New Stadium Details And Discussions

[fridgemagnet]

Does the 5 year bit mean we intend to have paid back any loan in 5 years or earlier?

 

[talkshowhost86]

From the official site:

"The remaining costs of the project will be funded from the Facility and the Club. In addition, the ENIC Group will also commit to a £50m letter of credit facility to support the stadium financing and ensure the project is fully funded through the course of its build."

Does this mean that we don't need the naming rights partner to pay off the cost of building the stadium. We can just use that to buy players with instead and pay off the loans separately?

I'm assuming we think that we can pay off the stadium (i.e. the loan) based on what we make in the next 5 years (the length of the facility).

But I would imagine that assumes we will be getting some fairly serious cash in from naming rights.

 

[Lilbaz]

I'm assuming we think that we can pay off the stadium (i.e. the loan) based on what we make in the next 5 years (the length of the facility).

But I would imagine that assumes we will be getting some fairly serious cash in from naming rights.

Think we'll pay off a good chunk then restructure the loan. Think we'll be paying manageable chunks for the next twenty years like arsenal.

 

[arunspurs]

My understanding is,

Land Acquisition & planning & building cost till date - 240m (From the Club already paid) + 100m interim loan

Bank loan to complete project - 400m

ENIC Line of Credit - 50m (From ENIC). This is probably for any unforeseen future expenses

And add 10m from NFL.

So, assuming planning estimate matches actual value of spending, club have paid/paying nearly 50% from their own pocket & partners. We could end up with loan of 400m to 500m, which has to be paid in 5 years for for 0 interest.

We are not a risky enterprise. We are a well run club making profit & good balancesheet. Post 5 years, the loan interest rates should still be very low as well. Given TV money alone is in range of 150m a year 400m loan is something we could live with & sustain progress.

 

[talkshowhost86]

Think we'll pay off a good chunk then restructure the loan. Think we'll be paying manageable chunks for the next twenty years like arsenal.

Yep I'm sure the agreement includes provisions for the whole thing to be restructured on expiry.

Actually the fact that there's no early repayment charge suggests the banks don't think we'll be doing that!

 

[talkshowhost86]

Really does highlight how well we've been managed where we've been able to get to where we are whilst spending £240m of our own money (not that simplistic I'm sure but there we go) on the stadium to date.

 

[Lilbaz]

Really does highlight how well we've been managed where we've been able to get to where we are whilst spending £240m of our own money (not that simplistic I'm sure but there we go) on the stadium to date.

Also built the training ground which was £60m+ (not including the player block and expansion).

 

[talkshowhost86]

Also built the training ground which was £60m+ (not including the player block and expansion).

Yup.

And on top of that we survived a period where Harry Redknapp was in charge which must account for another £100m or so 'disappearing'.

 

[Gb160]

 

[danielneeds]

So basically it's this £400m loan that Levy is trying to get the naming rights to cover, or at least the lion's share of it...

 

[spursfan77]

Think we'll pay off a good chunk then restructure the loan. Think we'll be paying manageable chunks for the next twenty years like arsenal.

The thing with Arsenal is that they did all their financing when the tv deals were much smaller. With any luck the current deal, the next one and the increased champions league tv money (if we get into it next season) will negate the need to pay it off over a longer period. But yes, I agree we could well do that too.

 

[arunspurs]

So basically it's this £400m loan that Levy is trying to get the naming rights to cover, or at least the lion's share of it...

Yes...If we pay off by 5 years then we dont pay interest. But the naming rights will be most likesly be spread over 20 years. So, he has to do some juggling act if he wants to pay off within 5 years. Its possible majority is paid in first 5 years, then we refinance the deal to reduce interst

 

[danielneeds]

Yes...If we pay off by 5 years then we dont pay interest. But the naming rights will be most likesly be spread over 20 years. So, he has to do some juggling act if he wants to pay off within 5 years. Its possible majority is paid in first 5 years, then we refinance the deal to reduce interst

Hmm, I wonder if it he'd be able to structure the naming rights with some upfront payment?

