There are signs up all over Pembroke, telling readers about the regeneration programme in the town. Building works loom over the Royal George like an ogre after one too many, and there’s a general buzz of new – so far empty – retail units, a new holiday village in the old Gateway building and queues of Jesus’s fifty thousand outside Rowlies, clamouring to be fed with fishes.
There are a lot of other signs up in Pembroke too. For sale signs. Locally, Guy Thomas and John Francis are the most well known names in local history; their names are on a billboard on every second property all the way up both sides of Main Street. Most of these are commercial properties. For sale or to let. A lot of them are ex-banks. Yes, no longer can you see your bank manager, because he’s disappeared in a puff of candy floss. No cashpoints, because they don’t want you to use cash, not really. Cash is a bit too fluid. A bit too manipulable. What you need to be an admitted member of their new, shiny, technological society is capital. Lots and lots of capital.
I discovered this recently, whilst getting on a mission to see what it takes to get hold of one of these commercial properties, and turn it into a viable business. Let’s look first at planning permission, because we all know that’s my super favourite subject.
High street businesses come into separate categories. You’ve got yer basic retail. Then financial services etc, then cafes etc. Then there are others outside these groups, but for now I’ll focus on these. It’s not inconceivable that if you bought an ex-bank, you might want to turn the place into retail downstairs and flat upstairs. You might want to turn one floor into a shop and one into a café. In England, they relaxed the rules in order to encourage businesses to set up and to regenerate their towns and high streets. Basically, if the property is in the main business area, you can basically do what you want with it. Just open something up and make the street better please.
Can you do this in Wales?
In Wales, the categories are under an umbrella category. A1, A2 and A3. If your building is a bank it’s classed as A2. You can change this to A1 without planning. So you can have a shop and a flat upstairs. However, you can’t have a café, because that comes under A3. You can’t change from A2 to A3. You can change from A3 to A1. You can change from A1 to A3, but not if it started as an A2. By the time you’ve worked all this complication out you don’t feel like going into business anymore. Because all of a sudden, if a sandwich you make is eaten off the premises or on the premises, the planning regs change, and you end up in yer A1 when where you really wanna be is in yer A3.
Imagine then, that by some freak of nature, your plans match available requirements and everything is A1. You might perhaps approach someone for finance.
To borrow on a commercial property you need at least a 30% deposit. Say you don’t have that kind of capital, but you have an asset to the tune of. Then you may think that it’s a simple matter of borrowing from Peter, paying Paul, and borrowing against any existing property that you own. And yes, you can do that. But guess what? Your options extend to an interest only mortgage for a shortish term, whereby you pay just the interest and you still don’t own the building. 100 grand and ten years later you’re back where you started. Alternatively, you can take on a repayment mortgage for 25 years at a repayment price that is more than it would cost to lease the same building, with the added bonus that if during those 25 years you default, they can take your existing asset that you used as the deposit, and then make you sell it within 30 days for a greatly reduced price in order to service your business loan.
I also forgot to mention, interest rates to buy a house are currently hovering around 3%, subject to status etc. Commercial mortgages are about twice that at around 6.99%. And I said that it’s cheaper to lease, but of course, if you’re leasing somewhere, all changes you make to the property are dead money, and the leases are at least five years, leaving you possibly stuck with a business that you find out doesn’t work after three. And if you default, possibly by no fault of your own, or because lockdowns keep putting the kybosh on you, bingo. You’re done. Kaput.
So, dear Pembroke, I’d like to see how you’re gonna pull off this spectacular regeneration feat. Will it be simply that we’ll lock down all winter, and open up for the summer when the money is around? And the hobby businesses will be still be around, and so will KFC and Dominos. But the small places that needed to make money to survive are all gone, the properties all being bought up by land-bankers. The holidaymakers won’t notice much, as long as Rowlies is still there.
Last night, Friday night in Pembroke, was dead. Absolutely dead. When we were kids the place looked like an Everest expedition on a weekend; people trying to get from one place to the next, one foot in front of the other, balancing a kebab. Now, tumbleweed, and some teens hanging around outside the kebab shop. The only thing that’s survived is kebabs. The only time town has any life is when the Middlegate does open mic on a Wednesday and you can actually hear some music. All I could hear last night on my walk was a bit of shouting from the Castle Wine Bar and the Conservative Club, and that was it.
In the orange street lights, the for-sale boards hung like unhappy sentinels. Historically, after Cromwell kicked the crap out of the castle, Pembroke was a dead town for a long time. Eventually those old money lovelies, the Owens of Orielton, bought all the land and put up their nice Georgian houses. The building of the dockyard breathed a bit of life back into the dead market town. Workers housing was built, the market was bustling. Businesses opened. But then the firing range came, and the farms were all wiped out and relocated. So the market town died again. Are we waiting for the new type of Owens from Orielton to come and buy up all these banks? They’ll obviously know the right pocket at the council that they’ll be needing to put their sovereigns in. But for yer little man who doesn’t want to risk what tiny amounts he’s accrued during life, and punt it all on something that’s deliberately made so complicated and risky, forget it.
Eventually, the Owens lost their money. They became politicians and then one of the sons pissed all the money up the wall. I’m not surprised. If I could be bothered to look, I’d probably find that his lifetime coincided with the instigation of the planning laws and Pembs County Council. After all that A1 A2 stuff, you need a stiff drink. But hurry, cos pretty soon, there won’t be a pub to go to.