Tottenham Hotspur are in the middle of building the largest and best football stadium in London, and today they announced that they finally have all the money they need to finish it. Spurs announced on their club website that they have entered into an agreement with Bank of America Merrill Lynch International Limited, Goldman Sachs Bank USA and HSBC Bank PLC for a five year, £400m loan to finish the stadium, which is currently estimated to cost around £800m.
After the bank loan, the remainder of the cost of the stadium will be covered by a £50m loan from ENIC, the organization that has a controlling majority stake in the club, and by the club itself.
Tottenham’s Director of Finance Matthew Colecott, said about the deal:
“We are delighted to have three of the most prestigious and globally recognised banks supporting us. We look forward to continuing our relationship with them and our main contractor Mace as we move into the final stages of our journey to deliver the catalyst to one of London’s largest regeneration projects."
I’m no financial expert and a lot of this is Greek to me, but from what I can gather, the club still needed to secure a substantial bank loan in order to guarantee that the stadium would be fully funded as it is currently being planned. Now they have that loan. The club has already spent nearly £400m on the stadium and what’s already been constructed; this new deal is enough to take the club over the line. Colecott also said that that once the new stadium opens, the club expects match day revenue will double to about £100m/year.
The funding of the stadium was a bit contentious a few months back. An email from Spurs chairman Daniel Levy leaked in February that showed him furious at local government officials for not following through on promised public sector funding. That funding, it was thought, could have had an impact on the terms of the forthcoming bank loan. It is not known whether the public funding came through or if that controversy had any impact on the deal that Spurs just signed.
Interestingly, this new financial deal does NOT include any forthcoming funds from the naming rights of the stadium itself, which has not yet been announced. Also, in a report about the new financial scheme in Bloomberg News, Colecott was clear that the funding of the new stadium would have no impact on Tottenham’s transfer policy, or its ability to buy and sell players this offseason. “This is not going to touch the football, these are very separate budgets,” he said.
The club is in the process of tearing down White Hart Lane to make room for the construction of the new stadium, which overlaps the footprint of the old one. The new stadium is currently scheduled to be ready in time for the start of the 2018-19 season.