The case for 60,000

Amid suggestions that the club's hierarchy are considering a capacity of between 52,000 and 55,000, the argument and justification for 60,000 at Everton's proposed dockside stadium are worth repeating

Paul The Esk 26/07/2018 65comments  |  Jump to last
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Sometimes an argument is so compelling it is worth repeating more than once. It’s the argument for, and justification of a capacity of 60,000 at the new Bramley-Moore stadium.

From my perspective there are two elements to the logical argument, namely demand and affordability, with a third more emotional argument centred on ambition and the statement that the capacity will say to the global footballing and commercial world all senior clubs operate in.

Let’s start with the logical argument, demand and affordability.

Under the “leadership” of the former CEO, Robert Elstone the club’s position has always been that there is a limit to the capacity increase because the demand for seats based on Goodison Park was limited. I assume that was the justification as actually the club never confirmed the basis for this assumption apart to vague references to “season ticket waiting lists”.

Before we get into the specifics of Everton, it is worth looking at the “new stadium effect” on attendances across a number of clubs.

Since 1988, 32 Football League & Premier League clubs have moved to a new ground. If we compare the average attendances 5 years prior to the move versus 5 years after average attendances increased by 62%.

If we look at clubs that had more than 80% stadium utilisation prior to the move (i.e. had average attendances greater than 80% of capacity) the increase in attendances, over the same time frame, are striking.

Sunderland AFC 135%
Southampton FC 94%
Derby County FC 90%
Arsenal FC 57%
Manchester City FC 34%
West Ham United FC (*based on 2 seasons) 63%

The one club which is always used as a counter argument to an aggressive increase in capacity is Manchester City. It’s often said that they have difficulty in selling out their increased capacity Etihad stadium. In the first 8 years at the Etihad they had 96% utilisation, followed by 98.8% utilisation in the last three seasons.

Tottenham Hotspur are increasing capacity by 72% and will perform in front of capacity crowds for the foreseeable future.

Looking specifically at Everton, what is the basis for believing we can fill a 60,000 seat stadium?

The demand to watch Everton, despite the difficulties on-field and the antiquated, but much loved Goodison Park continues to grow. The best season of football in recent years at Goodison was Martinez’ first season. In that we averaged 37,732 spectators. Last season we averaged 38,797 in what was the worst season on record. The season before we averaged 39,047, the first time in our history we sold out for every game, and the highest average attendance since 1978, and only beaten 3 times since the Championship winning side of 1969/70.

This, in a stadium which is perhaps 25 years past its “best before” date with limited facilities, and many thousands of obstructed views.

The easiest way to judge demand is to break down the crowd into different categories, to segment the different types of fans and see how realistic it is to sell each category.

I’ve used the following categories: Executive or premium seat spectators, season ticket holders, and “walk-up/non-season ticket holders”. For the purposes of this piece, we can ignore away supporters on the assumption we will sell a maximum of 3,000 for every game. Also, the sale of away tickets to Bramley-Moore is outside the control of Everton.

In a 60,000 capacity stadium it’s a reasonable assumption that the categories would breakdown as follows:

Season ticket holders: 42,000

Executive/premium seats: 5,000

Walk up/non-regular supporters: 10,000

Away supporters: 3,000

With an admirable pricing policy Everton at Goodison have maximised season ticket sales, topping out at 32,000 (the highest permitted under PL rules). This compares with Manchester United 55,000, Arsenal 45,000, Tottenham Hotspur 45,000, Manchester City 40,000 and West Ham United a staggering 52,000.

West Ham United have, by moving to the much-maligned former Olympic stadium increased season ticket sales from around 25,000 at the Boleyn Ground to 52,000 in their third season at their new home.

I have been extremely cautious in suggesting an executive/premium capacity of only 5,000. Whilst this represents a big increase from our existing 1400 or so “premium” seats it is a relatively low percentage of the overall capacity of the ground (8.3%). Most modern stadia look in excess of 10%, Liverpool currently are at 14%. Chelsea had they gone forward with their ground redevelopment were looking at 28%. Tottenham’s redeveloped New White Hart Lane has 12% premium seating.

The ratio of premium seating to regular seating is extremely important – it helps keep the cost of regular seats affordable (although admittedly not at Tottenham). As a rule of thumb, 10% premium seats should generate the same level of matchday income as the remaining 90% regular seating.

5,000 is an extremely conservative figure, and one which the club should have every confidence in selling out season after season at an iconic stadium in an iconic location.

The final category is walk up/non-regular spectators. By this I mean the wide group of people who will visit any number of games from a one-off visitor to fans who can’t get to every game and therefore do not have a season ticket.

The figure of 10,000 may seem high. However, in reality, it is very achievable. Everton have always had a relatively high “walk-up” element to our support. This is born out by “walk-up” sales of between 5,000 and 7,000 during the Moyes’ era when season ticket sales were much lower, and indeed our continued ability to sell out the worst seats at Goodison regardless of the opposition. It’s also a low figure when viewed against other club’s “walk-up” figures. Liverpool rely upon approximately 18,000 non-season ticket/non-executive sales per game.

With the right approach to marketing which includes attracting casual visitors, local and far-flung blues who can’t attend every game, it’s a very achievable figure. Everton have proven very adept at marketing tickets to Goodison which given the quality of the view (and many times the product as well) should give them huge confidence to achieve capacity crowds.

Affordability

The evidence for demand, and the general effect of a new stadium is there for all to see. The second element is affordability.

There is no doubt that the final 10% of seats put into a stadium are (i) the most expensive to build and (ii) the most difficult to sell. I’ve covered the likelihood of selling these seats, what about the cost?

Every seat carries a construction cost, some of which is relatively fixed, for example in the case of Bramley-Moore the ground preparation and technical challenges of the site, plus a variable cost based on all the additional core resources required as a stadium grows in size.

If we take an industry accepted average of around £6,000 a seat for a stadium build, what impact does a much higher cost for the final seats have?

If I assume it costs £9,000 per seat for the last 6,000 seats that adds £54,000,000 to the build cost. If all of that money is borrowed at 5.25%, then the additional cost is around £3.9m a year.

That means the last 6,000 seats cost £650 a year each to build. In a 20 match season , and with perhaps just two additional events per year, that brings the cost down below £30 per event. Whilst I accept that this cost will only just be covered by ticket prices in the early years, once moderate ticket price inflation is accounted for over 25 years the investment pays for itself. It doesn’t take into account the addition food, beverage and retail sales, as a result of the higher capacity.

The increase in net revenue as a result of the increased capacity:

Based on the above, a 54,000 seat stadium might be expected to cost around £450 million (assuming fixed costs of around £120 million). A 60,000 seat stadium using the above might expect to cost £504 million.

Using very conservative assumptions on ticket prices the 54,000 seat stadium would generate approximately £42 million, whilst a 60,000 seat stadium would generate £49 million from a 19 home game football season.

If we assume we borrow £300 million for the 54,000 seat stadium (i.e. 2/3rds of cost) the capital and interest repayments over 25 years at 5.25% are approximately £21.5 million, and for the 60,000 seat stadium, £336 million at an annual cost of £24 million.

The net income for a 54,000 seat stadium starts at £20.5 million, whilst the net income for a 60,000 seat stadium starts at £25 million. I stress this is based on a very conservative pricing model. If more aggressive (perhaps realistic) pricing is used then the difference between the two stadia increases proportionately.

Equally, if shareholder contributions in the form of capital increase, thereby reducing borrowings, the net figure continues to climb.

