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Appeal No. VA94/3/011 AN BINSE LUACHÁLA Shelbourne Greyhound Stadium Limited APPELLANT RE: Stadium at Map Ref: 43a, South Lotts Road, Ward:
Pembroke West A, County Borough of Dublin B E F O R E JUDGMENT OF THE VALUATION TRIBUNAL By Notice of Appeal dated the 21st October 1994 the appellant appealed against the determination of the Commissioner of Valuation in fixing a rateable valuation of £1,000 on the above described hereditament. The grounds of appeal as set out in the said Notice of Appeal are that: The appeal was determined by the Tribunal on the 18th May 1995. The decision affirming the Commissioner's valuation was appealed by way of a case stated to the High Court and was remitted to the Tribunal for re-hearing. The appeal proceeded to hearing on the 4th September 1998. The Appellant was represented by Mr. Maurice Gaffney, S.C. instructed by Mr. Tom McGrath, Solicitor of T.P. Robinson & Co. Mr. Alan McMillan ARICS, an Associate of the Society of Chartered Surveyors and a Director of Donal O'Buachalla & Company Ltd., gave evidence. Mr. McMillan was accompanied by Mr. Noel Hynes, General Manager of Shelbourne Greyhound Stadium Ltd., who also gave evidence to the Tribunal. The Respondent was represented by Mr. Eamonn Marray, B.L. instructed by the Chief State Solicitor. Mr. Peter Conroy, District Valuer in the Valuation Office with 25 years experience in rateable valuations also gave evidence. A mention of the matter took place before the Chairman of the Valuation Tribunal on the 27th April 1998 where it was agreed between the parties that the written submissions as originally submitted would be used for the purposes of this oral hearing. Valuation History Material Facts Location Accommodation Ground Floor (b) Stand Conservatory 2. OFFICES Office buildings including bar and restaurant 4. KENNEL AREA 5. HARE TOWER AREA 7. CAR PARKING AREA The comparisons situated at Cork and Limerick which were assessed at £220.00 and £160.00 respectively were also mentioned. He stated that these were agreed figures. Mr. Alan McMillan was then called and gave a brief background to the
development of the Shelbourne Greyhound Stadium and its valuation history.
He referred to his written submission and stated that in arriving at a
fair valuation, he had examined the following issues. He said that attendances had been in rapid decline for the past 15 years.
Specifically he said the overall reduction from 1980 to 1993 was 64%.
In relation to the Tote he said that the total turnover had shown a reduction
from £3.87 million to £1.353 million over the same period,
that is, a 64% drop. Under operating Profit and Loss he said that net
losses for the four years up to the statutory valuation date were as follows: Mr Mc Millan said that this contrasts with a pattern of consistent if modest, profits for many years up to 1988. In relation to revenue, Mr Mc Millan said that the accounts showed a decline in real terms of 42% from 1980 to 1993. Mr McMillan stated that he had adopted the trading approach in an effort to demonstrate the decline in this sport and to reflect that there were technically no funds available for rent and rates and that it was evident that a material diminution in beneficial and rateable occupation, due to circumstances beyond the control of the appellant, resulted in the RV at issue being now and for some years past excessive and inequitable. Mr Mc Millan set out his valuation on a number of bases which are summarised in the Appendix. In analysing the trading accounts he stated that he was not suggesting that the property was not capable of beneficial occupation and not rateable but suggesting that a hypothetical tenant would pay rent but his opinion would be strongly influenced by the financial status of the company. Mr. McMillan used two comparisons, the Greyhound Stadia in Cork and Limerick. He stated that when the NAV was assessed on both tracks they were profitable entities. Both were assessed at a total RV of £380. They had the same attendance jointly as Shelbourne Park at the time but they accommodated 73% of the overall floor area in Shelbourne Park. The average rate per square foot in Cork was £2.30 and the average rate per square foot in Limerick was £1.28 whereas the RV proposed on Shelbourne Park is £3.50 per sq.ft overall. Mr McMillan was then cross examined by Mr. Marray. He stated that Cork had a brand new stand at the time of his assessment and would have been superior to Shelbourne Park whereas Limerick would have been inferior. Mr. Marray stated that Shelbourne stadium was perhaps the flagship of the racing industry whereupon Mr McMillan stated that it was the largest. When questioned about the market value at the time, Mr.Millan said he would regard it as a high value area if it was taken to be an apartment development site. However, this potential had to be disregarded for the purposes of NAV. He stated that he was relying on his comparisons and that he had reduced the overall rate on Shelbourne Park to reflect the size of the stadium as it was at least three times the size of Cork and Limerick. He accepted that the most valid approach would be the comparative method but that the backdrop must be the trading figures. He also stated that in assessing NAV he had allowed for the car parking in the overall rate adopted. He indicated that there were approximately 150 cars and that on race nights, a charge of 50p per car was levied. Other comparisons were mentioned including the ESB Sports Complex premises adjacent. This premises was described as a completely different building. It was also indicated that Punchestown Racecourse was