New Wembley stadium may cost record £660m

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The Independent Online

The final bill for the new Wembley stadium could reach £660m, three times more than originally expected, according to Wembley National Stadium Limited (WNSL), the Football Association subsidiary in charge of the project. It would make the stadium the most expensive ever built.

The final bill for the new Wembley stadium could reach £660m, three times more than originally expected, according to Wembley National Stadium Limited (WNSL), the Football Association subsidiary in charge of the project. It would make the stadium the most expensive ever built.

WNSL said that ordinary supporters would not be forced to pay for it through inflated ticket prices. "In the same way that airlines can afford to sell the majority of their seats at affordable prices because a minority up the front are paying a premium, so we'll keep ordinary seat prices down through our corporate and hospitality income," a spokesman said. He added that WNSL has a contractual agreement with the Lottery Commission, which has given £103m to the project to buy the land for the new stadium, to peg seats at 1999 prices plus inflation.

The new Wembley is planned to hold 90,000 people and include a four-star hotel, offices, banqueting halls, restaurants, a museum and numerous corporate hospitality suites. Of the 90,000 seats, around 76,000 will be available for each football match to ordinary fans, with some 8,000 spaces allocated to hospitality boxes (where WNSL will make its largest profit margins), and another 6,000 "club" seats, which will be sold on a season-by-season basis to clubs around the country.

The £660m cost of the project estimated yesterday is a "worst-case scenario" cost, said the WNSL spokesman, and covers all possible overspend and delays between now and 2003 when the building should be finished. Of the £660m, £410m will need to be raised via City institutions, which are expected to be willing to provide the money. The rest has already been paid by the Lottery Commission or pledged by the FA as contingency funding. Much of the finance from the two latter sources was pledged because Wembley had been the centrepiece of England's bid to stage the 2006 World Cup. The funding remains in place despite that tournament being awarded to Germany in the summer.

Wembley's current income is around £15m a year but that will need to increase to at least £30m a year after rebuilding just to pay the interest on the loans needed to finance it. Within a few years of the stadium's opening, this figure could rise to between £40m and £50m to cover loan repayments.

WNSL said that projected revenues should cover this, not least because it, rather than outside sub-contractors (as at present) would be the main beneficiary of the lucrative hospitality market.

When the project was first suggested more than four years ago, the cost was estimated at £240m, but for the past year, WNSL has been quoting a figure of £475m. The Stade de France in Paris and the Olympic Stadium in Sydney cost around £260m each, although the WNSL spokesman said yesterday that Wembley's construction costs of £326m compared favourably, and added: "In any case, Wembley will cost more because it's better."

The spokesman added that, unlike in Australia and France, WNSL's published costings included the price of land purchase.

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