Everton, Milan, Real – football stadiums are back on the agenda

ON A weekend when Brentford will welcome another of the big six clubs to their home ground in the form of London rivals Chelsea, the club’s progress, allied to the opening of their new stadium, is a reminder that life has indeed continued during the covid-19 pandemic.

Brentford said farewell to their homely and atmospheric Griffin Park more than 12 months ago, but their arrival in the Premier League has been something of a breath of fresh air for the rest of top level football. The Brentford Community Stadium, a project that was talked of for some years, took roughly two years to build and cost £ 71 million, a fraction of some of the bigger Lego kits in football, but just about right for Brentford’s needs.

It’s good to see that the club was able to take its relocation to conclusion against a backdrop of confusion, economic disaster and social unrest. It is arguable that the realism of the club’s project enabled them to not only achieve their objectives but also generate success on the field of play. Brentford have already played host to Arsenal, Liverpool and now Chelsea – if anyone needed proof of the glamour of the Premier, the club has seen it in the first couple of months of 2021-22, and furthermore, they’ve only been beaten once in the league. 

Some stadium plans have floundered during the pandemic, or at the very least, proved more expensive or been rescheduled. Real Madrid have been working on a major refurbishment of the Bernabéu during the crisis and played their behind-closed-doors games at their training centre. This is a gargantuan scheme that will cost £ 700 million and include restaurants, a museum and a casino as well as retail outlets. It’s a project that will take three and a half years.

The 81,000 capacity stadium is aimed at improving efficiency, sustainability and provide more revenues streams. They wanted to include a hotel and shopping centre, but that didn’t get past the planners. In some ways, the pandemic has possibly helped Real push on as it was far easier to shift their games as spectators were not permitted.

Real Madrid are creating the ultimate digital stadium, which underlines that football at the highest level is warmly embracing new technologies. Already, some clubs have moved towards cashless stadiums, which makes sense for the transit of big crowds. KPMG Football Benchmark recently wrote about the speeding-up of the process of technology adoption: “Digitalisation not only improves guest experience but also helps these facilities comply with health measures by reducing human contact. Online ticketing, contactless entry, crowd control apps showing the fans the quickest route to their seats, pre-ordering food and beverages to your seat, among others, are here to stay in the long run.”

In England, the biggest transaction centres on Everton, who have started work on the proposed Bramley-Moore Dock stadium. The infill of the dock has begun, with sand collected from Liverpool Bay and the Irish Sea and piped into the dock via a dredger. This stage of the build, a huge maritime engineering project, is expected to last up to four months. While some fans have misgivings about the move away from the club’s ancient home of Goodison Park, the new stadium, there will also be funds to support the transformational regeneration of north Liverpool and south Sefton. Everton have also been granted a £ 30 million loan to contribute to the overall project. Everton have forecast the new stadium project will boost the local economy by more than £ 1 billion and attract 1.4 million visitors to the city.

This is important as the local council have made it clear they are not investing in a football club, but in the regeneration of a region of the city that was in poor shape. Finding big backers has become harder, but Everton’s major shareholder, Farhad Moshiri, has provided £ 100 million of the cost and the club is also hoping to tap the capital markets in the form of stocks, bonds and securities, with the assistance of JPMorgan and MUFG.

The other high profile deal that is far from settled is the new San Siro in Milan. Actually, the Milan scheme is one of several in Italy. KPMG pointed out that the average age of Serie A stadiums is 69 years, some eight years younger than the English Premier. KPMG added: “Italy’s strict regulations in relation to preservation of architectural heritage, combined with the economic hardships caused by the pandemic, may significantly postpone the realisation of projects being planned. For example, Italy’s Ministry of Cultural Heritage and Activities (MiBACT) recently ruled that Fiorentina’s Stadio Artemio Franchi could not be demolished or undergo a major redevelopment due to its historic status.”

The delays with the San Siro are due to the local political calendar, differing agendas and council reticence, among other factors. There’s another issue that has emerged in recent weeks, and that’s the future of Inter Milan should San Siro go ahead. The new owners of Newcastle United, Mohammed bin Salman, has expressed an interest in acquiring Inter and a price of £ 850 million has been mentioned. If San Siro is rebuilt, opening the doors for greater revenue streams, the club becomes that more attractive. Apparently, Inter’s troubled Chinese owners, Suning, are looking for around € 1 billion. 

