Yeah, you know what ? You're right, it's all a big conspiracy. No one negotiating on behalf of the LLDC has done any calculations or estimates. West Ham just threw the 100K figure at them and they figured "Yeah, that should cover most of the costs...". It's a real shame that the LLDC wasn't made up of Charlton Athletic fans in the first place. With the money coming in from West Ham to the taxpayer as a result the government could probably open another 25 hospitals in two years time all over the country...
"We have already released much of the detail of the contract with West Ham United but there are certain elements that cannot be made public as they are commercially sensitive. We have appointed an operator to manage the Stadium on a day-to-day basis and part of their role is to attract other sports and entertainment into the venue. If other parties were aware of the detail of the West Ham contract then it would make it very difficult to negotiate the best deal possible which would in turn have an impact on the taxpayers’ investment."
This is quite common in business practice, innit ? You are adamant this is about the best use of taxpayers' money, well, that's what Vinci/LLDC are trying to do by keeping certain figures out of the public domain for the time being. The best way to handle the taxpayers' money would have been to incorporate a footballing option in the design of the OS for post game multi purpose usage. That hasn't been done. Next best thing would have been to sell it to a club, either keeping an athletics legacy or not. This didn't happen either, not with Spurs, not with West Ham. The rent solution is the least attractive option for the taxpayer, but apparently still preferable to the white elephant option. For the final bidding process West Ham were the only big club left going in with a bid which gave them a terrific negotiating base. So the LLDC was still looking for the best possible deal. Which for them might have been an amount X for rent, naming rights, catering share, corporate seats/lounges income share etc. But West Ham as mentioned were the only viable solution left which the LLDC knew and West Ham too. So West Ham said: We are only prepared to pay amount y, take it or leave, we might as well stay where we are.
I understand you are concerned about the competitive balance in English football as it obviously already is a level playing field for all clubs up and down the divisions as it is. I very much doubt (especially once a court sees the deal between the LLDC and West Ham in detail) you will find any court in Europe (or FIFA) that will force the parties to renegotiate. It may give you a good feeling of having done something about big bad West Ham and the know-nothing twats in government and public services. It'll still be ultimately futile. The European Commission already said they don't see a case of state aid here.
West Ham were always the only viable solution, which makes the statements about an open tender a touch disingenuous no?
West Ham would have to have been asked to pay an awful lot more before it made more commercial sense to stay at Upton Park. That the LLDC didn't get that is damning. That they aren't up to negotiating big contracts should be as big a concern for the taxpayer, and such naivete is also behind their anticipated inability to be able to negotiate with anyone else if they release the details about this one. Either they believe in their product or they don't.
This isn't really about West Ham per se, more 'Naming Rights United'. That is, it's about the deal - because anyone would have received an unfair, state-sponsored advantage.
I do like the term Hamsters, I fail to feel insulted by that term...you'll see soon enough what other events will be hosted and you probably will also get to hear how much Vinci (and the taxpayer) will make from bringing in those events. Look at what Vinci usually does, they will not come in and run the OS for merely overseeing West Ham in there, they will make sure that the OS is busy all year round, even with the setup times involved whenever West Ham play there. I read West Ham have the OS for 25 games (included in the rental deal), each additional game (cup runs, European Cup, preseason friendly against Barcelona) will cost West Ham 100K.
This is from a letter from Denis Hone, chief executive of the LLDC: "In broad terms the deal provides WHU with a 99 year lease, which ensures the stadium has ongoing, year round use. With regards to financial payments by the club, they have made public their £15 contribution to the capital costs of transforming the stadium which is personally guaranteed by the owners. They will also pay an annual index linked usage fee which more than covers the cost of them hosting matches at the stadium. LLDC also negotiated a two pronged protection of taxpayers interest: WHU will pay the grantor a percentage of the uplift of the value of the club should the owners sell their shares after their move to the stadium, and if WHU's performance exceeds their baseline assumptions, the LLDC will receive performance payments. All annual and performance payments are RPI linked"
And this is from a West Ham spokesman in April 2015:
"Indeed, the European Commission looked into a complaint in relation to our move to Queen Elizabeth Olympic Park in 2013 but 'decided not to further pursue' the matter. "The club was selected as anchor concessionaire following a fair, transparent and robust process that was open to any group or organisation in the country."
Could you explain how future negotiations are harmed by publishing (i) the detail of the clawback clause (ii) detail of performance payments (iii) the amount Upton Park was sold for?
