Park: Is It Viable?
Over the past ten years our opposition to the Horkesley Park proposal has only become stronger. It is our belief that we have demonstrated how the proposal goes against local and national Planning Policy. We are supported in this judgement by the reports published by CBC’s own Strategy Policy and Regeneration group, and also by their appointed consultants, Nathaniel Lichfield and Partners and Savill Bird and Axon.
These grounds are so strong that we believe it would be hard for any planning committee in the country to grant planning consent. The only grounds on which a planning committee might conceivably be persuaded to view the proposal more favourably – in these straitened times in particular – would be those of the potential for job creation and for local economic revitalisation. It is our contention that such a view would be profoundly mistaken: that the Buntings’ Horkesley Park concept and business plan are clearly flawed, and that the jobs they claim Horkesley Park would create are mostly an illusion.
It is crucial that we, and anyone evaluating the proposal, give consideration to its viability before accepting any of its claims.
If planning consent were granted, would Horkesley Park achieve its objectives?
Or might it fail? The consequences of such a failure are potentially even more disastrous for the surrounding area than Horkesley Park itself.
The Business Case for Horkesley Park is set out by Buntings in the Tourism section of their submission prepared by Sykes Leisure Projects. In this they contend that Horkesley Park will attract 485,000 visitors in its first year of operation and that the average spend per head (for every single person visiting the site including children and babies) will be £27.65. On these two figures is the whole business case built.
Number projections have been questioned by a number of expert
The Council’s Strategy Policy and Regeneration (SP&R) Department in their report of 2011 concludes that “the estimate of 485,000 visitors annually is extremely ambitious and implies that the proposal would instantly capture an equivalent market to Colchester Zoo. The Zoo has taken a number of years to build up its market and further more has an easily understood theme in contrast to the complicated mix at Horkesley Park.”
Visitor Attraction Consultants in their report of 16th April 2009 consider that visitor numbers would be somewhere between those of Castle Howard (200,000) and Shugborough (100,000).
Budenberg Eddis in their Report of April 2009 analyse Horkesley Park in comparison with similar attractions and conclude that the highest possible visitor numbers would be 170,000 per annum.
Sykes have to use a two hour drive time – people coming from as far afield as Kent and Kings Lynn – to derive their visitor numbers of 485,000. Yet they make reference to the expert opinion of Anian Leisure Consultants who state that the majority of visitors would travel less than one hour in each direction. The Sykes conclusions have to be highly suspect - particularly given that there is no compelling attraction at Horkesley Park that would bring people from far and wide.
Spend per Head figures have been questioned by Visitor Attraction Consultants and Budenberg Eddis and have been analysed in comparison with other similar attractions. Budenberg Eddis conclude that an optimistic spend per head is closer to £15.00 per head and Visitor Attraction Consultants are even less optimistic than this. At the very least, the Buntings–Sykes figure of £27.65 is highly questionable. It would mean that a family of four would spend over £110 for a single visit – which is hardly credible.
Using the Sykes figures, Buntings show a projected net profit of £1.2M on sales of £13.4M. However this does not take into account the additional cost of providing free bus services as demanded by Essex Highways in their report of November 2010 and which would be enforced by law as an obligation on Buntings through a Section 106 Agreement. Savill Bird and Axon in their report for Colchester BC point out that this would cost in the order of £500k per annum. This would reduce the net profit to less than £700k per annum – far less than that required to finance the investment of £24M quoted by Buntings.
Using the Budenberg Eddis figures, and assuming the levels of employment proposed by Buntings, the project will make a net loss of £6.1M before taking into account transport costs. Clearly this would have to be mitigated by the employment of far fewer people.
Budenberg Eddis point out that spend per head would only have to fall by £2.50 for the project to become loss-making even using the Sykes/Bunting assumptions on visitor numbers.
Nathaniel Lichfield conclude that the tourist elements of the Scheme would make a loss of over £2M per annum and that the Scheme is dependent on sales of at least £9M of retail sales to make a modest profit. They state that this would be wiped out by a mere 13% reduction in visitor numbers to 422,000 and/or reduction in revenue per visitor. They do not take into account the additional cost of providing free transport which would make the situation even worse.
The Application is silent on how the project would be financed but Budenberg Eddis state that potential lenders would have regard to quite stringent downside scenarios in testing the business case. They do not believe that the projections being put forward would stand up to any reasonable level of scrutiny/due diligence.
Buntings state that the business case has been tested by their banks and financial advisors but they offer no evidence whatsoever for this.
The rational conclusion must be that Horkesley Park as proposed by Buntings is not financially viable. As a result, the claims for job generation of 155FTE jobs on site as stated by Buntings cannot possibly be substantiated.
The Nathaniel Lichfield
report, the Savill Bird and Axon and the SP&R
reports can be found on the CBC
website. More detailed comments
on these are give in our letter
of August 31st 2010 (pdf
151Kb) and Newsletter
of January 2011(pdf 140Kb).
In January 2011 Buntings submitted ‘Vision Statements’ further elaborating on their proposed Horticultural and Food Experiences, which can be found on the CBC website. It is our belief that the ‘Vision Statements’ are designed primarily to obscure the true retail nature of the plan, and that in the form in which they are described the Horticultural and Food Experiences would be commercially unworkable.