The point is that the higher capacity stadium assuming fully utilised, generates more income, thereby reducing the risk to financing a higher capacity stadium.

Ambition:

Ultimately, the stadium comes down to the ambition and willingness of the club and particularly the major shareholder to finance its build.

The business case is clear for a larger stadium. All the historic evidence based on other clubs is that new stadia attract far more spectators than most would reasonably model for. In addition, the figures above demonstrate the demand, and how a 60,000 seat stadium can be filled. It also demonstrates the significant increase in marginal income from the higher capacity, even before taking into account the higher food, beverage and retail sales from the higher footfall.

A higher capacity stadium also makes a statement to the footballing and commercial world, that under Moshiri we are re-building a club that not only can compete at the highest levels but is making the investment and commitment to be at the top-table once more.

When we built the new Main Stand at the end of the 1960’s we sold ourselves short on not putting a cantilever roof on, all to save £60,000 (6% of the build cost at the time).

Let’s not repeat the mistakes of the past, falling short of the highest standards and ambitions.

Anything less than the best and the biggest the site can hold reduces that claim, and condemns us to remaining behind our once peers. Whatever we decide in the very near future shapes the club going forward – it will determine the level of our ambition and our likely status in the game for generations to come.

Thanks for reading, apologies for the length of the article!

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Reader Comments (65)

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Ian Smitham
1 Posted 26/07/2018 at 21:10:18
Thanks for this Paul, some interesting learnings for me. Also, some assumptions that I assume you know more about than me.

One point I would like to add/query, why is the away support limited?? Is it a policing thing or what??

I am certain there are plenty of clubs who would more than take up an increased allocation: Newcastle, Tottenham, Arsenal even Man City seem to always fill that corner of Woodison they are allocated, never mind relative minnows in the early stages of the FA Cup and potentially the bigger clubs if we manage to make the later stages.

Maybe in line with your segmentation idea, lower prices for the casual, walk up supporter would surely increase attendances from that part of the customer base. And, though I expect the budgets need to be based on more robust assumptions than on people turning up if they feel like it on the day, maybe part season tickets at reduced rates for perhaps the less glamorous games would secure an income stream.

Any thoughts about safe standing too, again ATC lower cost for the ticket will surely attract more people to the game?

I believe it is a cultural thing and Roberts idea of lower ticket prices for differing segments must surely work. Once the habit of going to the game is established it is there and getting more and more people into the habit makes the club the natural place for the people of the city and from further afield to see as home.

It is almost about making the club a hub of the community, something I believe the board prior to Mr Moshiri have held close to heart and something I hope the club maintain.

Paul [The Esk]
2 Posted 26/07/2018 at 22:36:07
Thanks, Ian, max away numbers are limited to 3,000 (Premier League rules). Given the cap on away ticket prices (£30), most clubs are happy with that.

The club can do a lot to attract "walk-up" supporters and, to be fair, the club is excellent at selling matchday tickets – I do not see 10k walk-ups as a problem at all.

Your final point I agree with totally – we need a global outlook but must remain at one with our roots and local community

Steve Carse
3 Posted 27/07/2018 at 00:26:10
An excellent and irrefutable piece of analysis and projection. I get embarassed when reading the contributions of the naysayers amongst Blues who to my mind simply fail to understand the dynamics of football attendances or, much worse, the level, still, of support for our club.

Build it and they will come.

Derek Thomas
4 Posted 27/07/2018 at 00:51:28
The first step in making a rabbit pie is...first catch your rabbit. The rabbit in this case being funding.

61,878 and all that, not withstanding, given we have a fixed space site and an as yet unknown fixed (any) amount of funding. I remain convinced that the number of seats will be governed by the amount of money we have – not the commercial case for making it bigger.

Short termism, aka, the here and now, this is all we can borrow, will triumph over long-term jam tomorrow commercial gain... It's The Everton Way!

I've still put my name down for 4 season tickets in the new ground though and I expect to take my place in Aug 2024.

So get cracking, Moshiri, just build the 'kin thing!!!

Paul [The Esk]
5 Posted 27/07/2018 at 08:22:05
Derek (#4), I'm reliably informed by those in charge of the project we are still on course for the 2022-23 season.
Peter Lee
6 Posted 27/07/2018 at 09:30:31
It's not about numbers of people, it's about profit. Someone will have done the numbers on the link between potential sales and the price charged, the space for hospitality and the likely demand, likewise with premium seating.

If Moshiri is half the business man we believe, all that will have been done before any stadium planning. It will have defined capacity which defined the site.

52,000, suck it up.

John Hamer
7 Posted 27/07/2018 at 09:51:26
Great piece that seems well researched. Have you thought about sending this to the powers that be?

I think most fans want the bigger stadium as it sends out a statement of intent. Maybe the stadium will be built in a way that it is simple to expand, meaning they can make the initial build with a lower capacity and see how it goes.

Ralph Basnett
8 Posted 27/07/2018 at 10:06:32
Performances like last night and we will struggle with 6,000!!!!!!
Tony Everan
9 Posted 27/07/2018 at 10:08:45
I fear what we are going to get is 55,000 with the carrot of 60,000 if the safe-standing law is passed. This strategy may be cost effective, but flawed. Safe standing may never be allowed or may be forever banned at the first signs of trouble.

60,000 is a statement that we have the ambition, no player will ever need to leave to play in front of more fans alone. Anything less in today's Premier League environment is treading water. We will still be thought of as a mid-table club by anyone outside the city. Including future players we are trying to sign.

Joe Clitherow
10 Posted 27/07/2018 at 10:24:16
I thought you were making the case for Seamus Coleman there, Paul! Thought that was a done deal by now!!!

As for the stadium, we need a statement of future intent, anything less than 60k is failure for me.

Plus I don't think Bill Kenwright will ever sanction safe standing as Hillsborough has left deep impressions on him. For me, it is mixed: as a fit, strong 20-something standing was easy even in the frequent rough and tumbles. The good times were really good and memorable but the bad things (just someone tripping and people falling on top) easily overlooked and forgotten.

I think the big emotional highs and big lows are inextricably linked and making standing "safe" will water the whole thing down. I also think serious thinking around applying age limits excluding the elderly and the very young would have to be seriously considered and you can't have that. Standing – sadly – has had its day, I think.

Thomas Lennon
11 Posted 27/07/2018 at 11:08:52
I am not sure you factored this in but also remember the much larger number of people who attend using season tickets compared with the actual number sold. I used two season tickets that we owned as a group as it was simply not economical to go to every match for any of us. 12 people used those tickets last season and I understand the same situation is common elsewhere.

If 5,000 season tickets are used in the same way then we have maybe 20-25,000 'extra' people attending already.

You could well argue that it will be difficult to transform us 'part-timers' into season ticket holders in our own right, but it is less difficult to imagine many of those people attending more games on a walk-up or ticketed basis; I would certainly do so if I could get a non-obstructed view.

Paul Bernard
12 Posted 27/07/2018 at 12:52:30
Hi Esk,

I used to read your opinions on Grand Old Team IIRC.

I'm not that clued up with finances and such, therefore the article above was very easy to read by breaking it down into sub-categories (season tickets, corporates, day trippers etc).

I too think 60k should be teh aim, my opinion is rather simple to understand.

I visited Milan in 2012, they played Fiorentina in what was a category B/2 game. They anticipated a good turn out but no sell out.

What they did was close the top tier off, bearing in mind they are around 70k capacity, I think the figure was about 50-60k.

