Here are some answers to common questions. If you don’t see an answer to your question please get in touch: bladoncommunitypub@gmail.com
What is a community pub?
A community pub is just as it sounds – a pub business owned and controlled by the community for the benefit of the community. Since the first community pub opened in the UK in 1982 there are now around 100 community pubs open and trading, several in Oxfordshire. To date, no pub that has transitioned to community ownership has closed.
How are community pubs funded?
Community pubs are typically funded through a public share offering allowing members of the community and other 3rd parties the opportunity to invest. There are usually minimum and maximum investment thresholds. All shareholders (or members) have a say in the running of the business on the basis of one-member-one-vote.
What the benefits of community ownership?
In many cases, community pubs have been established as a means to save pubs that were otherwise destined for closure. Frequently these are the last surviving pubs in the towns and villages they serve. As well as safeguarding the ongoing availability of a key service, the additional benefit of community ownership is that members may then have influence over the types of service provided by their pub. This may be related to the manner of the running of the pub, or the types of services on offer. For example, the facility may provide additional services, such as a community meeting place, café or local shop.
Why form a community pub, why not allow it to be privately owned and run?Aside from the obvious benefits of being to own and run the pub by the community for the community, there is always a risk that private investment may not be forthcoming. Over the last two decades more than 13,000 pubs have closed in the UK, with the land typically being sold for change of use, often ending up as housing. Once local pubs close they are lost for good.
Investment FAQs
Why should I buy community shares?
Your investment helps with the ongoing upkeep and improvements to the White House and to develop our financial reserves. It helps ensure the pub continues as a community asset for the long term.
Who will benefit from this project?
The residents and friends of Bladon will benefit directly from having a vital amenity preserved for future generations, both through the use of the facility itself but also because the White House will play a part in making Bladon a stronger, more vibrant, and cohesive community in which to live.
Is this a good business proposition?
We require the business to continue to be a profitable venture. We have carefully evaluated its strengths and weaknesses and our projections show that we can continue to establish it as a successful and thriving business. It is well proven that communities who work together to set up such an enterprise will support it in the future. There are 195 pubs run as community pubs in the UK. For copies of our financial reports email: treasurer@bladoncommunitypub.org
Who are the people behind this project? Do they have a personal interest?
The Management Committee consists of a group of local residents who care passionately about the White House and what it means for the community. They have no personal financial interest in the project, above and beyond their own investment in community shares. They have voluntarily contributed a large amount of time to the project, and this has been supplemented with advice and considerable support from many people and organisations including The Plunkett Foundation.
Who runs the White House and makes the day-to-day decisions about the business?
The Management Committee have appointed a tenant to manage the day-to-day running of the business. We work closely with the tenant to ensure that our vision for the White House is delivered, however we do not micro-manage the tenant and ultimately all decisions regarding the management of the pub and therefore all associated business risks will be the tenant’s.
Do my shares give me voting rights?
Yes, they do. Everyone has an equal voice, regardless of the size of their investment.
How do I get my money back?
Our rules do not allow you to withdraw your shares in the first three years. After that, you will need to give at least three months’ notice. We do not anticipate and have not budgeted for being able to allow any withdrawals before year 5. You cannot sell or transfer your shares, and withdrawals must be funded from surpluses or new capital raised from members. The Committee may suspend withdrawals depending on the long-term interests of the Society, the need to maintain adequate reserves, and the commitment to the community we serve.
Will I get my investment back if the White House fails?
All the business’s assets, including the freehold of the building, would be sold and the proceeds of the sale (after paying any creditors) divided between the shareholders up to the value of their shares. You might receive the full value of your shares back or you might lose part or all of your investment.
Are joint applications allowed?
Yes. However, you should note that only the first named investor on the application form will be a member of the Society with voting rights. If, for example, a couple would both like to be members then each person should make a separate application.
Can I invest on behalf of my children or grandchildren?
Yes, so long as you are a member in your own right, and provided the total amount invested does not exceed the maximum investment amount. You will only have one vote, as is the case for any member. The shares can be transferred to them as soon as they reach 16 years of age, just complete the relevant section on the second page of the application form.
What happens to my shares if I die?
Your shares will form part of your inheritance and can be transferred under the terms of your will. Make sure you complete the relevant section on the second page of the application form.
Why are there two types of share?
We are aware from feedback received that quite a few members of the community would like to make a philanthropic investment to ensure the future of The White House and are not concerned about receiving interest payments or being able to withdraw their shares in the future. Of course, there’s nothing to stop people making donations, but we decided to introduce ‘B’ shares so that people can in effect make a donation and also be members of the Society with a voice in how it is run. Both class of shares will be re-paid in the event of a sale of the property, as long as sufficient funds are available.
Can I buy both ‘A’ and ‘B’ shares?
Yes, a mix of share classes is fine. Just indicate on the application form how much you want to invest in each class and make the appropriate payment.
What are the minimum and maximum investment amounts?
The minimum that you can invest is £50 (i.e. one share at £50 each) although we hope that most investors will invest considerably more than the minimum. The maximum that can be invested in class A shares is £50,000 and the maximum that can be invested in class B shares is £100,000, which is the legal limit for individual investments in community benefit societies.
What redress do I have if the business fails, and I lose the value of my shares?
This share offer is unregulated, as it is exempt from the Financial Services and Markets Act 2000 or subsidiary regulations, which means there is no right of complaint to the Financial Ombudsman, nor can you apply to the Financial Services Compensation Scheme.
Will I receive interest from my shares?
We aim to pay a reasonable interest rate to our members however this will always be dependent on the success of the business. Interest will be paid gross and it is each member’s responsibility to declare such earnings to HMRC if appropriate.