Last week West Ham United find out their fate for the future of the London Stadium. London Mayor Sadiq Khan has taken ownership of the arena after the London Legacy Development Company are set to enter bankruptcy.
So what now for the West Ham owners? In terms of football politics this has been a deal that is only going to end one way… and that is West Ham United will be sole owners of the stadium.
The club currently has 98 years left on their £2.5million (plus interest) per-year lease on the stadium, which cannot be broken unless the club opt to buy the stadium. This is main reason Gold and Sullivan has kept back heavy spending in the transfer market and maintaining a £4m net spend this season.
Despite performances on the pitch, everything has gone to plan in the boardroom terms with regards to financial position for the London Stadium. The club sold the Boleyn for £76m to Galliard Homes and invested £18m towards to the conversion costs of the LS, agreed a long term lease and now the next move is to purchase the stadium from a debt ridden owner. With the legacy company now out of the picture, the club can approach the London mayor with a financial proposition that will secure the status of the potential white elephant.
West Ham United can negotiate a deal where they can offer an upfront sum between £50-£100m for the stadium with a continued annual instalment for a reduced period of time. The fee to purchase the stadium will be around £300m so that the government can recoup the “Taxpayers” money. The Hammers could offer:
- £50m upfront with £2.5m (interest free) per season over 98 years.
- £50m upfront with £5m (interest free) per season over 50 years.
- £100m upfront with £2.5m (interest free) per season over 50 years.
- £100m upfront with £5m (interest free) per season over 25 years.
- £100m upfront with £1m (plus interest) per season for the remainder of the lease.
Whatever deal occurs, West Ham can finally be in a position to have ownership of the London Stadium and personalise the venue to their hearts content. What is also very important for the owners is that this purchase will remove the percentage of profit contribution to the government as part of the lease agreement.
This means that West Ham fans could finally get what they wished for by the board selling up to a wealthy owner with Gold and Sullivan making a profit in the process.
On the pitch the owners haven’t been that great and their proposal for top four Premier League finishes hasn’t gone to plan at all, but off it they are fantastic businessmen and although we fans cannot see it, politically they are securing our future for many more generations to come.
Is this now the beginning to something special? Let hope we stay up to find out!