By Tony Attwood
It was the fact that between the Invincibles Season and the 2014 FA Cup victory Arsenal didn’t win any of the major trophies, which became the central rallying call for the aaa.
Their argument was very much that this was not good enough for Arsenal, and that a different manager with different financial arrangements behind him would have done better. The model that was wanted was that of Man City or Chelsea with Alisher Usmanov taking on the role of paymaster in chief..
But as I have pointed out before, although money can buy lots of things it doesn’t guarantee success. In the last two seasons Man City have won the League once and League Cup once. Chelsea the same. Arsenal the FA Cup twice. And looking at Chelsea this season it seems that vast amounts of money doesn’t guarantee anything much. Money helps, but on its own it is not enough – or so it seems to me.
Against such a backdrop, I find it fascinating to see where Chelsea and Tottenham are going with their stadium redevelopments and how they are going to finance the deals, which is why I’ve returned to the theme a number of times over the years – and here it is once more.
Tottenham’s final set of stadium plans contained a bit of a surprise: a £750m forecast of the cost of their stadium development – up significantly from the £400m that was talked about in earlier days. Apparently accommodating the NFL franchise has increased the cost quite a lot, and there have been a lot of other changes from the earlier plans which allowed Tottenham to play on in the stadium, without having to move out at all.
According to the details giving in the latest planning documents that have been released Tottenham have spent £100m on initial work, and planning. They have confirmed that the rest of the money will be raised through taking on debts, advance ticket sales and stadium naming rights. Pretty much the standard model, and without any significant additional finance from the owners which some had forecast.
Tottenham are helped by the fact that they are debt free, and so the deal looks to be something along the lines of £350m bank loans over five years, which will then be refinanced. Naming rights are expected to bring in £30m a year, and if the club can get five years paid up front that is obviously another £150m which gives £500m. Advance corporate ticket sales and an up-front kit deal payment stretching for five years might bring another £100m leaving £50m requirement from secondary sponsors also front loading their payments.
Such deals put Tottenham on a par with Arsenal in terms of value, and it may well be that there are sufficient sponsors around who will be willing to pay that price. And indeed if Tottenham then could sustain a run of top four finishes they would be able to market themselves as equal to Arsenal – unless of course Arsenal maintain their achievement of the last two years by continuing to win trophies.
The downside for Tottenham is the same as it was for Arsenal – the deals to pay for the stadium eat up the money that might otherwise be available for player purchase. Tottenham of course can point to their record of having made a profit on player transfers over the past five years – and that is indeed remarkable. Whether they can continue to do that I am not sure. If so it will be one hell of an achievement.
But there could be a benefit for Arsenal too. If Arsenal outperform Tottenham in the sort of things that sponsors notice – such as trophies and being in the Champions League, over the next couple of years one would expect Arsenal’s shirt sponsorship deal which runs out in 2019 to then start bringing in more than Tottenham’s. So their ability to push up income could then mean Arsenal will get more – but without having the debts to pay off.
Tottenham’s current match day earnings are around £44m a year. This is expected to rise to about £72m a year. That figure is interesting because it is quite a bit lower than the £100m that Arsenal make a year from match days – and one reason for this is the compromise that has had to be made in the re-design of the ground. This re-design led to the new ground being bigger than the Ems Stadium, but in doing so it sacrifices 25% of the corporate areas, and it is these that pay over the odds for the seats, food and drink. (Try buying a glass of wine at Club Level during the Emirates Cup and you’ll see what I mean).
So overall I’m still reaching the conclusion that Tottenham are financing their stadium in the same way Arsenal did. They have some benefits – lower interest rates in particular. And some drawbacks – it is costing more, and they don’t have nearly so much valuable property that can be re-developed and sold on to help pay for the costs.
Chelsea of course have life easy by way of comparison. Chelsea owes Roman Abramovich £1bn, and he can afford to throw in another £1bn to rebuild Stamford Bridge. Since stadium costs don’t affect FFP it won’t affect the club.
Which brings us to what the clubs will do while their stadia are being re-built. Arsenal of course didn’t have this worry – we played at Highbury and then moved. Tottenham need to move out for one year, Chelsea for three. Wembley is the obvious choice of both.
Wembley is subject to planning controls that say it can only hold 37 full scale events per year, but there is apparently no limit on the number of events it can be used for, with under 50,000 spectators and this rule would undoubtedly be used to have both clubs take over the ground. Because most of the other events booked in are held at times that would not interfere too much with league games (Charity Shield, Cup Final, Play Off finals) there wouldn’t be too many problems, although there would be a few clashes with maybe the Capital One Cup, the Rugby League final and the like. But with both Saturday and Sunday available there ought to be time, although there are also the NFL games to fit in.
It might however cause the TV companies a few problems with their scheduling if they wanted to have both Tottenham and Chelsea home games on TV, and if one of those two was playing in the Europa League that could make it a bit more complicated. But it still ought to be just about possible especially with the option of moving some games to a Friday.
Financially the word is that both clubs have agreed to pay the same amount to the FA to use the stadium, and if the FA could get Chelsea in for three years and Tottenham for one, it would be their ultimate salvation, resulting in many of their insane debts being paid off. Of course they would immediately run up more huge debts by bidding for the world cup again, buying people handbags, paying for disreputable Fifa officials to meet royalty, and all the other stuff it does, but it would get them out of the current hole. Community football would still be left out in the cold, but who cares if you can have another banquet with Fifa and Uefa officials. (Incidentally Platini is still being paid by Uefa despite being banned from football. Same with Blatter and Fifa. Funny old game).
So everything looks hunky dory – except that Chelsea’s bid is said to be for the exclusive rights – they don’t want to have to accommodate Tottenham. The view seems to be that because they will be at Wembley for three years they have to make a bigger effort to ensure that their fans buy into the deal and if they have to share with Tottenham, their fans won’t like it so much. There is also the awareness that Stamford Bridge has not always sold out for every match, and some fans might pick and choose their games at Wembley rather than commit to each and every match.
The other issue is that of what the FA do about Tottenham and Chelsea in the FA Cup. If they play their home games at Wembley, that would give them unfair advantages in FA Cup semifinals and the final, if either club got through. One can imagine them moving a semi-final to Old Trafford or the Ems, as happened in the old days, but moving the final out of Wembley would seem a step too far. Would the FA really allow Tottenham or Chelsea to play at home in the Cup Final?
Knowing the FA, probably they would.
Thus after all the waiting, all the false leads, and all the planning objections, it seems we now have a better idea of where all this is leading and where the money is coming from. Tottenham are doing it Arsenal’s way, will end up with a bigger stadium, but with a smaller income. Chelsea are doing it with funding from the owner, opening New Stamford Bridge in 2020 with a capacity of 60,000. Tottenham will be juggling the money for a few years, as Arsenal did, but as Arsenal showed, even with that juggling, top four finishes are possible. They will have to learn though, that Top 4 is Not A Trophy. (I know that cos the aaa told me).
Chelsea will have no financial problems. They just have to try and avoid relegation in the meantime. I suspect they probably will.
20 January 2006: Theo Walcott joined Arsenal from Southampton for £5m, aged 16. In 2015 he extended his contract with Arsenal having started playing some games as centre forward and scoring the opening goal of the 2015 FA Cup Final and having notched up over 200 league appearances for Arsenal.
20 January 2010: Arsenal beat Bolton 4-2 at home to go top of the league. Arsenal were 2-0 down within half an hour but responded with goals by Rosicky, Fabregas, Vermaelen and Arshavin. It was the 9th game of a 10 match unbeaten run.