Football Management

Commentary on the management of over 160 English football clubs by Dr John Beech, winner of the FSF Writer of the Year Award 2009/10 Twitter: @JohnBeech Curator of Scoop.it! Football Finance

The trouble with new stadiums 3

Posted by John Beech on July 26, 2010

[See also The trouble with new stadiums 1, which looked at the argument that "We’re a club with ambition and we need more seats to reflect that ambition", and The trouble with new stadiums 2, which looked at the argument that "We’ve got the wrong sort of stadium.  We need one better suited to maximising our revenue streams."]

The third argument that is often put for building a new stadium is:

  • There’s this amazing property deal we can do. We’ll sell the old stadium for redevelopment and there’ll be loads of money to build the new one.

My first reaction to this is, I would have to admit, intuitive.  I’m a believer in the maxim that, if something looks too good to be true, then it probably is too good to be true.

On the basis of evidence however, I would argue that in far too many cases two problems arise when this argument is out forward.

Firstly, there may well be concerns as to who exactly ‘we’ refers to.  Does it refer to the club as ‘construct’, or to the club as ‘company’?  In other words, who will see the benefit financially – the club itself or the owners?  Or in the case of Southend United, the Chairman and his family (1).  The core issue is as much one of transparency as one of the rights and wrongs of who benefits.  Unless who precisely benefits is made clear from the beginning, fans may well end up feeling they have been misled.

The second problem is the understandable euphoria that the announcement of plans for a new stadium brings.  It also tends to bring a lack of realism on both the potential costs and the potential for delays resulting from, for example, planning problems.  In the latter case, it never ceases to amaze me that clubs do not anticipate that planning to build in a green belt area might just invoke some opposition.  Even having the local council ‘onside’ is no guarantee that there will be no problems – an election can mean going back to square on.

What tends to happen as costs escalate and planning battles rage on is that any Plan B becomes forgotten, and the club’s board become obsessed with pushing through their Plan A as a matter of dogma.  All too often it is not just a case of dogma; it’s a case of having become embroiled with developers.  The board have manoeuvred the club into a position where they cannot back out – the new supermarket rather than the new stadium is what it is then all about.  Which takes me back to the exception I mentioned in my previous posting – if the owner’s expertise lies in property development it may become difficult to keep focus on the best interests of the club.

I suspect, if you have now read all three of my postings, that you may well have gathered that I am not a fan of the ‘new stadium’.  To be fair, I have been arguing my case as a generalised one.  There are cases where there are exceptional circumstances which mitigate strongly towards building a new stadium, and I’ll turn to these shortly in a fourth and final posting in this series.

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3 Responses to “The trouble with new stadiums 3”

  1. TheGreatGunnerB said

    Regarding your attempted rebuttal of the oft-put argument of “There’s this amazing property deal we can do. We’ll sell the old stadium for redevelopment and there’ll be loads of money to build the new one.”

    You acknowledge that your first, sceptical, reaction is merely intuitive – fair enough, as it is based on that old maxim.
    However, you then go on to claim that your argument against such an approach is evidence-based, but then fail to produce any such evidence.

    As in an earlier comment on your anti-new-stadium series, I shall now cite the case of Scunthorpe United.
    This time as a perfect example of an “amazing property deal we can do. We’ll sell the old stadium for redevelopment and there’ll be loads of money to build the new one.”
    Doing exactly that, SUFC was able to pay off all its outstanding debts and build the new stadium.
    Had it not done so, it would have been in severe financial difficulties for many years, with the concomitant possiblity of receivership.

    A little research goes along way, I find.

    Sorry if that doesn’t fit with your weltanschauung but, hey, why let actual evidence get in the way of your anecdotal ‘evidence’ against the building of new stadia?

    • John Beech said

      An interesting example from another era – 1988. No apologies necessary for the fact that it doesn’t fit with my Weltanschauung – I’m ‘anschauing’ a rather more contemporary world ;-)
      But hey, why look at current evidence if it doesn’t fit your rather dated Weltanschauung?
      Perhaps at one o’clock in the morning you didn’t make it through to the end of my posting where I wrote, with original emphasis “There are cases where there are exceptional circumstances which mitigate strongly towards building a new stadium”. A little reading to the end goes a long way, I find.
      Oh, and Scunthorpe made a loss before taxation every year from at least 1999 (the earliest year for which I have their accounts) to 2007.

  2. [...] Part 3 [...]

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