Sports Facilities: Is it time to redevelop?
The Premier League is booming and outperforming competitor leagues in terms of inward investment and revenues. The latest analysis undertaken by the Football Benchmark team of the KPMG Sports Advisory Practice shows six of the ten clubs with the greatest enterprise value play in England. It is perhaps no surprise that increasing funding has led clubs to look at improving their infrastructure especially as the Premier League has the highest stadium utilisation across the major European leagues despite lagging behind both Germany and Spain in average stadium capacity.
Of the eight Premier League clubs ranked in the KPMG report, all but Arsenal are reported to have plans for stadium expansion or redevelopment at various stages. Tottenham’s new White Hart Lane development is set to be the most expensive per seat stadium development to date. With the average Premier League stadium approximately 20% smaller than the average Bundesliga stadium, expansion makes good sense for clubs looking to compete on the European stage.
Investing in bigger and better facilities allows a club to create a better “shop front” to welcome supporters, attract players and drive better returns from corporate investment but isn’t without pitfalls. Whilst a club’s real estate is often one of its most valuable assets it can also be a costly and underutilised space, and can lead to significant liabilities accruing.
On field matters can have a considerable impact on the demand for facilities, meaning that developing a successful estates strategy to produce sustainable growth is a huge task. Delivery of an estates strategy, however, particularly identifying opportunities to offset costs and enable development can be a valuable tool in improving efficiency and productivity with the aim of gaining a competitive advantage.
If you are embarking on a major development project, we know how important it is for you to think ahead, anticipate pitfalls and find practical solutions. Mills & Reeve have a team of more than 114 real estate lawyers all around the UK with a wealth of experience in major real estate development, finance, construction and planning. Please see our Sports Facilities flyer for more details of our strategy experience and project highlights.