I think Man City originally opened their top tier to everyone (have to check that). Which meant that on TV the place looked half-empty against teams like Burnley, Southampton and Swansea for example.

My solution is that we build the 60k but only open the top tier of one side (circa 5k) for high demand games such as Liverpool, Man Utd and Arsenal.

We must also ensure we continue the great work done by EitC and include the locals in our plans. In particular, those who do good for the city (volunteers from charities etc), and school kids who perform well in their studies. This may only cover a couple of thousand seats, but with a fairly sized corporate plan, high demand for season tickets (I guess around 35k) and day trippers from near and far, we could easily sell 45-50k per game, plus the said 5k for big games.

Steven Rowson
13 Posted 27/07/2018 at 12:58:46
Here in Western Australia, we have a brand new world class stadium that seats 60,000 for Aussie Rules football. The local team at the old stadium used to average 32-35,000. They now average over 55,000.

The old stadium had been extensively modernised but without a big increase in capacity and the extra revenue this would generate; it was a failed exercise.

Whilst the two games are not directly comparable, the fans are turning up in droves because it is now easier to get tickets, the facilities are magnificent, and the spectacle is so much better.

We will only get one chance to get this right. I hope Everton bite the bullet and think big.

Tom Hughes
14 Posted 27/07/2018 at 13:12:27
This whole process has been arse-about-face from day one, but I think the article possibly being a bit over simplistic in parts.

Forget the whole Royal Blue Mersey headline. We have only ended up throwing all our eggs into the Bramley-Moore Dock basket because it promised massive funding via the Commonwealth games bid. Now that has vanished, the site can mysteriously only hold 52-55k now. Let's dispel that myth... there is no way that a site that could accommodate a 40k+ athletics stadium could only yield 55k in footy mode.

New stadium effect is a well documented phenomenon... as indeed is "new stand effect". However, we have to be careful extrapolating average uplifts at clubs who's old stadia were obviously far too small after the Taylor report. There are also some notable exceptions to the rule, and as many articles about stadium planning extolling the virtues of quality above quantity.

Stadium construction cost and capacity is not a linear correlation and can be almost exponential depending on format and structural complexity, and the planners have to overlay those cost curves against supply/demand data that the club should have in abundance to try to arrive at an ideal capacity.

However, there are a whole raft of questions generated by the project to date.

How have projected costs risen to £500M, when the same architect has produced a design for similar-sized stadium on a similarly sensitive site for less than £250M?

At that cost, aren't alternative sites or redevelopment beginning to look more attractive? At least with redevelopment, the club can test actual demand with each new section completed thus avoiding the risk of building expensive capacity that might not be filled, all at a far lower total cost?!

Thomas Lennon
15 Posted 27/07/2018 at 13:18:44
Tom, you are beginning to remind me of another remainer and leaver debate. Give it up, the decision is made (we think).
Erik Dols
16 Posted 27/07/2018 at 13:22:46
Joe (#10),

I live on the continent and I am genuinely surprised by your comments on standing. In Germany and the Netherlands, standing areas seem to be on the rise since they worked out the problems that were abundant in the '80s (and before). Teams like Bayern Munich incorporated them in their new stadium and actually increased standing capacity in the last years. I might be mistaken but as far as I know, all Dutch and German big clubs have standing areas in their stadiums. And to me, it provides a great boost in atmosphere, something that can go missing in bigger (50k+) stadiums that are all-seaters.

I do understand that in the city of Liverpool standing is an emotional subject due to Hillsborough but Dutch, Belgian and French football stadiums have been involved with deadly incidents due to unsafe standing in the same period as well – and made sure regulations came in place to provide safe standing.

I feel that safe standing in UK football is just a matter of time. Of course, I have a different perspective than most of you and could be completely wrong.

Paul [The Esk]
17 Posted 27/07/2018 at 13:31:40
Thomas (#11) – that's a very good point which I had not factored in, thank you.

Tom, I'm aware that the cost is non-linear, thank you, but the article is a simplified representation of a more complex pricing model. The article is intended for the widest possible audience, many of whom don't usually read this type of analysis.

Amit Vithlani
18 Posted 27/07/2018 at 14:04:33
Paul — a good stab at making a case using fairly common sense assumptions.

There are however two problems I see:

"Equally, if shareholder contributions in the form of capital increase, thereby reducing borrowings, the net figure continues to climb."

This is not accurate. Equity is more expensive than debt. It might eliminate the cash interest on the project, but equity holders demand a higher return than debt providers. To meet that return, ceteris parabus, greater equity means higher costs and therefore higher ticket prices.

You also do not take into account debt capacity. We live in credit constrained times. Raising more money on a project from the outset is hard. The extra £50M you surmise maybe the hardest part to raise. I don't know what sort of funding Everton can source, but I do know that relying on the council for funding is fraught with risk and the less we can borrow from them the better. With private sector funding capacity being finite it starts to put pressure on the financial outlay.


With this in mind it would be interesting to get your take on the following:

1. A debenture scheme for fans (crowd funding). I am sure there are a few people world wide who would happily put £5-10k each in exchange for a 5% return to fund the £50M needed for the extra 6,000 seats. They then get first option to buy a season ticket on those seats.

2. Multi-purpose income: I would like to see an investment in the facilities to make this an arena regularly used outside hosting our games. The benefit for the club would be enormous and the extra revenues would also help your case for a larger stadium capacity.

Do you have any thoughts on this?

John Kavanagh
19 Posted 27/07/2018 at 14:23:51
One more argument is international matches. With England set to leave Wembley and rotate around the regions and Fifa touting England as 2030 World Cup hosts, I would love to see BMD used as a venue rather than one of our old grounds down the road. Possible Europa and Champions League Finals as well.

Only an iconic 60,000 capacity stadium with excellent facilities for hospitality, media and people with disabilities is likely to achieve this.

Also events like concerts often only use 3 sides of the venue, so overall capacity can be important.

An expensive status statement I know, but it would be nice to restore the standing we had in 1966 – top ground and World Cup semi-final venue. Bragging rights, international awareness, NSNI and all that. Achievable if we don't keep over-paying on transfers!

Tom Hughes
20 Posted 27/07/2018 at 14:33:44
Thomas (#15),

LFC made the decision to move into the park and had planning permission in place for a decade before deciding on doing precisely what they said wasn't possible – redevelop.

Was that a hard or soft Brexit you ordered, sir? ;)

Rob B Williams
21 Posted 27/07/2018 at 14:54:20
Two Toms (14 &15). Like TL15 I do think that TH14 is seen as harping on about his pet subject – the re-development of Goodison Park and, like T15, I too would love to see T14 move on and accept what will be will be and, through his tremendous (apparent) knowledge, channeling that into a positive view of the Bramley-Moore Dock project.

I would like to hear T14's view on the capacity question and not the cost of building the infrastructure to meet that capacity – I am sure T14 has those costs at his fingertips but I am more concerned about filling the place.

Should (?) Usmanov or similar come on board we would have very little debate about the Cost of Construction. If we have the right people in place to market our product we should have far less concerned about the cost. IF we can muster a half decent team that plays attractive footie and moves us into those Champions League places we will be fighting for tickets and arguing that we should? have gone for an even higher capacity.

I too like many others am hoping against hope that what I hear on the street is not another Kings Dock/ or Bill cock-up and that this time we will actually have a stadium that we can all be proud of.

I have long been a supporter of T14's carefully costings but I believe that we are past that stage, the place will be built whether it is 52k, 55k or 60k, so let's get on with it as I'm running out of time to see the bloody thing finished!!!

