West Ham and the Olympic Stadium – the CAS Trust position

Following the series of articles in the Guardian earlier this week, the issue has been picked up by more media outlets, and seems likely to gather momentum. We have prepared the following general press release, and are already discussing it with interested journalists.

Charlton Athletic Supporters Trust, West Ham United and the Olympic Stadium

Charlton Athletic Supporters Trust is seeking a review of the terms of West Ham’s rental agreement at the Olympic Stadium. We believe the current agreement (most details of which have still not been made public) is prejudicially favourable to West Ham. This should be a matter of concern for all taxpayers; we are involved because of the specific commercial impact it will have on Charlton Athletic FC.

CAST is not opposed to West Ham playing at the Olympic Stadium, and acknowledges the need for a viable legacy for the stadium. We believe that the terms of the agreement put far too much financial burden on the taxpayer; and that as a result West Ham will feel able to offer heavily discounted tickets south of the river in Charlton’s catchment area, which is now well connected to the Olympic stadium thanks to the transport links built for the games. This presents a severe commercial threat to our club, whose long term future it is our mission to care for and seek to preserve. A re-negotiation of the contract which requires West Ham to pay more will oblige West Ham to focus more on filling the stadium with core West Ham support paying prices similar to those at other FAPL clubs in London.

Regrettably the London Legacy Development Corporation have resisted all attempts by CAST to inspect the rental contract, even under Freedom of Information law. CAST has a complaint lodged with the Information Commissioner (since last October). The length of time this is taking indicates that the LLDC are determined to conceal from the public the extent of the support from public funds West Ham are getting. The extent of the LLDC’s obfuscation can be seen on this website where we made our FOI request

However, some figures have been put in the public domain (see attached factsheet) and illustrate that West Ham pay far less rent than for example Ajax Amsterdam pay for a similar stadium - yet West Ham have far more revenue from TV rights than Ajax. West Ham will pay only around 8% of the cost of refurbishing the stadium, whereas Manchester City contributed 50% of the cost of refurbishing the City of Manchester stadium. West Ham will easily meet these costs through the sale of Upton Park. The most important advantage though is that West Ham are allowed to keep 100% of “corporate” match-day revenue. The Olympic Stadium has a huge capacity for this type of customer. We believe that if West Ham sell this capacity, and achieve attendances of around 35,000, their revenue will be such that they can treat the 19,000 spare capacity as “promotional”. They can afford to offer these seats at a discount in order to build their support in new areas, particularly in South-East London. This is the scenario that concerns CAST.

Put simply, the taxpayer should pay far less of the capital costs than is currently planned, and West Ham should pay back far more in rent to the taxpayer. If this re-balancing were to take place, West Ham will still have excellent commercial prospects, but they will not be able to threaten the commercial health of other clubs (particularly Charlton) using taxpayers’ money.

CAST, West Ham United and the Olympic Stadium; Factsheet

What is known about the terms of West Ham’s deal?

Annual rental has been reported at £2.0-2.5m by various media outlets, and not disputed by West Ham. However CAST has also discovered that the rental agreement allows for an unspecified reduction in rent if West Ham are relegated (source: LLDC submission to the European Commission in response to CAST complaint about unfair State Aid). By comparison, Manchester City pay £3m/year (source: Wikipedia), while Ajax Amsterdam pay €9m/year (source: Guardian, 20.4.15.)

Capital Cost contribution towards the rebuild of the stadium has also been widely reported as £15m. Rebuild cost is now estimated at £196m, so West Ham contribute less than 8%. By comparison in Manchester, the City and Manchester City FC each contributed 50% (£20m each) of the respective conversion costs at the City of Manchester Stadium (source: Wikipedia)

West Ham can more than meet these costs by selling the Boleyn Ground; the deal stipulates that West Ham do not need to pay their tiny share of the conversion costs until they have completed this sale (source: LLDC submission to the European Commission in response to CAST complaint about unfair State Aid). In West Ham’s 2013 financial accounts, the Boleyn Ground is valued at £71m.

The rental agreement currently allows West Ham to keep 100% of revenue from corporate hospitality. (source: LLDC submission to the European Commission in response to CAST complaint about unfair State Aid).

By comparison...

The Emirates Stadium cost £390m, and Arsenal had to fund every penny because “the club was not granted any public subsidy by the government” (source: Wikipedia).

For more information:

Please contact Steve Clarke, Chair, Charlton Athletic Supporters Trust;
tel: 07500057067