Kinnon Park Update

Financial Position

You will see from the 2006 year end accounts that we enjoyed a much improved trading year, in the main due to increased subscriptions from our membership offers, coupled with a much improved performance over the bar in the second half of the year, following the return of Trevor and Irene. Our other income streams remain critical to the ongoing viability of the club, and once again visitor income is down 50% on a poor 2005.

Your Board of Directors remains convinced that the only viable long-term option for the Club is to continue with the move to Kinnon Park. Our priority in the immediate future is to continue the fantastic progress made in the latter stages of 2006, building a stable membership base, which will provide the foundation of our new venture at Kinnon Park.

Update from Development Sub Committee

Some time has passed since our last update and while there is little tangible to report, the lack of fresh information or communication only leads to speculation, assumption, rumour and general frustration all round! We would like to take this opportunity to update and take stock of what we have been progressing on your behalf:

Appointment of GS Brown as our Development Partner.

The EGM in 2005 approved the appointment of GSB as our preferred development partner. Your development sub committee (Tom Reddie, Alf Beattie, Alan Davidson, Barry McKenzie and John Wright) have continued regular dialogue with GSB and our legal advisors to work towards a legally binding framework, which will deliver the best interests of the Club. The likely outcome will be the formation of a new Joint Venture Company, which will be responsible for the sale of land at Craigie Hill and the overall control of costs. This company will consist of 4 directors 2 from the Club and 2 from GSB. Craigie Hill will maintain a majority shareholding and hence control of this new company. The original deal to appoint GSB involved a non-refundable option payment of £60k giving the developers 3 years to progress the planning/development process on completion of a legally binding agreement. GSB have provided a £60k interest free loan for the time being, taking the strain off our cash flow.

Planning Process for Housing Development at Craigie Hill

As previously communicated, Housing at Craigie Hill has been recommended for inclusion in the Draft Local Area Plan. The frustration is that the Plan needs to be adopted by the full Council, which will now not happen until after the local elections in May 2007. Circumstances have certainly been out with our control with the goal posts being moved regularly. However for the time being we have no option but to follow the Local Plan route.

In the meantime, GSB have progressed a full survey of the Hill and architects have recommended suitable areas for housing. These plans also suggest the best access route to service these development areas, which in reality will involve the formation of a new access road crossing the allotments at Low Road. A plan of this suggested layout along with a photo montage of what housing would look like is available to view at the Clubhouse along with an extract of the report from the Enterprise and Infrastructure Committee meeting of 28th June 2006. I would stress at this point the plan is only an architect's proposal and may not meet with Councils approval.  The bottom line is we need approval for approximately 30 acres, or thereabouts, to make the whole project viable.

Access to the site at Craigie Hill

As previously mentioned, another potential obstacle involves providing a “clean” access to Craigie Hill. The existing access road is unsuitable for a development of the scale proposed, so the only option is the formation of a new road, crossing the allotment gardens adjacent to Low Road, claimed to be owned by Dupplin Estates (our neighbouring landowner). Searches by Land Ownership Scotland have proved inconclusive as to where the clear boundaries of ownership lie, so therefore no “clean” access can be established. If this issue cannot be resolved, every potential house buyer at Craigie Hill would have problems getting clean title to their property. In an attempt to resolve this matter, we have firstly asked Dupplin Estates to provide Clean Title to the land they claim to own and secondly we have sought the opinion of a Professor of Law, well regarded in Land ownership matters whose opinion is likely to satisfy interested parties. This “access” dilemma also raises the potential of compensation to the owner of the “ransom” strip of land. This ransom could be in the region of 30% of the “net” uplift value of the development site. In order to facilitate this requirement, it is likely that Dupplin Estates would be invited to join in with the Joint Venture Company. This potential cost has always been on the radar and has been included in the financial viability projections.

Planning Process for Golf course Development at Kinnon Park

Outline planning permission for a 27-hole golf course and facilities has already been secured by GSB for Kinnon Park. Many of you will also be aware that GSB also have permission for a steading conversion and housing around the Kinnon park farmhouse. This has always been transparent and remains entirely separate from our requirements. GSB and your sub committee have been canvassing prospective golf course designers for costs and potential layouts for the golf course at Kinnon Park, with a mixed response, the idea being that once we have the green light for the Craigie Hill development we will be able to move quickly in appointing a course architect/designer. The joint Venture company will assume responsibility for all decisions affecting the new course and all costs will be entirely transparent. During the development phase, as agreed, all costs will be borne by GSB while we continue our golf at the Hill. When the new course is ready the joint Venture company will then be in a position to sell plots of land at Craigie Hill, which will ultimately reimburse GSB for the development costs. This arrangement through the Joint Venture structure ensures that members’ interests will always be best served. We will benefit from potential increases in land values, we ensure that plots are sold at true market value and clean title and ownership of the new course is guaranteed. The new course at Kinnon Park will be owned outright by CraigieHill Golf Club (1982) ltd.
At this point, it would also be prudent to discuss the potential name for the new course at Kinnon Park. Your sub committee and Board have assumed that “Kinnon Park” has a certain ring to it and see this as a suitable name for our new course. If any members have any alternative suggestions, please let us know, bearing in mind that we would wish to avoid any reference to “hill” for obvious reasons.

Summary & Conclusion

We hope this goes some way to reassure you that your Sub committee and Board continue to act in the best interests of the Club and on your behalf are actively pursuing all avenues to secure the long term future of the Club.

Any questions or suggestions should be addressed to the Club Captain.