Lions’ tour to generate little for home unions
THE British and Irish Lions tour to South Africa, which due to the pandemic had to be played behind closed doors, will generate little if any financial upside for the home unions.
WRU group finance director Tim Moss said that a dividend from the summer tour, although figures have to be finalised, was expected to be “close to nil” as he also confirmed that following on from its new hotel the union’s next income generating capital project is likely to be a roof walk attraction at the Principality Stadium.
While figures have not been disclosed it is understood that from the Lions tour of New Zealand in 2017 the profit upside for the WRU amounted to several million pounds.
The summer tour to South Africa did generate a profit, but unlike in previous tours, the squeezed margin will be mainly used to support the company behind the Lions and planning for the next tour scheduled for Australia in 2025.
Mr Moss said: “We need to be clear on this, but I would be surprised if there is much by way of a return to the unions [ home] from the tour because it was so restricted due to Covid. The only rights available were broadcast and some sponsorship ones. There was no ticketing, hospitality or travel packages, which usually contribute a fair bit to the Lions.
“So, in terms of returns to the WRU I think we are probably going to be close to nil, once you take out all the costs of the tour, which would have been significantly more because of Covid.”
Next month the union’s new luxury Parkgate Hotel, next to the Principality Stadium on Westgate Street, is scheduled to open.
The joint venture with Cardiffbased property development firm Rightacres, has been financed with £45m of long-term repayable funding from L&G.
The union is confident, once the hotel reaches close to full occupancy, that it can generate an annual income of around £1m, after taking account of repayments to L&G and a management fee to the Celtic Manor Collection, which will operate it. The expanding portfolio of the Celtic Manor Collection includes the Celtic Manor Resort in Newport.
The union, which is expected to receive its first instalment from CVC Capital Partners following its investment taking a minority stake in the Six Nations by the end of the year, is now looking at its next income enhancing capital projects.
Like with the WRU’s share from CVC’s minority investment into what was the Pro-14 League, its share of around £50m from the Six Nations deal will be drawn down over a num
ber of years. While an interactive rugby museum has been identified as a possible project, a stadium roof walk attraction is now the current focus.
Mr Moss said: “A roof walk is a project that we are very keen to do. I think it makes sense as we obviously have the stadium in place already and we would be enhancing it with a new year round destination experience.”
He said the union is talking to a number of potential roof stadium walk operators, but stressed it was too early to say what margin such an attractive could generate – which would be impacted by the level of capital investment the union agreed to put in.
He added: “These are the conver
sations we are having, but we would almost certainly engage with somebody who has experience as this isn’t our expertise as we are used to running massive events on match days.”
Stadium and iconic building roof walks are growing in popularity globally. The O2 arena and Tottenham’s football stadium in London have them. A roof walk at the Principality would afford unrivalled views across the city and beyond.
As well as a roof walk there is also potential for a more adrenaline fuelled attraction like a high-speed zipwire.
While the union is not disclosing which firms it is talking to, Gwyneddbased Zip World, which specialises in adrenaline zipwires, and whose latest attraction at the former Tower Col
liery in Cynon Valley opened earlier this year, could be a potential partner.
On plans for a rugby experience interactive museum, Mr Moss said: “It is something we would like to do, but it is nowhere near as advanced as the roof walk.
“The challenge would be making it commercially viable as something like this needs a fair amount of up front investment and infrastructure.
“We don’t have the space in the stadium so we need floor space and that would mean a rental agreement.”
It is understood the union has looked at a number locations for a rugby museum, including the Stadium Plaza leisure scheme next to the Principality Stadium.