Hopes for a new ice arena in Plymouth threaten to melt after the Covid pandemic pushed the expected operator’s withdrawal and construction costs soaring.
The long-awaited ice rink is slated to be built on land adjacent to Plymouth Argyle’s Home Park football stadium, but the company behind The Mayflower Ice Arena project says it is now struggling to make the project financially viable.
HHP Nominee Ltd, of which the sole director is former Argyle chairman James Brent, insists the project has not been abandoned but at the moment there is a huge loss threatens to build which means uncertainty is growing and it needs to be re-evaluated options .
The planned 1,500-seater arena was well on its way at the beginning of 2020. Construction is to begin this year on a 40,000 square meter building between the renovated stadium grandstand and the Life Center sports complex.
But that was before the Covid pandemic hit the UK, causing lockdowns and subsequent problems for the construction industry. Contracts to build and operate the new ice arena were finalized within days of being signed when the pandemic hit those shores.
For the long-term rental of the Mayflower Ice Arena, an agreement was made with a large leisure provider on the terms. The property owner, HHP Nominee Ltd, has agreed to pay for the construction of the “shell” of the building under the proposed agreement, and the operator has agreed to assume the substantial cost of equipping the ice arena.
But on March 13, 2020, just three days before the government ordered the first lockdown, the operator “understandably” informed HHP Nominee that in view of the Covid-19 pandemic and the resulting uncertainty, it was not ready to step in at this point in time in the lease for the arena. However, it remained interested in discussing the possibility of getting back on board once the effects of the pandemic became clear.
In the meantime, a separate contract to build the arena, also essentially agreed between HHP Nominee and the selected contractor, had to be put on hold following the proposed operator’s decision to withdraw.
A spokesman for HHP Nominee said Covid-19 has had a significant impact on recreational businesses and ice rinks across the country have been closed for most, if not all, of most, if not all, since March 2020.
This means that HHP Nominee is currently not confident that the operator is ready to enter into a lease on the terms previously expected.
In addition to the loss of the proposed tenant, which affects rental income and also the financing of expansion costs, construction costs across the UK have risen significantly since the outbreak of the pandemic and investment values for comparable leisure properties have fallen significantly.
HHP Nominee said this has created a “viability gap” which means the project is causing a very large loss as things stand. However, the spokesman stressed that the company is doing everything in its power to address the problem and has not given up hope for a solution.
He said, “There is now a significant void in the viability of the arena. HHP Nominee continues to investigate and review all reasonable options on how to fill this profitability void in the hope that the Mayflower Ice Arena can still be delivered. “
Business Live’s South West Business Reporter is William Telford. William has over a decade of experience reporting on the business scene in Plymouth and the South West. It is based in Plymouth but covers the entire region.
Keep in touch: BusinessLive newsletters have been redesigned to make them even better. We send morning bulletins straight to your inbox on the latest news, views and opinions in the Southwest. Get our breaking news and weekly industry reviews too. Register now – it’s free and only takes a minute. To subscribe to Business Live’s daily newsletters, click here
And visit the Business Live South West LinkedIn page here
The Ice Arena project has been a request from Mr. Brent and the City since 2012 when one of Mr. Brent’s other companies purchased the pavilion site from Plymouth City Council.
A condition of this deal was that he had to provide the city with a new ice rink. The project received full planning permission on May 19, 2019. The construction of the arena on Mr. Brent’s company property in Home Park would enable the future development of the pavilion area, which in the past could include hotels or even a cinema.