Yeah, you know what ? You're right, it's all a big conspiracy. No one negotiating on behalf of the LLDC has done any calculations or estimates. West Ham just threw the 100K figure at them and they figured "Yeah, that should cover most of the costs...". It's a real shame that the LLDC wasn't made up of Charlton Athletic fans in the first place. With the money coming in from West Ham to the taxpayer as a result the government could probably open another 25 hospitals in two years time all over the country...
What are your sources for the following two facts in your post?
£100k per additional game over and above the 23-25 in the original deal West Ham paying enough over two years to open 25 hospitals
Remember, links are good, random press releases not so good.
I take quite a bit of info from various West Ham sources, yome turn out to be true, some less so. That 25 game thing is easy enough to manage, 25 games included in the rent, if at the end of the season you have more games than 25 then each game on top is another 100K in the coffers of the LLDC. Of course there may be seasons when no additional games will be needed anyway due to early cup exits, no Europa League (nevermind CL) and maybe just one friendly or preseason game.
You assume there's no rebate if West Ham release an event date. Bet that's under the black ink.
Barry Hearn reckons there is space for only 30 more major event days in the stadium. I suspect that might be further restricted by the 7 days it takes to retract the seating (and 7 more to restore it again). Vinci are going to have their work cut out, I think. Athletics only have 3 months to use it, after all.
By the way - 12,000 sq ft seems to be included in that rent as well, so £100k might be wishful thinking. Plus I think there's every chance that the business case starts to lose money after match 25.
"We have already released much of the detail of the contract with West Ham United but there are certain elements that cannot be made public as they are commercially sensitive. We have appointed an operator to manage the Stadium on a day-to-day basis and part of their role is to attract other sports and entertainment into the venue. If other parties were aware of the detail of the West Ham contract then it would make it very difficult to negotiate the best deal possible which would in turn have an impact on the taxpayers’ investment."
This is quite common in business practice, innit ? You are adamant this is about the best use of taxpayers' money, well, that's what Vinci/LLDC are trying to do by keeping certain figures out of the public domain for the time being. The best way to handle the taxpayers' money would have been to incorporate a footballing option in the design of the OS for post game multi purpose usage. That hasn't been done. Next best thing would have been to sell it to a club, either keeping an athletics legacy or not. This didn't happen either, not with Spurs, not with West Ham. The rent solution is the least attractive option for the taxpayer, but apparently still preferable to the white elephant option. For the final bidding process West Ham were the only big club left going in with a bid which gave them a terrific negotiating base. So the LLDC was still looking for the best possible deal. Which for them might have been an amount X for rent, naming rights, catering share, corporate seats/lounges income share etc. But West Ham as mentioned were the only viable solution left which the LLDC knew and West Ham too. So West Ham said: We are only prepared to pay amount y, take it or leave, we might as well stay where we are.
I understand you are concerned about the competitive balance in English football as it obviously already is a level playing field for all clubs up and down the divisions as it is. I very much doubt (especially once a court sees the deal between the LLDC and West Ham in detail) you will find any court in Europe (or FIFA) that will force the parties to renegotiate. It may give you a good feeling of having done something about big bad West Ham and the know-nothing twats in government and public services. It'll still be ultimately futile. The European Commission already said they don't see a case of state aid here.
West Ham were always the only viable solution, which makes the statements about an open tender a touch disingenuous no?
West Ham would have to have been asked to pay an awful lot more before it made more commercial sense to stay at Upton Park. That the LLDC didn't get that is damning. That they aren't up to negotiating big contracts should be as big a concern for the taxpayer, and such naivete is also behind their anticipated inability to be able to negotiate with anyone else if they release the details about this one. Either they believe in their product or they don't.
This isn't really about West Ham per se, more 'Naming Rights United'. That is, it's about the deal - because anyone would have received an unfair, state-sponsored advantage.
According to July's LA v LLDC minutes it is Vinci that have to find other users and negotiate contracts. LLDC and Vinci have a profit (?) sharing agreement. The minutes also say that WHU and Vinci are the only OS contracts let to date.
I take quite a bit of info from various West Ham sources, yome turn out to be true, some less so. That 25 game thing is easy enough to manage, 25 games included in the rent, if at the end of the season you have more games than 25 then each game on top is another 100K in the coffers of the LLDC. Of course there may be seasons when no additional games will be needed anyway due to early cup exits, no Europa League (nevermind CL) and maybe just one friendly or preseason game.
You assume there's no rebate if West Ham release an event date. Bet that's under the black ink.