Meanwhile, the arrival of Saudi Arabian owners in Newcastle could mean St. James’ Park will undergo some refurbishment, along with the club’s training ground. This could merely be one of a number of major overhauls in the UK as a bid to host the 2030 FIFA World Cup is planned. 

The creation of bigger and more diverse stadiums may become more pressing as clubs move out of crisis mode and the damage of the pandemic is fully assessed. But where will the money come from? It has already become clear that alternative investors have become more interested in the game, such as hedge funds, private equity and family offices, but all come with a cost that can exceed conventional bank lending rates. Banks are less likely to lend to clubs in the current climate, but as we have seen in the case of Everton and Milan, they can still be accessible for the really big deals. And it should not be forgotten that a major US investment bank was instrumental in the aborted European Super League. Ultimately, stadiums represent assets that can be leveraged, financed, mortgaged and securitised. Money to be made.

The sun stops shining for the European elite

AROUND € 6 billion has been wiped off the value of Europe’s top football clubs according to KPMG Football Benchmark’s European Elite (EE) report for 2021. Covid-19 left its mark on the continent’s leading clubs, the top 32 losing 15% of their enterprise value (EV) over the past year. What’s more, the pandemic impacted the financial performance of the top 80 clubs, between them they incurred net losses of over € 2 billion. In 2019, 20 of the 32 clubs in KPMG’s report made a profit, but in 2020, only seven were not in the red.

KPMG’s report comes at a time when the word “elite” is being redefined European football. The aborted attempt to create a European Super League  (ESL) threatened to redraw the game’s global map, but there can be no doubting the influence or intent of the 12 clubs who acted as standard bearers for the breakaway competition.

The EE top 10 comprised eight of the 12 ESL advocates. Real Madrid, for the third year running, topped the list with an EV of € 2.9 billion, followed by rivals Barcelona whose EV is only € 40 million lower. Manchester United were third with an EV of € 2.66 billion. All of this year’s top three were in the € 3 billion bracket a year ago. While Real Madrid and Barcelona’s EV decline was 16% and 10% respectively, Manchester United lost 20% of their value.

All three clubs experienced revenue declines, United suffering a 19% deterioration in their income. United are just one of eight Premier League clubs in the top 32, but the league’s combined EV drop was 18%. While five of the leading pack were from the English league, Arsenal fell out of the top 10, a reflection of the London club’s recent decline on and off the pitch. West Ham United dropped out of the 32, while Atalanta, Fenerbahce and Olympique Marseille the new entrants.

Of Europe’s big five leagues, Serie A and Ligue 1 sustained the most damage from the pandemic, although the Bundesliga endured a 30% decrease in matchday revenues. 

After a period of growth, the top 32 had a combined value of € 33.6 billion and of this total, the 12 ESL clubs contributed € 22 billion. This underlined the power and influence of these clubs. KPMG’s research revealed they also account for 74% of social media popularity among football’s top clubs.

KPMG’s elite included five league champions, six runners-up and 10 clubs who finished third or fourth in their domestic leagues. The lowest-placed member of the 32 was Schalke, who were relegated from the Bundesliga.

The past year has been very traumatic for football, especially in the lower leagues and at grass roots level, but the pandemic has provided an opportunity to reassess the modern game and the business models of the leading clubs. KPMG made a number of suggestions in their report, but they were adamant that the entrenched and long-lasting impact of the covid-19 crisis has accelerated the need for structural change. 


Photo: PA

Football’s experts and influencers – some of the people we listen to

ONE OF the big changes in the football business world has been the recognition that the most popular sport on the planet now carries far greater weight than ever before. Admittedly, the game is dismissed as being the most important of the unimportant things in life, but in terms of contribution to the economy, social relevance, employment and community, football can no longer be regarded as trivial.

The rise of football as a business sector has, quite naturally, given birth to agencies, consultancies, intermediaries and commentators who earn a living on the back of global football. Equally, these companies and individuals also provide intelligent insights and interpret the economics, politics and data that gets produced.

While many fans care little for anything other than the game of football itself, understanding the background, financial structures and key elements of reporting allows people to understand why a club is successful or unsuccessful.

Game of the People  has worked with many of the key players in this industry and has provided editorial content for a wide range of reports and papers. The following is a list of some of the people we consider to be important and influential in this field. The list is not in any order and represents a selection of our most used sources. Needless to say, the list is being added to by the week. We welcome suggestions and recommendations.

