16th Jul 2020
Speaking to clients, we understand the difficulties facing the education sector, whether independently or state financed. Where capital funds had been confidently allocated prior to the COVID-19 outbreak, the uncertainties that now exist mean that it’s much harder to commit funding to new initiatives.
With the desire for first-class sporting facilities remaining, and many schools keen to provide new or upgraded pitches, we’ve researched the options and identified an effective funding solution.
Through strategic partnerships with leading providers of operating leases which comply with the ESFA Academies Financial Handbook, we can build or refurbish your pitch to FIFA Quality standards with your costs spread over a 5-7 year period.
Unlike capital funded projects, a sports operating lease allows you to spread the cost over time with flexible payments, and a much-reduced upfront cost. An added benefit is that your new pitch could generate revenue from facility hire to offset the cost of your repayments.
Football is an essential part of the curriculum and a key motivator for pupils at the John Madejski Academy in Reading. When their artificial pitch reached its end of life, they utilised a sports operating lease to fund the installation of a brand new FIFA Quality 3G artificial surface. Read the case study to see how the pitch pays for itself and helped to drive student admissions.
“On balance paying £50-£60k per year on an operating lease represented better value than paying upfront costs of around £270k – £300k…and the income generated from pitch rental offsets the repayments”
David Maine, Director of Estates and Facilities, White Horse Foundation
Like most finance agreements, operating leases allow for a purchase to be made (in this case a new or refurbished pitch) with the cost spread over time.
With an operating lease, you can spread the cost out through fixed-interest payments over a period of up to 7 years, with a fraction of the cost up front.
Payments can be made annually, quarterly or semi-annually to suit your needs. At the end of the lease period, you can either acquire the assets through a final payment or extend the use of assets over future years.
The average cost to construct a new-build 3G artificial turf pitch to FIFA performance standards, with fencing and floodlighting, will fall between £600,000 – £700,000* depending on the site, ground conditions, and specifications.
The average cost to resurface an existing pitch to the standards described above would fall between £200,000 – £300,000* depending on the site, ground conditions, and specifications.
The example below shows how an operating lease can be utilised to reduce up-front costs and accelerate the provision of important facilities for your pupils.
|Operating Lease (Annual in advance ex VAT)*
*Figures quoted were correct at time of writing (July 2020) and serve for illustrative purposes only. Please contact us to learn more and receive a detailed quote for your new artificial sports turf pitch.
In times of fiscal uncertainty, the ability to construct a new sports pitch – without committing significant funds up front – is a welcome relief for many schools.
An operating lease will free up your capital resources for other uses, while flexible, fixed-interest payments allow for painless financial planning.
With the cost spread over a period of years, revenue generated from facility hire can offset the cost of repayments – so your new facility could help pay for itself.
While the global situation has changed, it’s clear that life cannot be put on hold forever.
If you’re planning a new sports construction project, or your existing facilities are in need of refurbishment, now is the time to get your project underway.
Please get in touch with us to discuss your requirements and discover how we can help.