Tottenham Hotspur’s stadium redevelopment is a significant step closer after the club agreed a £350 million funding package with three investment banks.
HSBC, Goldman Sachs and Merrill Lynch will provide almost half of the money required to complete the £750 million rebuilding of White Hart Lane. The rest of the funding will come from advanced ticket sales, a ten-year ground rental arrangement with the NFL and a possible naming-rights deal.
Confirmation of the commercial loans is a big boost for Tottenham as they prepare to announce their departure at the end of the season from their home of 118 years. The plan is to spend a year at Wembley before returning to a rebuilt ground on an adjacent site in north London for the start of the 2018-19 season.
As he announced Tottenham’s results for the year ending June 2016 yesterday, which included record revenue of almost £210 million and record post-tax profits of £33 million, the chairman, Daniel Levy, said that the move to Wembley would not be finalised until there was greater clarity on the delivery of the new stadium, but the club are confident about the original timetable. The FA has agreed to extend tomorrow’s deadline to sign the Wembley lease agreement until next month, as revealed by The Times last Saturday.
The delay in confirming that White Hart Lane will definitely close this season is understood to stem from concern at the spiralling cost of the project, which has increased from a projected £450 million to between £750-800 million, but the private funding has been secured regardless. It is understood that the three banks will each provide loans at a fixed rate over an initial five-year period, after which the plan is to re-finance them.
Tottenham are committed to borrowing £90 million more than Arsenal did when building the Emirates Stadium a decade ago and accept that the funds available to Mauricio Pochettino for transfers will be limited for the next five years, much as they were for Arsène Wenger at their local rivals.
Spurs are confident of gaining a substantially more lucrative naming rights deal than the £2.8 million-a-year contract Arsenal struck with Emirates in 2004, with Levy targeting a £20 million-a-year deal for 20 years. Tottenham also expect a significant increase in match-day revenue at the new stadium as the capacity increases from 36,000 to 61,000. Yesterday’s report revealed that there are 63,200 people on the waiting list for season tickets and the plan is to focus on offering hospitality for corporate clients in advance ticket sales. The most expensive season tickets will cost £8,000.
In addition to the NFL deal, Spurs have secured £9 million and £18 million in funding from Haringey Council and the London Mayor’s office respectively to aid regeneration of the local area.
Levy said: “This financial period saw record revenues and the club’s highest-placed finish in the Premier League. We have run this club on a financially secure basis for the past 16 years while remaining ambitious and with a vision for its future growth and success.”
(The Times)