Tom Hughes
22 Posted 27/07/2018 at 15:21:18
My pet project? Surely redevelopment is always the benchmark to measure all other options against, hence the reason why the vast majority have done precisely that.

Btw, I did vote for Kings Dock (ahead of redevelopment), so I'm not a bit averse to moving per se. I might also benefit from us going to Bramley-Moore Dock for a couple of reasons.

However, the article is supposed to be about justifying costs of moving and extra capacity. If it can be shown that the same capacity can be achieved elsewhere at a lower cost, and with less planning issues, then as Evertonians shouldn't we be interested? Or is it Royal Blue Mersey at any cost...?

Paul [The Esk]
23 Posted 27/07/2018 at 15:38:00
Amit (#18) your point about equity? The cost is born by the shareholders not the club, therefore for the club it is less expensive. That comes at a cost to the return on equity obviously.

The stadium is not going to be funded exclusively by debt. There has to be a capital injection of perhaps close to £200 million in the form of equity through a share issue.

Why do you say borrowing via the Council is more risky than borrowing from the financial sector? I'm of the opinion that LCC funding will be more onerous in terms of security and covenants, is that what you are referring to?

Amit Vithlani
24 Posted 27/07/2018 at 16:12:16
“Amit #18 your point about equity? The cost is born by the shareholders not the club, therefore for the club it is less expensive. That comes at a cost to the return on equity obviously.”

Paul, equity has a cost of capital, cost of which is not born by the shareholders. If I invest £50 in your project as equity, I expect a return. That return is a cost to your project. The return will be in the form of a share of the profits but its a cost all the same. The reason is that before I put my £50 in, you were getting all of the profits, say £100, which is all the project had to deliver to attract your investment. Now, I put my £50 pounds in and say I want £60 back. So your project needs to deliver £160 to both of us instead of just £100 to you. That's a cost. So you can't say a capital increase makes the net return higher: to attract the capital increase in the first place, the stadium project will need to generate higher returns if it is funded by equity as opposed to debt. The fact is equity is more expensive than debt as a source of capital.

“The stadium is not going to be funded exclusively by debt. There has to be a capital injection of perhaps close to £200 million in the form of equity through a share issue.”

Yes, but it still leaves a big number to be raised as debt. We live in credit constrained times and the greater the amount of debt needed the more difficult it will be. So I think the smaller stadium factors the realistic debt and equity that can be raised: the decision is not just about viability of the stadium but also about availability of capital. However a debenture scheme / crowd funding could help with this, don't you think? Also, as a multi purpose arena there might be ways of garnering advance payments from large promoters of concerts, etc? Do you think the club is being creative enough? Perhaps they are and we have not heard about it!

“Why do you say borrowing via the Council is more risky than borrowing from the financial sector? I'm of the opinion that LCC funding will be more onerous in terms of security and covenants, is that what you are referring to?”

LCC is a political body not a bank. If we rely on them exclusively to provide the loan that is needed, such a proposal could be shot down or become politically unpopular. It is fraught with risk in that regard. I would hope the club is finding alternative methods and looking into debenture schemes, crowd funding, front-loaded payments and any other more creative method of raising cash than simply relying on the council.

Rob B Williams
25 Posted 27/07/2018 at 17:16:45
Tom (#22),

"If it can be shown that the same capacity can be achieved elsewhere at a lower cost, and with less planning issues, then as Evertonians shouldn't we be interested? Or is it Royal Blue Mersey at any cost?"

Tom, of course we're interested... but is there another 'elsewhere' where those benchmarks can be met, other than Goodison Park? Are we to carry on ad infinitum going over and over old ground and getting nowhere – or bite the bullet and all jump into the Royal Blue Mersey up to our necks "at any cost or at best with a manageable cost".

John Pendleton
26 Posted 27/07/2018 at 18:22:32
I'm sure we can all play out different numerical scenarios to match our points of view. Tough to accurately estimate the transformative impact on attendance other than to say it goes northwards. My rough model:

GATE - 38.5k (Waiting list = 2k?) increase to 60k
Season ticket holders - 30k to 45k (+15k or x 1.5)
Corporate - 1.5k to 5k (+3.5k or x 3.3)
Walk ups - 7k to 10k (+3k or x 1.5)

So 60k requires the retention of the current gate and (from fans who currently do not attend any matches at all) to find another:

15k more season ticket holders
3.5k more corporate
3k more walk ups

So can we do it? Sunderland certainly did. We can too if we’re ambitious.

Personally speaking, if there is the promise of better football with guaranteed better facilities, better views, better access in a better setting then you can minus 1 from your occasional walk-up estimate and add 3 to your season ticket holders for the first season at least.

Tom Hughes
27 Posted 27/07/2018 at 18:29:33
Rob

The point I'm making is that there is a recurring theme here, and it certainly isn't my "pet project". I can't see any real process to date. We jump on a bandwagon, put the blinkers on and eventually we're forced to make the problem fit the solution, rather than the other way around. Then wonder were it all went wrong when it collapses into a pile of hokum.

The Dock is now too tight or too expensive, and we may have to settle for 52k for half a £billion? But at least we'll be by the Royal Blue Mersey... isn't that just a bit like Kirkby's Batman lights?

Ad infinitum? That's only because the planning and decision process has been hopeless to non existent thus far, and for over a decade before that. They've taken 2 years to just arrive at a capacity? A capacity that seems to be more than a little affected by limitations or costs dictated by the site. So, all-in-all, don't you think it at least merits an open mind on the issues?

Clubs generally relocate for 2 main reasons. The existing site is a complete non-starter (hemmed in by major infrastructure (main roads, railway lines or by listed buildings etc.) I which case they have no choice (as at Arsenal or Sunderland). Or because, there is a great alternative site with better infrastructure and or major financial incentives or enablers built into it. (This may even be a freeby stadium, as at Man City or West Ham).

In our case, the initial motivator was almost certainly funding via the Commonwealth Games, which may have covered the bulk of the stadium construction, and all of the infrastructure costs, plus the possibility of enabling developments too... That has all gone, and now the costs of the lot are falling on us. Hence, the talk of restricted site and reduced ambition etc.

As far as alternatives, at the time of Destination Kirkby, HOK were commissioned by Bestway to show that a 55k stadium was viable on the loop site. I think there was more than a little wiggle factor there too. Closer to town and all its infrastructure and hubs too. So, there are always options if the headline act doesn't turn up.

Rob B Williams
28 Posted 27/07/2018 at 19:42:34
Tom (#27), Thank you for that. By the way I initially said 'subject' not 'project' but lets not split hairs.

In a previous life I too was involved with number-crunching and examining the nitty gritty, so I know where you are coming from. I do not have your knowledge of the planning requirements nor the local knowledge required to 'site' this project.

I entered this thread on the understanding that 'Capacity' was the subject and not 're-location', restructuring, repeating or regurgitating what has by now become the accepted/preferred location for our new ground.

On that basis I am content to toe the party line, I shall leave the fund-raising, the infrastructure, the roadways leading in and out of Bramley-Moore Dock, the team selection and the whole shebang to others.

In a nutshell I tend to agree with your comments 'This whole process has been arse-about-face from day one,' and that Paul the Esk's article is 'possibly being a bit over-simplistic in parts'

I rest my case, m'lud. Lord have Mersey upon us!!

ps: I think we should go for 60,000 – We are Everton – how does our motto go, again?

