There is no doubt that, in a vacuum, one could finance the stadium more inexpensively, but the reality is that it would be tough to do. The stadium already has a 180 million GBP loan on it. Convincing a lender to finance an additional 120 million GBP in a subordinated position would be borderline impossible.
Is that loan related to Covid impacts? I thought for sure the club had less than that remaining on the original balance.
The balance was lower - around 130 million GBP , but the financials say that they incurred an additional 40 million GBP in finance charges redeeming the bonds. The old stadium debt had Letters of Credit that could be called if certain criteria were not met, and some of that had to do with maintaining a certain level of gate revenue. Obviously, during COVID, gate revenue plummeted ,and this probably is why Kroenke was forced to refinance. That last part is an assumption, obviously. It's hard to know anything with certainty when the club is privately held. There are too many missing pieces.
I just recall the club making a concerted effort to pay down the balance as soon as possible to alleviate fees and loan insurance, as well as to be in control of revenue streams so as to allegedly direct them to the roster. About the time Alexis was acquired was to signal how the team had transitioned from the worst of payment burdens to easier, clearer financial terms. I know debt can be a tool for smarter overall financial management, but 99 years for 120mm seems absurd. But if it yields trophies I'll happily abide.
It undoes the whole point of having a stadium of our own. It's undoing the project where we endured no trophies and ridicule for that. If Kroenke sells then we still have no stadium.
I don't claim to be an expert on finance or stadium ownership, but it does raise my eyebrow. There have been other problems where English teams don't own their own stadium. And that bit about the 99 year lease... I'd be lying if I said it didn't make me think of another famous 99 year lease that seemed like forever, and stable, until it wasn't... Hong Kong. Certainly not perfectly analogous to our stadium, but you get the point.
I think you are conflating things. KSE bought the stadium for £120 million. Full stop. AFC also allegedly has leased the stadium back for £10 million per year. The lease term of 99 years actually is great because it effectively gives AFC control and right of use of the stadium for the next century. In this context, the longer lease term is for AFC’s benefit. Not really. We built the stadium because the board, with Wenger’s help, sold the fans on this idea of a “sustainable model” in which the club only runs on its own resources without any owners spending a dime. The only way to do this was to build a bigger stadium because Highbury did not hold enough seats (and corporate luxuries). That plans was unrealistic back when you could buy elite players for £30 million. Now, it’s pretty much a fantasy for almost every club in the world. A £10 million per year lease payment is not going to change the club’s financial standing in any material way. I do question the motives behind the purchase, but there is no way to know what they truly are. Kroenke owns KSE, AFC and the stadium. How he moves the money around his entities/assets is his business. Blame the old owners for cashing out and giving him the club.
What seems less than ideal is the club still has to pay the debt and the lease payments, but is not the owner. I do agree a 99 year less is favourable to the club. Hard to know why this is being done, but it would make sense if the point is to monetise the stadium in new ways, so that Arsenal is only the anchor tenant.
The problem is football does not have a sustainable business model for the top clubs - that's why the Super League clubs tried to break away.
Depends on the structure of the deal. Thinking about it, if it were really a sale of the stadium, 120 million quid seems really low? There's nothing preventing monetizing the stadium while having AFC be the owner.
That's what I think - the spurs stadium is costing a billion. Even with the debt deducted, 120m is nowhere near market value? True but maybe Arsenal just doesn't have that corporate focus?
We've been talking about the club selling our stadium to KSG and then leasing it back for 99 years. And as I hear the latest stories about Derby County and how their previous owner (who fvcked them over, causing points deduction and ultimately relegation to 3rd tier) is still the owner of their stadium, which is complicating their sale to a new owner... And I recall stories about Coventry City who also fell on hard times, didn't own their own stadium (maybe in that case it was a community owned stadium?) and it caused them to play their home matches like 40 miles away for a few years. I'm no lease expert, but I figure that the lessee is not in the driver seat, in control of their home. Which arguably for us is as an important part of their identity and future as any club. So my gut feeling is still that it's largely preferable for the club to own the stadium, and whenever the club were to be sold, the stadium would still be implicitly owned by the club. What say ye?
https://www.espn.com/nba/story/_/id...year-deal-worth-40m-includes-ownership-equity Didn't really know where to post this, but Josh was never going to match an offer for his GM that included equity in the team. Business is business. Just thought others might find this interesting.
Based on the first-hand experience of all the professional men‘s sports teams in MN, this likely means that this move will be an epic fail for the T‘Wolves, and that the Nuggets/Kronkes will only improve from this.
Dawned on me this week that we haven't heard a single word about KSE, Josh or Stan in weeks or months. Amazing what a good run of form can do to quiet the dogs. And to KSE’s credit they stay in the background unless there's some compelling reason to do otherwise. Probably that's the best kind of owners you can have. They've simply backed Arteta and his project in numerous ways and at numerous times over the last several years. Even if we don't defy the odds and win the EPL or UCL this season, a big, collective "well done!" is in order for our management team... in the broadest sense of the word team.
Sure - it's possible to mess up badly But I am not sure why i should think highly of the ownership after the last 20 years of failure, massive under funding of the team and now Afc doesn't even own the stadium anymore. Meanwhile Stan K made a fortune off fans backs.
I don't think anyone is characterizing them as white knights. But I don't think it's a coincidence that they started becoming more involved hands on once they were able to get Usmanov out.
I mean, sure. Billionaires suck. I’m not sure why you shouldn’t think highly of the jobs Arteta and Edu have done, though. If you’re that far down the rabbit hole of concern over spending, why even pay attention to football anymore? The world is on fire and capitalists are emptying their cans of kerosene. The way owners of football clubs operate in that business seems pretty trivial at this point.
I think front office plus arteta have done a good job over the last 3 years, but I was also pointing out that we've been one of the top spenders in that timeframe. Of course it has helped immensely that Utd and now Chelsea have been so badly managed. In the end though, if we go through the next 2-3 seasons with this side, and they don't win anything, how good is that job really?
Well also once the free ride ended, it became clear that they would have to invest if they wanted to preserve the asset value let alone make further gains. This is why the other US owners looked to sell - Liverpools ownership, and ditto the glazers.