Barry Hearn reckons there is space for only 30 more major event days in the stadium. I suspect that might be further restricted by the 7 days it takes to retract the seating (and 7 more to restore it again). Vinci are going to have their work cut out, I think. Athletics only have 3 months to use it, after all.
I read somewhere that athletics use is only third week of June to end of July.
I take quite a bit of info from various West Ham sources, yome turn out to be true, some less so. That 25 game thing is easy enough to manage, 25 games included in the rent, if at the end of the season you have more games than 25 then each game on top is another 100K in the coffers of the LLDC. Of course there may be seasons when no additional games will be needed anyway due to early cup exits, no Europa League (nevermind CL) and maybe just one friendly or preseason game.
You assume there's no rebate if West Ham release an event date. Bet that's under the black ink.
Barry Hearn reckons there is space for only 30 more major event days in the stadium. I suspect that might be further restricted by the 7 days it takes to retract the seating (and 7 more to restore it again). Vinci are going to have their work cut out, I think. Athletics only have 3 months to use it, after all.
I read somewhere that athletics use is only third week of June to end of July.
Probably true, but remember links are good, random press releases... ;-)
Yeah, you know what ? You're right, it's all a big conspiracy. No one negotiating on behalf of the LLDC has done any calculations or estimates. West Ham just threw the 100K figure at them and they figured "Yeah, that should cover most of the costs...". It's a real shame that the LLDC wasn't made up of Charlton Athletic fans in the first place. With the money coming in from West Ham to the taxpayer as a result the government could probably open another 25 hospitals in two years time all over the country...
What are your sources for the following two facts in your post?
£100k per additional game over and above the 23-25 in the original deal West Ham paying enough over two years to open 25 hospitals
Remember, links are good, random press releases not so good.
I know the source for the 100k. Sean Whetstone, a West Ham blogger who likes to be seen as ITK. He is the bloke in the BBC doc who tells us that he has talked to Gullivan many times and can guarantee that they won't sell up. Talk about hostage to fortune...
Yeah, you know what ? You're right, it's all a big conspiracy. No one negotiating on behalf of the LLDC has done any calculations or estimates. West Ham just threw the 100K figure at them and they figured "Yeah, that should cover most of the costs...". It's a real shame that the LLDC wasn't made up of Charlton Athletic fans in the first place. With the money coming in from West Ham to the taxpayer as a result the government could probably open another 25 hospitals in two years time all over the country...
What are your sources for the following two facts in your post?
£100k per additional game over and above the 23-25 in the original deal West Ham paying enough over two years to open 25 hospitals
Remember, links are good, random press releases not so good.
I know the source for the 100k. Sean Whetstone, a West Ham blogger who likes to be seen as ITK. He is the bloke in the BBC doc who tells us that he has talked to Gullivan many times and can guarantee that they won't sell up. Talk about hostage to fortune...
The way I see it is, they will retire and pass it on to their families and then they will sell.
Yeah, you know what ? You're right, it's all a big conspiracy. No one negotiating on behalf of the LLDC has done any calculations or estimates. West Ham just threw the 100K figure at them and they figured "Yeah, that should cover most of the costs...". It's a real shame that the LLDC wasn't made up of Charlton Athletic fans in the first place. With the money coming in from West Ham to the taxpayer as a result the government could probably open another 25 hospitals in two years time all over the country...
What are your sources for the following two facts in your post?
£100k per additional game over and above the 23-25 in the original deal West Ham paying enough over two years to open 25 hospitals
Remember, links are good, random press releases not so good.
I know the source for the 100k. Sean Whetstone, a West Ham blogger who likes to be seen as ITK. He is the bloke in the BBC doc who tells us that he has talked to Gullivan many times and can guarantee that they won't sell up. Talk about hostage to fortune...
Yeah, you know what ? You're right, it's all a big conspiracy. No one negotiating on behalf of the LLDC has done any calculations or estimates. West Ham just threw the 100K figure at them and they figured "Yeah, that should cover most of the costs...". It's a real shame that the LLDC wasn't made up of Charlton Athletic fans in the first place. With the money coming in from West Ham to the taxpayer as a result the government could probably open another 25 hospitals in two years time all over the country...
What are your sources for the following two facts in your post?
£100k per additional game over and above the 23-25 in the original deal West Ham paying enough over two years to open 25 hospitals
Remember, links are good, random press releases not so good.
I know the source for the 100k. Sean Whetstone, a West Ham blogger who likes to be seen as ITK. He is the bloke in the BBC doc who tells us that he has talked to Gullivan many times and can guarantee that they won't sell up. Talk about hostage to fortune...
The way I see it is, they will retire and pass it on to their families and then they will sell.