Don Alexander
29 Posted 28/07/2018 at 01:24:39
This thread to me illustrates the huge depth of love we fans have for our club. I'm grateful that we have such savvy colleagues as Paul The Esk and Tom Hughes (and others too). As a bloke with zero experience of stadium construction or the mega-finance involved in such projects, it seems clear to me that the costs of creating Bramley-Moore Dock were hugely predicated on hosting the Commonwealth Games, and Liverpool failed to win that day. That must have been a massive kick in the nuts to Moshiri's pocket. He is, after all, a "mere" billionaire (singular).

The area around Bramley-Moore Dock could still provide the back-drop to any cold-war depiction of deprived Liverpudlian life, as it did in "Letter To Brezhnev" decades ago. And it's got way worse since then.

There are times in my 60+ years when I wonder why the club I love seems to be consistent only in shooting itself in the foot? I have the horrible feeling that the new ground, wherever it ends up, will be yet another wound.

Darren Hind
30 Posted 28/07/2018 at 10:57:59
Excellent post... and superbly countered, as always, by Tom Hughes.
Andrew Clare
31 Posted 28/07/2018 at 11:44:52
I really believe that the custodians of our great club have no idea of the standing and the fan base of Everton. Just with an ‘ounce' of success the club will be catapulted back into the big league.

Evertonian's have suffered mediocre football for many years now but they still fill their stadium and they still have the most passionate and loyal away following of any club.

Keep believing and build a 60,000 capacity stadium the success will then follow. Everton are a big club. Even with only one trophy in the last 30 years we are still the 4th most successful team in the country.

We have been badly let down by our recent custodians; please, Mr Moshiri, don't listen to them.

Gerard McKean
32 Posted 28/07/2018 at 12:25:37
My thoughts on a new stadium are more on an emotional level; if it's any less than 60,000, it is further evidence of an acceptance of a small-club mentality.

Paul makes a more logical and coherent case, which even the numerically challenged like myself can follow. The problem is that we do not have people like Paul within the club to make this case.

Paul clearly did not think much of Elstone's leadership but I wonder if he knows anything of his successor's qualities. I shall be generous and restrict myself to saying that she is never going to put the interest and ambition of Everton FC above her own; she will watch carefully to see which way the wind is blowing and then "advise" the owner with what he wants to hear.

Where was the due diligence when what we desperately needed was a Gazidis or a Cortese business and football brain?

Anthony Murphy
33 Posted 28/07/2018 at 12:43:09
Do we know if there is a limit to capacity based on world heritage status considerations and the physical makeup of the site? Could it be that it’s not lack of ambition or even finance limiting capacity?

Surely there is a suitable way of reducing capacity for lesser games? Got to be easier than having to extend if demand requires this. Hasn’t Meis said it can’t be extended once built?

Using safe standing seems like a logical step to vary capacity to me and before anyone repeats the point about sensitivity to the issue on Merseyside, let’s not forget the Kop stand for every game and have done for years...

Tony Everan
34 Posted 28/07/2018 at 15:00:57
Luzhniki Stadium

Capacity: 80,000

Completed: June 2017

Cost: $400m

The Ruskies built their big 80 000 one for £300m, I know there are many different factors but still, £200m extra for 25 000 less seats, does it add up?

Tony I'Anson
35 Posted 28/07/2018 at 16:32:27
Tom, are there any cost comparisons to draw on from other stadia re-developments, to give an idea of how much it would cost to increase the capacity of Goodison to 55,000 (or 61,878); including 5000 corporate seats; removal of obstructed views etc assuming it's deliverable in L4.

Also, is it worth considering that the board's view may be that the resale value of the club will increase much more with a shiny new stadium on a World Heritage site than a similar capacity version at Goodison? Owners come and go and all that.

Paul [The Esk]
36 Posted 28/07/2018 at 16:49:41
Tony #35, you make an interesting point re valuation of the club. I've spoken recently to a couple of board members on this topic, they were of the opinion the club was probably worth £400 million currently, and more than £700 million with Bramley Moore built (all other things being equal)

Obviously ballpark figures but no doubt the impact a new stadium has on club valuations.

Tony I'Anson
37 Posted 28/07/2018 at 23:01:05
Paul, interesting point indicates these conversations must have been had at board level. How much would EFC be worth as a 55,000-seater Goodison Park version compared to a Bramley-Moore Dock version at £700m? Would £500m be a conservative estimate?

So are these the discussions in the boardroom?

(1) Sell club tomorrow – £400m. Decent return for major shareholder after 2 years.

(2) Invest £100m On Goodison Park to get to 55k seats and sell for £500m. Roughly the same return as Option (1). Moshiri is a hero to fans for the contribution made to the club's progress.

(3) Borrow £500m for new stadium. Sell club for £700m on completion. Is this least profitable of options club has in the short term?

Very simple sums and lots of variables missed out, but is this basically the real world decisions they are faced with?

Inwould like to know your thoughts on this.


Will Mabon
38 Posted 28/07/2018 at 23:09:33
Not to claim superior knowledge to the board, but my own simple gut feeling is that, not too many years after completion of the stadium as planned, this club would be worth a billion if things continue as they are in football. Providing, of course, we remain in this league.
Paul [The Esk]
39 Posted 29/07/2018 at 17:37:49
Tony (#37), building on Bramley-Moore Dock is the most profitable option for the shareholders. Even with further capital injections, the uplift in value is due to the asset that is created and the higher income the stadium generates. The debt sits with the club, not the shareholders.

I know Tom will disagree but the redevelopment of Goodison option ceased to be viable a long time ago, so it's not worth considering from a value point of view.

Tom Hughes
40 Posted 29/07/2018 at 17:48:18
Tony (#35),

The cost of redevelopment is entirely dependent on the format and quality chosen.

If for instance the club simply chose to replace the upper Gwladys and upper Bullens, with new larger upper tiers to bring capacity up to 52-55k, then that needn't cost any more than £100m.

Reroofing the mainstand and adding lounge space and boxes too... and/or turning the Park end into the blue wall could comfortably take us upto the 60k+ mark all for a fraction of the rumoured £500m currently doing the rounds. Which is why so many of the larger clubs have chosen refurbishment against relocation. It might make it easier to sell the idea of the larger capacity too.


Tom Hughes
41 Posted 29/07/2018 at 17:51:53
"Ceased to be viable a long time ago". Precisely when and why?
Dan Davies
42 Posted 29/07/2018 at 23:29:25
52,500. Just build it! (With the option to expand, simple)
Don Alexander
43 Posted 29/07/2018 at 00:02:36
This "Waterfront-Stadium-Will-Make-Us-Viable" malarkey seems to be pretty much without foundation to me. To accountants and shareholders sure thing, but us fans? Hmm.

Anfield is also in a shitty (but not abandoned, yet) part of the city but is still filling out every week because of the football on offer, not the glorious view of it from Birkenhead or a (very) occasional cruise liner.

Then there's City, Arsenal, Spurs, Chelsea and United, all doing way better than us despite having super stadiums in photogenically unremarkable locations (and yes, I know Walton is the Ann Widdecombe of must-haves, but she does us all a favour by wearing clothes, unlike the stark-naked sterility of BMD for decades).

And what's their common denominator? Good to excellent investment in the squad, that's what, for years, the sustainability of which requires a bigger stadium, as cheap as possible in the comparatively impoverished North, to enable that very expenditure. Spurs are the latest to catch on.

But what do I know? I'm only a fan.

Derek Thomas
44 Posted 30/07/2018 at 01:54:14
Don @43; As a wiseman called Ebbo said; 'The top clubs aren't successful because they have big stadiums, they have big stadiums because they are successful.'