used as a guide. It was confirmed that it was in a rural area and that the analysis used was not the analysis of the Tribunal. Mr McMillan also stated that he would not place much reliance on the National Basketball Arena. He also stated that the analysis of the Cork stadium was not agreed. Mr Hynes, General Manager of Shelbourne Stadium, then gave evidence. Mr Hynes indicated that he had only commenced as manager in 1993 whereupon he carried out market research. He stated that Shelbourne Stadium was the biggest of a bad lot and that the investment of £1 million only allowed a minimal upgrade and that the facility was appallingly poor. When asked whether there were any facts available to a hypothetical tenant which would give hope, he stated that the decline was really evident in the U.K. and was mirrored in Ireland where the market place held other attractions. Mr. Marray then cross examined Mr. Hynes who confirmed that the lack of investment caused some of the decline as the facilities were poor and it was difficult to attract customers. The industry survived on grants every year and it was hard to run the business. Bord na gCon wanted to keep the track going because of the breeding industry which employs over 20,000 people in Ireland. He stated that the Revenue from exports in 1993 was not available. He also stated that the property was held by Bord na gCon under a sporting lease from Pembroke Estates which restricted the use of the facility to sporting use. Mr. Peter Conroy, District Valuer, then gave evidence and outlined the
facts briefly described in his written submission, including the property,
its location, and accommodation. In Mr Conroy's written submission, he
pointed out that Bord na gCon was statutorily funded by: In exchange for the cash the Bord receives, the Bord distributes grants towards prize money and development costs. Shelbourne Greyhound Stadium Ltd is a wholly owned subsidiary of Bord na gCon. It holds the stadium without paying a rent or dividend. It has a drink licence, regulated by the Act. The only source of income is gate receipts, which are controlled by the Bord, catering profits, car parking fees, trials charges, sales commissions and grants. Mr Conroy stated that the involvement of the Bord in tracks, as an overall development agency for the industry, is a complicating factor. If all tracks were to survive unaided, only a few would survive, and as one closed, the viability of others would be enhanced. He stated that the low profits could be due to Bord policy and that losses made at the Stadium could be recouped by profits elsewhere in the industry. He stated that the location of this property was prime, close to the city centre and that although the buildings were old they served their purpose adequately. He approached the valuation on a traditional unit price using Cork and Limerick as comparisons but reflecting a premium for Dublin. He stated that Mr. McMillan's rates were low and he disagreed with a reduction for quantum. He had looked at the accounts and confirmed that they were of no assistance in assessing the NAV of the building but rather in assessing the business viability. He stated that Punchestown Racecourse as a comparison was put in as a guide and that Mr. McMillan's rates should be higher than this course as this is a rural area and should not be compared to Dublin. He also referred to the ESB Sports Complex. He stated that he had used a capital value as a function of rent and deduced from that what a rent could be. He accepted that the improvements completed did not greatly enhance the value. Mr. Gaffney then cross examined Mr. Conroy. Mr. Conroy stated that if the property were to be put on the market on the basis that it was to be run as a greyhound stadium it would affect capital value and agreed that it has to be taken as is. He estimated the capital value at £2.5m and in 1993 at a yield of 6.5% this would give an NAV of c. £162,500 p.a. He indicated that there was some confusion about the car park and that he thought there were approximately 250 spaces as there was in excess of 50,000 sq. ft. on site. He accepted that the spaces currently in use amounted to c. 180. Mr. Gaffney stated that the sporting lease requires a greyhound racing use and any deviation from that will not be acceptable to the landlord and that the property has to be devoted to sport. In that context, there would be no question of the car parking being leased out to the public as this would be a use for commerce and not for sport. Mr. Conroy stated nonetheless that the yard was of value and he did not think that Mr. McMillan had reflected this in his rates. He stated that the capital value of £2.5 m was modest in 1993. Mr. Conroy then referred to his comparative approach, he stated in relation to the Cork Stadium that his analysis was obtained from the old valuation file but that it was not agreed. Mr. Marray then summarised and asked that the Tribunal have regard to
the decision made in Trustees of Fitzgerald Memorial Park -v- Commissioner
of Valuation VA95/1/001. He stated that the approach adopted supported
the reasoning that where comparative evidence was available it must be
regarded as the most appropriate approach. Mr. Gaffney then submitted
that comparative evidence is the most compelling evidence and that the
assessment of £3.50 psf overall on Shelbourne Stadium is way in
excess of Cork and Limerick at £2.30 psf and £1.28 psf respectively
and that the economic factors submitted were mentioned only as an indicator. SCHEDULE OF SUBMITTED AREAS AND PRICES PER SQUARE FOOT Concourse 7,634 sq.ft. @ £3.00 = £22,902
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