Trinity College rocks: may buy London’s O2

In a move that has rocked the academic world, Trinity College Cambridge, known over the centuries for its intellectual excellence, is in talks to buy O2, the arena in Greenwich that mainly hosts pop music shows and other low-brow extravaganzas, such as a live recreation of the epic Ben Hur.
 
In the deal, Trinity College would buy the lease to the arena from Quintain Estates and Development and Lend Lease for a reported 20 million pounds. Last week, Quintain told its shareholders that it was in exclusive talks with a preferred bidder regarding the disposal. A sale of the venue has been close on previous occasions, but has never quite gone through.

The news is likely to shock dons and undergraduates in equal measure. Trinity's alumni include some of Britain's biggest brains and greatest poets: Lord Byron, Bertrand Russell, Isaac Newton, Francis Bacon, Alfred Lord Tennyson, and six prime ministers. The O2's biggest names include Spandau Ballet, Led Zeppelin, Beyoncé, AC/DC, Depeche Mode, showman mortician Gunther von Hagens, and a WWE Raw wrestler called Viscera.
 
Formerly known as the Millennium Dome, the O2 has grown into a hugely successful live performance venue sporting bars, restaurants, nightclubs, exhibition space, and a seven-screen cinema. Michael Jackson had been due to begin a series of comeback concerts there last month.
 
Trinity College can afford the purchase – it is the wealthiest Oxbridge college and has a wide range of property investments. It is believed that about 70 per cent of money raised by Cambridge colleges is raised by Trinity, with Jesus College coming in a distant second.
 
Founded by Henry VIII in 1546, Trinity has invested billions in property over the years, and owns sites as diverse as the Port of Felixstowe and industrial parks. In 2005 Trinity was worth £621million - the same as Manchester United.
 
After being freed from statutory constraints on investment that dated back to Elizabeth I, the college negotiated a series of land deals. The most lucrative saw Trinity acquire farmland near Felixstowe which included a dock. As the only privately owned dock, Felixstowe has now developed into Britain's biggest container port, bringing in millions every year.
 
Trinity also acquired farmland near Ashford, Kent, which is now home to a science park only minutes from the Channel Tunnel. Over the years Oxbridge colleges have built up a portfolio of up to 4 billion pounds in property, generating income of hundreds of millions of pounds every year.
 
Nonetheless, the move has prompted surprise from some because endowments at the university are thought to have fallen significantly. A large part of Trinity's income is generated by rental income from commercial property, and yields on these investments have plunged in the ongoing recession.
 
 The college is also believed to have a cautious investment strategy, with many of its investments in low-interest bearing accounts.
 
Quintain's balance sheet has been creaking after a collapse in commercial property values. In June, the group warned that there was "material uncertainty" about its ability to continue trading as a going concern because it was close to breaching banking covenants.