 

[Lilbaz]

The thing with Arsenal is that they did all their financing when the tv deals were much smaller. With any luck the current deal, the next one and the increased champions league tv money (if we get into it next season) will negate the need to pay it off over a longer period. But yes, I agree we could well do that too.

They could have paid it off quicker but the interest was about 2% on the long term loan so didn't bother. They still owe about £200m but with inflation and increased revenue they are better off paying in installments.

 

[millsey]

Anyone know the Likely value of naming rights per year?

 

[danielneeds]

Anyone know the Likely value of naming rights per year?

Well reportedly he was seeking £400m, 20m a year for 20 years. What a surprise! The same amount as the loan.

http://www.dailymail.co.uk/sport/fo...ming-rights-deal-battle-Chelsea-West-Ham.html

Whether he gets it or not is another thing.

 

[millsey]

Well reportedly he was seeking £400m, 20m a year for 20 years. What a surprise! The same amount as the loan.

http://www.dailymail.co.uk/sport/fo...ming-rights-deal-battle-Chelsea-West-Ham.html

Whether he gets it or not is another thing.

Shows the importance of regular champions league. Got 40 plus million this season and we were pants in it.

 

[Lilbaz]

Well reportedly he was seeking £400m, 20m a year for 20 years. What a surprise! The same amount as the loan.

http://www.dailymail.co.uk/sport/fo...ming-rights-deal-battle-Chelsea-West-Ham.html

Whether he gets it or not is another thing.

Not sure it will be that much but with nfl who knows?

 

[minesadouble]

Sorry about the long post, but once I got reading and writing this morning, I got carried away!

If you don’t want to read the whole thing, my conclusion is: the alarmist media coverage (and lazy journo narrative) that Spurs won’t have any money to spend for years because of the new stadium is plain wrong!

I spent 20 years as a banker before I saw the light. If you’re interested, here’s my assessment based on available information and other stuff I know:-

1. By signing this Loan (replacing the interim £200m one) it means the Club may now feel able to model expenditure and income reasonably accurately for at least 5 years ahead. However, they’ve chosen a ‘bullet’ repayment which means that nothing (except interest) has to be repaid until 2022. The early repayment option means that any lump sum (naming rights) COULD (at the Club’s option) be used to pay off part of the debt immediately. So the financing takes in all the hotel, apartments and planned neighbourhood expenditure, not just the Stadium completion by next summer.

2. Libor is currently about 0.3% so the interest payable is about 2.5 – 3.25% per annum (until rates rise, when the Club could hedge). The variable margin may rise after x years, or relate to the top slice (ie. above x million). In any event, the interest rate looks pretty attractive and implies the lenders see it as a good risk. £12 million of interest per annum (ie. £400m x 3%) is about £230k per week, or one Rooney salary if you look at it that way. A chunk of money but not a game-changer.

3. The message the Club has consistently been giving is that repayment of the Property Development Loan is not reliant on our ‘normal’ operations (ie. football). Repayment will come from other sources including substantial property builds/sales, the NFL, boxing, concerts income, a naming rights deal, and other non-football sources. Not player trading. The lesson from Arsenal / Emirates has been well learned. I suspect Pochettino will have more (not less) money to spend than outsiders assume (there are reasons to assume this that I won’t go into here and now). The philosophy of having a wage-cap is a slightly different issue.

4. In 2015, Spurs had income (in very round numbers) of £200 million. This split 50% from PL TV and Europa League Prize money, 30% commercial income and only 20% Match Day revenues (ie. only £40 million), including season tickets. Player Trading – in and out – is accounted for separately from normal income / expenditure.

5. Leaving aside the potential of Wembley next season, by 2018, Spurs total annual income is likely to be transformed. The PL TV contract is already worth substantially more than 2015. Our commercial and retail operations are growing (and set to grow a whole lot more). A decent Champions League run can be worth an extra £20+ million minimum (depends on Euro rate and how far we get). And on top of this our Match Day Revenues are predicted “to double”.

6. If stadium capacity grows from 36,000 to 61,000, I personally suspect revenues will at least double. I hope that prices for ‘the ordinary fan’ will not change much from old WHL levels. But the average yield per seat overall will grow due to the number of new seats dedicated to those paying more.