UK Media: We see the Guardian as having the best stable of journalists when it comes to football – away from match reporting, writers such as David Conn and Jonathan Wilson are not only excellent scribes, but they lay a level of intelligence and sophistication to their work that is unmatched. David Conn has a strong business element to his writing but also understands the culture of the game, witness his coverage of the Hillsborough disaster trials. Jonathan Wilson, as well as being an incisive historian, has the ability to explain how football is played and how it has evolved down the decades. And there are others from the Guardian deserving of praise and respect, including women’s football expert Suzy Wrack and Italian football authority Nicky Bandini. The Athletic has lured a number of writers away from newspapers, such as Amy Lawrence and Raphael Honigstein while the Times has the likes of Henry Winter and Alyson Rudd (who was named GOTP’s top journalist in 2019). 

Swiss Ramble: This gentleman, a Brit living in Switzerland, provides possibly the most accessible and lucid explanation of football club accounts. His analyst-level content is football finance 101 for journalists, clubs, agencies and anyone with an interest in the game’s economics. And it is quite possible that he gets nothing for his considerable work. There are countless reports that reference Swiss Ramble and plenty who take his content and give no credit to the Zurich-based Arsenal fan. He is, without a doubt, social media’s foremost analyst.

KPMG Football Benchmark: KPMG’s Football Benchmark team is based primarily in Budapest, but it’s an international group led by Andre Sartori, a Juventus-supporting Italian. They came to the game after their corporate rivals Deloitte, but their European Elite report has become one of the “go-to” papers on football club evaluation. KPMG also produces a rolling player valuation tool and are regularly interviewed on TV.

Inside World Football: Experienced journalists form the backbone of this news portal which covers a broad range of topics and geographies. The site has a number of well respected writers including Mihir Bose and Andrew Warshaw. As a reference tool, Inside World Football is invaluable.

Soccerex: An events-driven company founded by Don Revie’s son, the late Duncan Revie, which stages conferences in various parts of the world. Soccerex published its third Football Finance 100 earlier this year, a report on the financial health of the top clubs.. Soccerex’s events are great networking opportunities and invariably have some top notch speakers.

Brand Finance: Brand Finance are based in the City of London and evaluate brands across many sectors and geographies. Included in their very considerable portfolio is the Football 50, which has been expanded to take the form of an annual that includes expert opinion, data and research findings. Their publications are backed by sound methodology and industry viewpoints.

Deloitte: Deloitte’s Football Money League is really the product that started the ball rolling in football finance. Although Deloitte’s research is primarily based around revenues and the elite end of the game, rather than other contributory factors, the presentation, editorial and format provides a clear snapshot of a club’s strength. Deloitte also produces an annual review of football finance, which is equally interesting and informative. These are the people that other companies aspire to emulate.

CIES Football Observatory: The Swiss-based CIES are the data gurus of the football world, producing reports that range from basic information about performance, player values and demographics to some quite obscure topics. So strong is their offering that other companies aim to partner with CIES to make use of their skills. We live in the data age and CIES are at the heart of football’s transition to a more scientific game.

Soccernomics: If Deloitte were the groundbreakers in producing club analysis, then Soccernomics , the book written by Stefan Szymanski and Simon Kuper, provided the ultimate text book. Soccernomics is more than a tome, though, it is arguably the most intelligent volume written about the game. Soccernomics is also an agency, comprising Kuper, Szymanski and Ben Lyttleton. They advise clubs, federations and businesses across the football landscape. The book, though, is what sells Soccernomics, it is an essential companion for anyone interested in how football works.

Academics: Kieran Maguire of the University of Liverpool’s Sports Business unit is one of the pre-eminent figures in football finance. He wrote The Price of Football  (if you can get hold of it) and has featured regularly on TV, in newspapers and websites. David Goldblatt, a larger-than-life character, has written some outstanding books, such as  The Ball is Round,  The Game of our Lives  and  The Age of Football. Also worth mentioning are: Simon Chadwick, Director of the Centre for Eurasian Sport Industry and Professor of Eurasian Sport Industry; Paul Widdop, senior lecturer at Manchester Metropolitan University; Daniel Parnell of University of Liverpool; and Rob Wilson of Hallam University. There is a growing field of experts who have recognised the contribution made by football to society and the global economy. All of the aforementioned, who represent a far wider body of men and women from the field of academia, are worth listening to.