26 April 2012

Capital my dear fellow, Capital

The people's library, bookshop, cafe is a possibility

Mr Mustard had to look at the library strategy earlier and he fell over this paragraph which sets out how the money will be raked in, in order to spend it elsewhere in the budget.

Capital implications:

Disposal of four assets could contribute to a capital programme required to fit-out
new buildings and remaining sites:

Child’s Hill = £960,561
Church End = £964,047
Friern Barnet = £432,527
North Finchley = £593,000
Total: £2,950,135

When Mr Mustard saw the low value of Friern Barnet library he had an idea based upon his second career of house refurbishment. The library is only worth the price of a semi detached house in Chipping Barnet.

Now Mr Mustard knows that Friern Barnet is not the most prosperous of wards but he did see some fine houses in the side roads and those flats in the former asylum were not cheap so there are people with money tucked away in Friern Barnet.

So the idea is to find 50 people with £10,000 of spare cash each who want to join together to buy the building and then to have a café (an outside terrace in summer on the lawn?), a library and a bookshop within the building. Mr Mustard is assuming that there are 3 rooms within the building but there might only be two large ones which could be sub-divided. Volunteers could run the library and the bookshop area could be let to a professional, as could the café area both at reasonable rents. That would enable the investors to get a small annual interest payment of about the rate of inflation, currently 3.5%. If the £10,000 investments were arranged as debentures or shares they could be sold on at par and there is always the security of the building to underpin the investment.

Now comes the clever part; the exit route. One day (maybe as soon as 2014 - who can say) a more enlightened and more cultured council will be appointed and the council could have the library sold back to them at the market price. If they see it has been a success they could perhaps leave the bookshop and café to continue and expand the size of the building to make more room for the library.

Mr Mustard thinks that the existing administration won't mind; all they want is the capital receipt now. If they sell the property to a property developer who wants to knock it down and build flats there will be a fight. Mr Mustard's way, they avoid the extra bad publicity.

This would be a win/win solution. Everyone would gain something.

Mr Mustard expects that in Friern Barnet there are book loving solicitors, architects and accountants who could form a company and get cracking. Mr Mustard has no great connection with Friern Barnet otherwise he would be the first in the queue with his money. What he will offer is that if you get stuck at 49 investors, he will be the 50th to make sure the scheme gets off the ground.

Yours frugally

Mr Mustard

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