Music Venue Trust (MVT) has set up a Charitable Community Benefit Society (CCBS), named Music Venue Properties (MVP), to help grassroots music venues by purchasing freeholds.
MVP will then be able to lease the properties back to operators on a “friendly lease” with reduced rents and make contributions to insurance or repairs, as well as offering rent breaks for unprecedented events.
Because a CCBS is different to a traditional charity, it can raise money through community shares. By purchasing these shares, live music fans and investors will raise funds to allow the newly-formed MVP to purchase freeholds, while also receiving a 3% APR return on their investment.
MVP has identified nine venues for a pilot project to establish proof of the concept. Six venues are in England, two are in Wales and one is in Scotland.
The hope is to raise £3.5m (€4.1m/$4.4m) to purchase these venues and associated venues, with the view of buying the venues before the end of 2022.
MVT said that the CCBS will continue to “identify and purchase venue freeholds as and when they become available” and the MVP will raise funds through selling community shares and borrowing against the freehold purchased.
The rent received from the pilot venues will be reinvested, meaning MVP will be able to expand its portfolio.
MVT said that 35% of grassroots music venues have closed in the last 20 years and that 93% of grassroots music venues are tenants. The average operator has 18 months left on the tenancy.
MVP launched the crowdfunding campaign today, and at the time of writing has raised £129,400 from 19 individuals.
Image: John Matychuk on Unsplash