The Organisation
Music Venue Properties (MVP) is a Community Benefit Society that brings grassroots music venues (GMVs) under community ownership, protecting their vital contributions to local neighbourhoods and the UK’s music scene.
MVP was established by Music Venue Trust (MVT) with a novel proposal: to remove grassroots venues from commercial ownership by purchasing their freeholds and renting them back to operators at market-resistant rates. MVP’s ownership model is one of long-term stewardship, supporting venues in their pursuit of funding, financial resilience and inclusive, sustainable operations. It has pioneered the idea of a ‘cultural lease’, guaranteeing the use of a building for as long as it is operated as a grassroots music space with community at its heart.
In 2023, ACIF approved its largest ever loan of £1m to MVP as part of their seed funding to establish a portfolio of GMVs to demonstrate proof of concept.
The Opportunity
MVP approached ACIF as part of its initial fundraising plans, alongside community benefit shares and grants/donations. ACIF’s first tranche of funding (£500,000) enabled MVP to reach its minimum launch capitalisation and get off the ground. To date, MVP has successfully acquired three properties – The Snug in Atherton, Greater Manchester, The Ferret in Preston and The Bunkhouse in Swansea – in widely celebrated deals. The pipeline is strong and it is anticipated that the second tranche of the loan will be drawn down over the next six months, alongside grant funding, to fund additional GMV purchases.
For ACIF, the loan to MVP represents a compelling opportunity to back an innovative, mission-aligned venture that should prove game-changing for venues across the country. With proof of concept, similar models could be developed to support other creative subsectors, creating a thriving wider ecosystem of grassroots cultural venues operated for and by their communities.
The Process
The investment due diligence process focused on the appropriateness of the financial model as well as the proposed funding mix, ensuring that ACIF could make a secured loan with sufficient loan to value coverage. As MVP was a start-up venture, the ACIF team needed to understand the basis for the assumptions and the consequences of the model underperforming expectations, in terms of pace of deployment as well as potential rent arrears and operating costs. Particular attention was paid to MVP’s investment processes, ensuring that the ACIF team were comfortable with the venue acquisition criteria in terms of financials as well as governance and impact.
The ACIF team were hugely impressed by the detailed financial model, thorough investment criteria and agility adapting to the particular circumstances of each venue. Active involvement from an experienced Board with a broad range of skills alongside support from MVT all helped to provide the ACIF team with the confidence to recommend their biggest loan to date.
The Impact
The social impacts of the venture are manifold. Issues of ownership underlie many of the challenges faced by GMVs including gentrification, high costs and chronic underinvestment. MVP’s model, providing security of tenure through its ground-breaking cultural lease, supports these venues to deliver more diverse programming, safer and more accessible spaces, and increased provision for the community within a local hub, while incubating local talent. Many of the venues targeted by MVP are in deprived LSOAs.
