Quote: Obadiah "Hull FC have a legally binding agreement with the SMC. The SMC has a legally binding lease with Hull City Council. Hull FC have user rights at the KC but no tenancy agreement, hence no legal rights as tenant. That is according to Hull City Council in one of their papers to the Scrutiny Committee.
As far as I know Hull FC's agreement with the SMC is similar to Hull City's. Its based on a percentage of gate receipts which is why Hull City pay more.
If the lease is revoked by Hull City Council they become landlords and the agreements with the SMC for both City and FC become worthless. New agreements with both clubs have to be agreed and put in place. The market rate for the stadium hire per game will be more or less the same for both clubs unless the Allams agree to pay substantially more.
I doubt many solicitors would have predicted the behaviour of Assem Allam.
I doubt whether many Councillors are looking forward to becoming landlords of the KC. They may be hoping that the Allams will back down and put the Airco back into its previous condition.'"
I agree the council have little appetite to run the stadium, they set up the SMC in the first place to have a cost-neutral third party custodian, foregoing a share of the income generated for the avoidance of cost and hassle of running it themselves. They found a reasonable partner in AP, but didn't future-proof the arrangement. The deal looks like it's similar to the one they struck with Hull KR when they repurchased the freehold of New Craven Park to allow Rovers to avoid folding, then set up a peppercorn lease with Gaingroup who sublet to Rovers. I'm not sure of the split of cost ownership between Gaingroup (now KCD) and Hull KR, but KR get all the stadium revenue and pay for maintenance, stewarding etc. Essentially it looks like all the clubs are rent free, courtesy of the council? It would seem that costs at the KC are broadly allocated on gate receipts - you have, what, double our gates, twice as many fixtures and charge 50% more, roughly an uplift of x6