The Emerging Designs have been prepared by dRMM as part of their £60,000 donation of architects fees to take us as far as planning permission. See slide-deck. Both content and design will undergo further revisions during the Transition period. 2.1 Underlying themes A. JOYLAND: 21ST CENTURY FUN Traditional approaches with a 21st century twist. Exciting, forward-looking, breath-taking. Tests of strength, tests of skill, prizes. Modern take on an old tradition. o Modern Carousel – commission an artist to develop the vehicles (recycled/reclaimed material? steam punk? Quentin Blake?), same music, different feel. o Ask Grayson Perry to design an Aunt Sally stall, other artists to do similar – reimagine the fairground. (see Adam Wide list of traditional fairground items for inspiration) o Emotional content – storytelling, carnival, hobbies. Events team turn these into formats on the AIDA basis (Awareness, Interest, Desire, followed by a call to Action).
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