7. The Club appears to have learned something else from Arsenal / The Emirates. The number of old style WHL corporate boxes has been cut. Instead around 6,000+ (?) of new capacity is being committed to more expensive season tickets, aimed at fans who are prepared to pay more with a few canapes and a glass of wine thrown in. The two expensive Clubs (H Club and Tunnel Club have a combined capacity of only about 300). Increased revenue shouldn't come at the cost of atmosphere and noise.

8. If, as I suspect it will be, the ‘safe standing option’ is eventually approved, then total capacity rises to around 67,000+ (I think our numbers are being kept deliberately vague so Chelsea’s architects don’t know exactly how big new WHL will be!). This would obviously increase Match Day revenues further.

 

[THFCSPURS19]

Sorry about the long post, but once I got reading and writing this morning, I got carried away!

If you don’t want to read the whole thing, my conclusion is: the alarmist media coverage (and lazy journo narrative) that Spurs won’t have any money to spend for years because of the new stadium is plain wrong!

I spent 20 years as a banker before I saw the light. If you’re interested, here’s my assessment based on available information and other stuff I know:-

1. By signing this Loan (replacing the interim £200m one) it means the Club may now feel able to model expenditure and income reasonably accurately for at least 5 years ahead. However, they’ve chosen a ‘bullet’ repayment which means that nothing (except interest) has to be repaid until 2022. The early repayment option means that any lump sum (naming rights) COULD (at the Club’s option) be used to pay off part of the debt immediately. So the financing takes in all the hotel, apartments and planned neighbourhood expenditure, not just the Stadium completion by next summer.

2. Libor is currently about 0.3% so the interest payable is about 2.5 – 3.25% per annum (until rates rise, when the Club could hedge). The variable margin may rise after x years, or relate to the top slice (ie. above x million). In any event, the interest rate looks pretty attractive and implies the lenders see it as a good risk. £12 million of interest per annum (ie. £400m x 3%) is about £230k per week, or one Rooney salary if you look at it that way. A chunk of money but not a game-changer.

3. The message the Club has consistently been giving is that repayment of the Property Development Loan is not reliant on our ‘normal’ operations (ie. football). Repayment will come from other sources including substantial property builds/sales, the NFL, boxing, concerts income, a naming rights deal, and other non-football sources. Not player trading. The lesson from Arsenal / Emirates has been well learned. I suspect Pochettino will have more (not less) money to spend than outsiders assume (there are reasons to assume this that I won’t go into here and now). The philosophy of having a wage-cap is a slightly different issue.

4. In 2015, Spurs had income (in very round numbers) of £200 million. This split 50% from PL TV and Europa League Prize money, 30% commercial income and only 20% Match Day revenues (ie. only £40 million), including season tickets. Player Trading – in and out – is accounted for separately from normal income / expenditure.

5. Leaving aside the potential of Wembley next season, by 2018, Spurs total annual income is likely to be transformed. The PL TV contract is already worth substantially more than 2015. Our commercial and retail operations are growing (and set to grow a whole lot more). A decent Champions League run can be worth an extra £20+ million minimum (depends on Euro rate and how far we get). And on top of this our Match Day Revenues are predicted “to double”.

6. If stadium capacity grows from 36,000 to 61,000, I personally suspect revenues will at least double. I hope that prices for ‘the ordinary fan’ will not change much from old WHL levels. But the average yield per seat overall will grow due to the number of new seats dedicated to those paying more.

7. The Club appears to have learned something else from Arsenal / The Emirates. The number of old style WHL corporate boxes has been cut. Instead around 6,000+ (?) of new capacity is being committed to more expensive season tickets, aimed at fans who are prepared to pay more with a few canapes and a glass of wine thrown in. The two expensive Clubs (H Club and Tunnel Club have a combined capacity of only about 300). Increased revenue shouldn't come at the cost of atmosphere and noise.

8. If, as I suspect it will be, the ‘safe standing option’ is eventually approved, then total capacity rises to around 67,000+ (I think our numbers are being kept deliberately vague so Chelsea’s architects don’t know exactly how big new WHL will be!). This would obviously increase Match Day revenues further.

How long before we can spend £70m on a player? I mean, that's what's important, right?