And you get successful by...winning stuff on a consistant basis.

54,000 vs 61,878; this will take 10-15 years to come out either way... and by then the world will have moved on anyway, taking today's goalposts with it.

This being The Ev, which ever road we go down will be the wrong one.

Maybe somebody can enlighten me, but if we go the 54k route, is it feasible down the track to tack on another 8-10k... I'm not too sure it is. I have the sneaky feeling that the cost of future proofing to allow this is about the same as doing it in the first place.

We'll do the least we can get away with, like having a cantilever roof with no pillars on the main stand for 10% extra of what we paid back in 1970. Or the bigger version of the Park End.

Tony I'Anson
45 Posted 30/07/2018 at 10:04:48
Paul (#39) given the current share distribution at EFC, are you saying that building a new stadium is for the benefit of a handful of people, mainly one? I can’t imagine any EFCSA shareholders are in it to make money.
Any mention of ‘uplift in value’ brings back other memories.

Tom (#40), even £200m sounds a lot less risky to the club, shareholders, stakeholders, partners, affiliates, sponsors, financiers et al. That’s why I was raising the point of comparing both end products, namely a venue with a much larger capacity of 55-60,000.

Is there a definite measure of sufficient reward to make the £500m risk worth it? Given efforts to date, I suspect the view of Mr Moshiri is Yes, especially if it’s not his own money being risked.

Tom Hughes
46 Posted 30/07/2018 at 11:51:59
I have to agree with much of what Derek and Don say.

I initially tried to post via my phone to Paul's article in direct response to some of the key points he makes unfortunately I was on a train and without my glasses and somehow managed to not submit, then lose it. I then responded quite quickly while I had a chance. So I will attempt to regurgitate it from memory.

I don't disagree with the analysis generally, but feel that there may be other factors to consider. I'm all for maximising capacity, but recognise that there can be several reasons why we might not push the envelope too much (especially in a complete new build). In stadium design it's often about the basic philosophy of the owner's approach. Many Italian clubs are desperate to get away from the vast municipal stadia, and have planned like Juventus to limit capacity to far less than their cavernous old grounds (sometimes even less than their best average attendances). Instead, hoping to cash in on the intimacy of tight British style stadia. The obvious benefits are that the limited capacity encourages full season ticket sales (which all clubs aspire to) and higher priced ticketing strategies, all while reducing that initial outlay for the stadium. Of course the theory being that there is a sweet spot where ticket supply/demand and construction-cost/capacity curves coincide to yield the best margins or ROI and a conservative approach is often the safer, with the fear of diminished returns for the speculative or more ambitious approach. We don't have to look too far to see the opposite end of the spectrum to Paul's philosophy. LFC have aired quite solidly on the side of caution . despite a fan base that dwarfs all others (bar Man Utd), they ditched the whole new stadium approach, and have opted for incremental redevelopment. Even then, they still set themselves ridiculously short ROI periods, having to justify every investment with the maximum risk-averse caution. This, despite literally having tens of thousands banging on the door to get in their stadium every week? Indeed, they adopted a similar approach at Fenway too. By comparison, we are probably being quite speculative just looking at 50k. We do have a solid (though aging) fanbase, and there is a waiting list nowadays, but how far can we really push it? The cautious amongst us could make a reasonably plausible argument for lower season ticket sales in a stadium where there is far greater supply of good seats.
"Stack 'em high, sell 'em cheap" might well work for West Ham, but importantly, they got the stadium for a pittance, and also have the "floating vote" of London's vast population to entice into its cheap seats. Similarly City to an extent, who let's face it can easily absorb any operating cost in anycase. However, if we're talking escalating costs for construction, that margin can disappear or even become negative very quickly, and shiny new can become white elephant. (Even before it's complete in Valencia's case).

I'm an Engineer and not really a financial type so I don't know if the figures do stack up for the greater capacity, with what we know at the moment. It's perhaps worth noting that when construction costs per seat are quoted, they often refer to the average cost per seat for the whole stadium not necessarily the cost of any new additional seats alone (although it is possible to break them down to individual sections sometimes), and the cost per seat of those additional seats will be dependent on several factors (that may be covered in your broadbrush estimates but we can't be certain without more info). I'm a bit wary of "rule of thumb" guidelines, but one often quoted is that for every 10k capacity increase you can often double the total cost. This is because Structural elements grow with volume of construction while capacity grows with area, which can result in an a highly disproportionate rate of cost per seat increase. Of course there are ways and means to mitigate against some of this via the design process, but Dan Meis seems to deny any notion of future expansion, or indeed the existence even the space required. Again, I feel this raises many questions about the site and the process to date.

Finally, I also get the attraction of the waterfront, and a truly state of the art stadium with capacity to meet all our current and medium-long term needs. I was part of a group who pushed for it as an option over 10yrs ago. Admittedly, I was hoping for a site slightly closer to town than BMD to increase the potential of enabling development. However, I can only reiterate that whatever sites are identified and whatever funding model adopted, they ALWAYS have to be measured against the only solid benchmark we have at GP, and the real opportunities that might represent. I don't believe that this has ever been done properly, as we always seem to jump on a bandwagon that has failed to deliver. Always sold to us as the only viable option when often they are precisely the opposite, and this might become far more of an issue than whether we get 52k or 60k+.

Tom Hughes
47 Posted 30/07/2018 at 11:53:50
Tony
Precisely!!
Brian Harrison
48 Posted 30/07/2018 at 12:25:18
Tom

You mention the Italian teams lowering capacity at grounds; I think this is because they just cant fill the stadiums any more.

Regarding Liverpool, I have a mate who has a season ticket which costs him between £2500 - £3000 per season. And he tells me that Liverpool want him to commit to this seat for 5 years, and they are also trying to get him to pay half of next season's ticket before a ball has been kicked for this season.

I know we often moan about things our club do but can you imagine if Everton tried to introduce this system?? He believes that they would prefer to have less season tickets so they can sell matchday packages for their overseas fans at exorbitant rates.

Jay Harris
49 Posted 30/07/2018 at 12:36:34
If Trevor Skempton is looking in, I would be interested to hear his views as an architect.

I know Tom and Trevor worked together on a scheme to redevelop Goodison Park which Kenwright chose to totally ignore but you guys know your stuff and it is always good to know the professionals' view.

Amit Vithlani
50 Posted 30/07/2018 at 13:31:24
Don at 43,

"This "Waterfront-Stadium-Will-Make-Us-Viable" malarkey seems to be pretty much without foundation to me. To accountants and shareholders sure thing, but us fans? Hmm"

It might be that Moshiri, Kenwright and their various mouthpieces have nailed their colours to the mast on the future viability of Everton being linked to a new waterfront stadium but, for me, it has never been cut and dried.

Like you, I am a humble fan. I am not an accountant, but I do know about the perils of raising large-scale financing in this environment and therefore staking the entire future of the club on

- a new stadium, which requires external parties to put money in; and

- making it big, because, you know, we are a big club.

It is just folly, in my book. I have no doubt I will be derided, as Nil Satis Nisi Optimum means that Moshiri should simply dig deep, find £500M and get on and build the damn thing. It will of course never happen – even if Usmanov were to appear on the scene – no-one in their right mind would write out such a large cheque themselves, in one go. The financial risks are simply too enormous to justify this, and, as I tried to make the point above, thinking that money from Moshiri or Usmanov is somehow cheaper than bank debt is simply not true. Their money comes at a very heavy price, which they will recoup back as shareholders, at the expense of all other shareholders.

