Could the Arms Park site form part of a much bigger regeneration scheme which could rival projects such as Central Square and Capital Quarter? Business Editor Sion Barry takes a closer look
THE redevelopment of the historic Arms Park site in the centre of Cardiff has been talked about for years.
But last December there was a positive step forward with an agreement in principle between tenants of the rugby ground, the Cardiff Blues, and landlord Cardiff Athletic Club.
While not disclosed, if a final agreement is reached, this would see the Blues providing an £8m payment to the Athletic Club, which is made up of its sporting sections of cricket, hockey, rugby, bowls and tennis.
And in return it would provide the Blues with a long-term lease up to 150 years, with the rights to bring commercial developments forward.
If you turned the existing BT Sport Arms Park stadium 90 degrees with a new arena it would open up the riverfront for residential development, with plenty of space also for offices and other commercial projects, including on the current bowling green.
But my sources at the Athletic Club say the Blues have not yet been able to come up with the payment, while their ebullient chief executive Richard Holland said that a number of options are being explored and he remains confident that a deal can be done.
But even if a deal is reached, there is still the challenge of a developer, perhaps this could be the club itself or working in a joint partnership, making a return on investment.
You could be looking at a cost of £30m before any new income generating apartment or office blocks are built.
A new 15,000-seater stadium, although you can build them more cheaply and assemble them on site these days like a huge jigsaw, could cost anything from £20m to £30m.
Then, if you add in planning costs and the £8m payment for a new lease with the Athletic Club – even if an agreement is reached so the £8m is not liable until planning consent is secured – the costs are considerable
And under the terms of a new lease the Blues would see a doubling in its current rent to the Athletic Club to around £200,000.
I know of one successful property development firm in South Wales which doesn’t think there is enough value in the site, after these costs are accounted for. Perhaps the Blues could try and get the Athletic Club to take far less than £8m in return for a stake in any future development.
But the Athletic Club could make a condition of any deal that a new stadium is built before any developer profit is made.
And while any scheme from the Blues would be considerable in scale - and there has been talk of potential investment from the Middle East - in terms of impact I believe it should be part of a much wider regeneration project for the centre of Cardiff.
Last year the then outgoing chief executive of the WRU, Roger Lewis, unveiled, although very much at a vision stage, plans to develop up to 240,000 sq ft of commercial developments on land the union owns around the Westgate Street main entrances into the Principality Stadium.
The project was dubbed Westgate Plaza
So why not create an impressive seamless development from the River Taff across the Arms Park site and incorporating the WRU land, to rival other schemes in the city such as Central Square, Capital Quarter and the Cardiff Waterside scheme in the Bay?
And let’s be honest the regions, including the Blues, now have a much better relationship with the new chief executive of the WRU, Martyn Phillips than they towards the end with Mr Lewis.
So, it would make sense for the Blues, Cardiff Athletic Club, Cardiff council and the Welsh Rugby Union, to set a working party to explore options. And as many funding pots still lead to Cardiff Bay, why not invite the Welsh Government too?
I know that the WRU and the council would be more than willing to sit around the table.
And for the union, could such a project open up the opportunity to did redevelop the only two-tier section of the Principality Stadium which adjoins the south stand of the BT Sport Arms Park?
Yes, they could decide that it would be better to develop in isolation, but if they did opt to pool land, vision and financial resources, I am sure there is a scheme to be developed that not only stacks up commercially, but with brilliant design would provide a new chapter in the city’s exciting regeneration story of recent years.