The London Legacy Development Corporation (LLDC) was recently ordered to publish the details of its deal with West Ham United. Starting from next season, West Ham will play its home games at the London Olympic Stadium, which has a 60 000 capacity. The LLDC was not keen on releasing the details of the contract, but was finally forced to do so after campaings for transparency proved succesfull.
The details of the deal are interesting, to say the least. The Guardian released an article on the deal last thursday (http://www.theguardian.com/football/2016/apr/14/west-ham-olympic-stadium-club-pay-per-season-rent) which details the agreement. Looking at the key points, it´s obvious that West Ham have secured themselves a very, very good deal indeed. West Ham will pay a rent of £ 2,5 million/ year (£ 1,25 million, if the club gets relegated). West Ham will not be paying for running costs of the stadium, even goal posts and corner flags are provided by the LLDC. The deal is for 25 matches/ season, if the club plays more matches than that (cup competitions, continental competitions), it will pay additional charges. Of the costs caused by conversion of the stadium to a footballing ground, West Ham will reportedly pay £ 15 million (total costs £ 272 million). Not that much, considering most of that is offset by the sale of Boleyn Ground.
The details of the deal have been listed in several sources in the last few days, so no point going through all of them here. But no matter how one looks at them, it is a game-changing deal for West Ham. Having a 60 000 -seat stadium at their disposal, West Ham will be enjoying a healthy increase in their revenue stream in the upcoming years. A rent of £ 2,5 million/year is really not a big one, especially considering the huge increase in tv-money that Premier League clubs will enjoy from next season on. Even if West Ham will finish last (highly unlikely), they will receive £ 100 million. And that´s just the tv -money, obviously ticketing income will increase as well. So will other commercial revenues, since West Ham will most likely make the leap to Champions League -level within a few years. If they won´t manage that, they have clearly done something wrong. The point is, the deal allows West Ham to make the leap to the "big league".
While West Ham certainly can´t be blamed for making the best of the situation, not everyone is thrilled with the deal. Critics have said it is unfair that the tax payers will keep on financing the goal posts, corner flags etc. One of the most voacl critics has been the former chairman of Leyton Orient, Barry Hearn, who reportedly called the deal as "outrageous for the taxpayer", and went on to say: "As far as I'm concerned, my dog could have negotiated a better deal than this". Arsene Wenger has also stated that the deal is like "winning the lottery" for West Ham. For Arsenal, it was a rather different story, as the construction of Emirates Stadium caused large sums of debt to the club.
There is certainly a case to be made about whether this kind of deal is fair for all parties involved. What the right level of rent would have been is obviously an impossible question to answer. The fact that taxpayers continue to pay for the upkeeping of the facilities understandably feels slightly unfair as well. Although the analogy "you would not expect to hire a badminton court and not have nets supplied" does bear some relevance as well. But that only takes us back to the question, what is the right amount of rent, then? The point is, it´s an endless debate. But it is certainly worth considering whether the deal is fair for other Premier League clubs. Clearly West Ham´s operations are getting supported (and will continue to be for a long time) by taxpayers´ money. That is something that definitely alters the competitive balance of the league. And in an unfair way, some might say, since deals like this are obviously something that not all teams can have. Public money doesn´t go together too well with privately owned clubs and a league formed by them.
On a larger scale, even bigger question is how feasible it is to build facilities like this for a specific purpose (The Olympic Games, in this case) in the first place. History is full of facilities one more grandiose than the other built for Olympic Games of football World Cups, that serve no purpose after the games have ended. Just look at the facilities built for Sochi Olympics, or the stadiums built for World Cup of 2010 in South-Africa. These projects are usually highly lucrative for construction companies. Huge in value, and financed mainly through public funds, making them very low-risk. But after the party is over, there are still large upkeeping costs to be taken care of. Without any consistant revenue streams to help with this, the burden often falls on the taxpayer. Either that, or the demolition of the facilities, which is also hardly an ideal solution. Therefore it´s not surprising that the LLDC were desperate to find some long term -use for the stadium, some revenue stream to take off some of the load from taxpayers. West Ham were obviously at the right place at the right time, and made the best of it.
Karren Brady, West Ham´s vice-chair has insisted the deal is good for the taxpayer, and should be congratulated. Well, it might be better than nothing for the taxpayer, but the biggest beneficiary is without a doubt West Ham themselves. How much better off the taxpayers really are (and how much better off they could have been) is debatable. Public funding should usually go to purposes that benefit the paying public. Is that the case here? I guess it´s a matter of how you look at it. One party who is definitely worse off is West Ham´s competitors on pitch. West Ham will be a serious contender for Champion´s League -spots in the future, and money will be no issue for them. And that´s bad news for the likes of Arsenal, Manchester City, Chelsea, Manchester United and Tottenham.
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