This leaves us looking at other external parties providing a cheaper source of funding, such as LCC, to shoulder at least half the risk of the money needed. Now to those who say we will not survive as a club without this new waterfront stadium, basically what you are saying is that unless the LCC comes up with the cash, we will not be viable as a club.

Consider that position carefully. If our continued viability depends on a political body like the LCC, then in fact of all Moshiri's assurances to us of our financial stability mean nothing ("financial issues will be of no concern as long as I am a shareholder"). I do not recall him ever predicating those assurances on us building a new stadium.

Tom Hughes
51 Posted 30/07/2018 at 13:57:17
Brian (#48),

Yes, it's true that the Italian league has seen a big drop in attendances, but this has been because of several issues, including poor or aging stadia and various scandals amongst them. However, the fact remains that Juventus have averaged well above their current capacity on many occasions.

Similarly, Roma's and Milan's average attendances have eclipsed their proposed new capacities on many occasions too, and if you were planning for your new home for the next 50 years or so, you would probably like to think you might be able to accommodate some of the averages (nevermind highest attendances) of yesteryear.

I'm not really advocating the LFC approach as such. I'm simply trying to show the contrast, and tbh your friend's experience illustrates the power of what controlling supply can achieve. I'm not sure which part of the stadium he sits in, but I have lots of friends who don't pay anything like that much. So, he may be the extreme case, and therefore not entirely indicative.

Put it this way, we are not even in a position to ask exorbitant prices for our limited capacity, so there are some obvious limitations in any comparison, but rest assured if our club could, it would. So, it's not a question of our club's morality, but more the size of their respective fanbase, that creates that issue.

Paul A Smith
52 Posted 01/08/2018 at 12:36:28
This is a great thread. 60,000 or stay at Goodison Park. Someone tell me why we want a stadium around Sunderland's bracket?

The true ambition of the club will come to light with the new stadium size. Let's see how brave and big Everton want to be. There's plenty of scope for new fans coming to the game.

Dennis Stevens
53 Posted 01/08/2018 at 13:09:54
I'd prefer both, Paul. Stay at Goodison Park and redevelop to 60k. I doubt it would cost half of the proposed Bramley-Moore Dock development.
Tom Hughes
54 Posted 02/08/2018 at 08:31:21
I read recently that Wolves were also considering 55k expansion, so perhaps Paul is right, and 60k is where we should be looking. Unfortunately, the party-line according to Mr Meis appears to be saying that is not possible at BMD (btw, I don't believe that for one minute, unless some transport/infrastructure or heritage-impact study we don't yet know about has caused it). So, with reference to the theme of the discussion, as a simple box-ticking exercise, GP can readily be redeveloped to 60k+. Next article: 52k BMD @£500m or 60k GP <£200m??????

Dennis Stevens
55 Posted 02/08/2018 at 08:45:24
Aye, Tom. A phased redevelopment of Goodison PArk at half the price, delivering a larger capacity than that proposed for BMD. All we need is for Moshiri to decide he has a more viable alternative plan for BMD!
Tom Hughes
56 Posted 04/08/2018 at 01:41:30
Dennis,
A number of years ago I was asked by a red friend of mine to do a sightline study of LFC's mainstand, basically to see if or how it could be extended/ redeveloped. I managed to get some drawings and showed how 8-10k could be added on that side alone, including a corporate tier, with scope to extend that around the corner to add a further 6-9k at the Anfield Rd end. This was prompted by the club's initial plans to move into the park. The club plain refused to accept the viability, obviously having set their hearts on the whole new build, and having invested heavily in that. 2 changes of owners later, and the supposedly "unviable" became the reality! With similar proportions to the outline scheme I looked at over 10yrs previous. The Bullens Rd stand could be far less problematic or costly, and result in a superior format too. However, as with the LFC example I think it would require major changes to change the focus, or to make them seriously consider any options. If the finances can still be made to work for BMD, and it is seen as the way forward for either Moshiri, club or both to profit, then that will always remain the focus.
Christine Foster
57 Posted 04/08/2018 at 02:52:11
Excellent and balanced thread, with contrasting views on viability versus expectation. However underpinning all of this debate is motivation of the board. Legacy, profitability of future sale and short term profit.
Tom Hughes is, as always, spot on regarding the viability and cost of redevelopment of Goodison Park, but alas the board want to increase / maximise, the potential sale value of the club. Selling a revamped stadium will not maximise shareholder profit when there are financial debt models to minimise personal exposure. Whilst short term ROI my be better with a redevelopment, it will be much harder to offload for megabucks at some future date.
The previous board showed their colours with DK and the site and players may be different but the objective has always been the same. Personal exposure vs Personal profit.
On an operational level, rather than a shareholder one, a 55 stadium that's full every game is the objective but lacks the ability to cope with success on the field. Should / when it comes. I think the debate tells us more about the vision of the board rather than the success of the club.
Tom Hughes
58 Posted 04/08/2018 at 21:42:11
I generally agree Christine. As someone interested in the nuts and bolts of the whole stadium question, I'm slightly wary of delving into motives of owners etc, (as invariably it's highly speculative only, and soon becomes a minefield on forums), but I do think we have to try to read between the lines sometimes, and question those motives when some of the decisions seem fundamentally flawed, as was the case for the failure of KD, the many failings of DK, and now (for some) regarding capacity.

The thread is about the merits and viability of pushing the envelope to 60k, and by extension I suppose the potential to go higher still in the future, if success demands it. What happens then? Do we simply have to start again elsewhere constrained by a stadium/site that cannot be expanded, before we've even paid for it?

I disagree about the resellability of a club with a refurbished stadium. It's all very much dependent on the quality of the redevelopment. After all if the new build comes with far more debt, then that itself might be a bigger deterrent than enticement. Also, we have to remember that most of the biggest clubs in the world actually play in stadia that have been redeveloped over decades, and have no problems being sold on. I get the argument about having a flashy new stadium on the waterfront, but not just to be packaged to maximise profits for an outgoing owner. We don't want to simply be a vehicle for short-term-gain merchants, whereby we're left with the long term debt.

Christine Foster
59 Posted 05/08/2018 at 00:20:05
Like most things in life, truth is a perception, not fact. A version of fact influenced by a perception... so what? Well, an iconic stadium on the banks of the Mersey, with hotels, shops and business will push up a mean value far faster than a redeveloped stadium in Walton road. The perception is a flagship for a redeveloped area that will attract people and investment. Good for the city, the club and most of all the investors.
I hate to say it Tom but as much as I would love to see the old lady reborn, the lure of a better selling piece of real estate is more of an attraction to the board. It's like they say, location, location, location. .

In the boards eyes it's a win,win scenario.. iconic stadium, much herald for years to come, easier to obtain outside funding, proactive council, improved resale value of the club, Greater potential for ongoing commercial profit and shareholder gain.

Thems the reasons it's being done but I doubt the board would issue a confirmation of it.

Tom Hughes
60 Posted 05/08/2018 at 01:28:19
I understand that Christine, and it all sounds perfectly plausible, but at what cost? I'd also probably be far more inclined to agree with the location argument if this was the Kings Dock, and not a dock adjacent to a sewage plant 2 miles away from it. At the far end of a development scheme that has failed to get off the drawing board in over 10yrs, with it seems to be almost zero prospect of any major enabling developments around it to add leverage. It's almost as if the stadium will not be acting as a catalyst for redevelopment at all, but a book-ended appendage at the hard-to-sell periphery of a scheme that has struggled to sell even the rich end. There is massive potential of course if the whole scheme comes to fruition, but we might end up high and dry if not. Of course to less high profile extent, there are opportunities for inner city regeneration joint-venture projects in Walton with GP the centre-piece. Perhaps without the massive bill, and perhaps more importantly without the feared limit on capacity that has driven this thread?

As Evertonians we're surely more concerned about what's best for the club rather than what's best for the owners. As has been shown many times, both are not necessarily mutually inclusive.

Dave Lynch
61 Posted 05/08/2018 at 03:15:10
As much as I hate to say it.

All of us over a certain age (I'm not far off 60) will never see BMD or a redeveloped Goodison for that matter.

I have totally given up on the ground move, all we hear are sound bites, promises and... well bullshit really. From a board that has let us stagnate and fester for the past 20 odd years.

I am now of the opinion that BMD is a no-goer and the club are "again" stringing us along until someone sprinkles fairy dust on them and magically comes up with a viable solution that won't cost them much money.

They will then try and convince us that this solution is the way forward and in our best interest. Thank the lord we saw through that bullshit with regard to Kirkby, or we'd be dead in the water by now.

Christine Foster
62 Posted 05/08/2018 at 07:21:09
Tom actually agree with all you say, and yet the decision is being made not for the best footballing reasons but for what's best for the major shareholders. As you say, it's not KD and as far as it goes it's an enabler for a regional development scheme that until now has had no focus.
That aside, it does have the potential to succeed even though redevelopment of Goodison is cheaper, easier and quicker. Once again it's perception and one has to ask under who's objectives has the decision been made.
Yes, if it all works we will have an iconic stadium in a thriving area, but more likely that will only happen on a much longer time frame The Stadium may be built with its associated attractions but the general area will take many more years to flourish. In a way I welcome the stadium build there because I was born and raised in that area, I still have family there, and it's lacking any scheme to bring focus and life to what was a major area of fan base in the city, long time ago when we was fab.
Amit Vithlani
63 Posted 05/08/2018 at 08:01:12
Christine @ 59. I think you will be proven right if the LCC stumps up half the cash.

If not, I cannot see a case for anyone risking 500m. Not in this environment.

Moshiri is a savvy player. LCC could justify a boat load of cheap cash where there is a regeneration angle as in BMD. For whatever reason, no such angle is available in redeveloping Goodison.

For the shareholders, it becomes an awesome result. A highly marketable asset is procured with a truck load of cheap funding. Then all of your theories on re sale value of a club with an excellent piece of real estate fall into place.

In addition, I cannot see 50m being spent at this moment on extra capacity. I disagree with The Esk that there is a business case - not unless 50m is sourced from the LCC or crowd funding / fan debenture schemes or advance payments from concert organisers.


If the LCC do not provide the money then my view is BMD will die a death.

Even Usmanov's presence would not likely justify the risk.

The only way I can the private sector fully shouldering the costs of a new stadium are:

- Substantially increased club revenue streams and profits which make this a safer lending proposition than it is today. Everton do not earn enough today as a club to justify return on the type of investment needed.

- A significant and extensive fund raising exercise with banks, bond markets, crowd funding, sponsors, naming rights, concert organisers

- A healthy sale price on Goodison

This will not be as cheap as LCC money but, if it raises 350m and reduces what Moshiri has to fund to a less risky figure (e.g. 150m) then I suspect BMD will still get done.

My theory (and it is only a theory) was that the base case funding split for BMD was:

-250m LCC
- 100m other sources (selling GP, bank debt, naming rights etc)
- 150m Moshiri.

Why do I think Moshiri will put only 150m for the stadium? If it is is invested in exchange for more shares in EFC, I believe it takes him up to about 400m - 450m outlay for around 76% of the club :

- 87m spent to acquire shares

-150m spent clearing debts and funding transfers in 2017

- I am guessing another 50m provided this year

- 150m for the stadium.

There is an Echo report saying he has a deal to go to 76%. So if his outlay is around 437m, it values the whole club at 575m.

Paul mentioned that he heard the club would be worth a billion post BMD completion. If true, Moshiri's stake would be worth 750m. Sounds alot, but when you consider that he invested 437m, that there are risks (such as thr club needing to spend more on players or not earning enough) then the returns look fair. Typically, private equity investors look for 3x their money invested over a 5-6 year period, so on that basis, Moshiri's 76% stake would need to be worth 1.3bn if he invested 437m or 2.4bn if he footed the entire stadium cost and pumped in 800m (with Usmanov's backing).

These are awfully pie in the sky numbers to achieve at this point in time.Consequently, I can't see room for the extra 50m Paul is speaking of, especially if Moshiri and his team have to replace the LCCs funding share (which seems to have gone quiet).

Perhaps, if they fail to secure the LCC share, redeveloping GP will, as Tom has alluded, become miraculously viable (as it did for our evil neighbours).

Just my tuppence.

Paul A Smith
64 Posted 06/08/2018 at 12:04:47
Apologies if I come across too blunt or arrogant in my posts. I do get fed up of textbook comments and gullible people believing every word the club say.
A few mates and myself are in a group chat and regarding this thread I found its always better to ask questions no matter what.
One of the lads added this today regarding fans opinion.
The board are aware of the fans wishes but they keep letting out propaganda out as to why they can't.

"site only big enough for 55,000"
When the site is bigger than anfield.

But this is the best one and they've even got Meiss to say it often:

"the last seats to go in cost the most and generate the least income"

Even fans repeat this now as fact because they have heard Meiss say it. But I question it. It goes against all logic.

Economies of scale in most forms of production usually result in price per unit of production falling.

In the case of buying more seats, more steal, more brick you can negotiate better price per meter, kg, unit or whatever.

Then they themselves new stadiums cost 6,000 per seat to build. Which means a 55,000 seat stadium cost 6,000 per seat and 60,000 costs 6,000 per seat.

So they are full of it.

The cost of putting a ridiculous kink in the roof behind the goal end and erracting that stupid screen is probably more than another 5,000 seats.

If they only want a 52,000-55,000 just say so. Stop treating us like we are stupid by conning us. And getting Meiss to tell lies as well. It's corporate nonsense we have been through before.

Sending us surveys with questions they obviously know what our answers will be. Then using the survey to suggest they've delivered the ground we asked for.

Come on blues, lets not keep getting sold short.

Tom Hughes
65 Posted 08/08/2018 at 02:09:58
Paul,
I agree with the overall sentiment of your post about being misled etc.

However, quoting cost per seat of other stadiums can be misleading. It is very much dependent on the design format and capacity. In a multi-tiered stadium the upper tiers can cost several times that of the lower tier per seat, so the lower tier may be as low as £1-3k per seat, with the upper tiers anything from £3-10k per seat, which may produce an overall average of £6k per seat for a stadium of 50k+. That's why lower league clubs can build their small, basic single tier stadium with cost of little more than £1000 per seat. Open corners also reduce structural complexity and costs (which is why Destination Kirkby had open corners, allowing for 10k more seats in the future).

So, if you build a complete bowl and need to add say another tier to increase capacity in the future, they can be top end in terms of cost to build, but if the stands are already quite big then being in the gods the new seats are then bottom end in terms of quality. Of course, that can be mitigated against, by designing in cheaper expandability in lower tiers too and/or utilising overhanging tiers to reduce footprint and roof area from the start etc.

I also don't believe that the site can only accommodate 55k. However, if that is the case, we should've known it long before even the first survey, and it should've been a non-starter from the beginning. So I agree, we do have to question the validity of some of those comments and statements in recent weeks.

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