Well depending on the detail of the clawback deal, they could potentially sell all but one share and keep the lot. I'm sure the LLDC wouldn't be that dumb though.
I take quite a bit of info from various West Ham sources, yome turn out to be true, some less so. That 25 game thing is easy enough to manage, 25 games included in the rent, if at the end of the season you have more games than 25 then each game on top is another 100K in the coffers of the LLDC. Of course there may be seasons when no additional games will be needed anyway due to early cup exits, no Europa League (nevermind CL) and maybe just one friendly or preseason game.
You assume there's no rebate if West Ham release an event date. Bet that's under the black ink.
Barry Hearn reckons there is space for only 30 more major event days in the stadium. I suspect that might be further restricted by the 7 days it takes to retract the seating (and 7 more to restore it again). Vinci are going to have their work cut out, I think. Athletics only have 3 months to use it, after all.
I read somewhere that athletics use is only third week of June to end of July.
Probably true, but remember links are good, random press releases... ;-)
Source for the statement that UK Athletics have access from 3rd week in June to end of July. It's one of the very last paragraphs in this document.
Obviously if the anchor tenant is in European competition in July, well.......
Why do you assume that most events would need the stadium to be in athletics mode ? Surely there can and will be events where the stands can remain in football mode, maybe with more seating temporarily installed on the pitch area, for concerts and the like.
I didn't say they did - they will be constrained by the time it takes to get out of football mode and back again. That is, any events that need a non football mode stadium are somewhat screwed for 9 months.
Hex thanks for the correction, of course it's Vinci who will be doing the negotiating.
By the way, you overlooked my question. Could you explain how future negotiations are harmed by publishing (i) the detail of the clawback clause (ii) detail of performance payments (iii) the amount Upton Park was sold for?
Yeah, you know what ? You're right, it's all a big conspiracy. No one negotiating on behalf of the LLDC has done any calculations or estimates. West Ham just threw the 100K figure at them and they figured "Yeah, that should cover most of the costs...". It's a real shame that the LLDC wasn't made up of Charlton Athletic fans in the first place. With the money coming in from West Ham to the taxpayer as a result the government could probably open another 25 hospitals in two years time all over the country...
What are your sources for the following two facts in your post?
£100k per additional game over and above the 23-25 in the original deal West Ham paying enough over two years to open 25 hospitals
Remember, links are good, random press releases not so good.
I know the source for the 100k. Sean Whetstone, a West Ham blogger who likes to be seen as ITK. He is the bloke in the BBC doc who tells us that he has talked to Gullivan many times and can guarantee that they won't sell up. Talk about hostage to fortune...
I didn't say they did - they will be constrained by the time it takes to get out of football mode and back again. That is, any events that need a non football mode stadium are somewhat screwed for 9 months.
Hex thanks for the correction, of course it's Vinci who will be doing the negotiating.
By the way, you overlooked my question. Could you explain how future negotiations are harmed by publishing (i) the detail of the clawback clause (ii) detail of performance payments (iii) the amount Upton Park was sold for?
Given that the football season ends early May and athletics cannot use it until third week of June can we assume that the grassed area is not usable or covered (eg for concerts) due to renovation work ala the Valley pitch this summer ?
Yeah, you know what ? You're right, it's all a big conspiracy. No one negotiating on behalf of the LLDC has done any calculations or estimates. West Ham just threw the 100K figure at them and they figured "Yeah, that should cover most of the costs...". It's a real shame that the LLDC wasn't made up of Charlton Athletic fans in the first place. With the money coming in from West Ham to the taxpayer as a result the government could probably open another 25 hospitals in two years time all over the country...
What are your sources for the following two facts in your post?
£100k per additional game over and above the 23-25 in the original deal West Ham paying enough over two years to open 25 hospitals
Remember, links are good, random press releases not so good.
I know the source for the 100k. Sean Whetstone, a West Ham blogger who likes to be seen as ITK. He is the bloke in the BBC doc who tells us that he has talked to Gullivan many times and can guarantee that they won't sell up. Talk about hostage to fortune...
Has Sean Whetstone seen the contract?
I really can't imagine that he has. He must have talked though to people who have. What those people think of him gobbing all over the web, only they know. He posted the BBC doc on You Tube and then strikes up a dialogue with me below. There he shows enough knowledge of detail which we had discovered but is not widely in the public domain (e.g Delaware) that I take seriously the other stuff he says, such as the actual size of the relegate rebate. He comes across as their version of Mr May without the bullying and attempts at intimidation. I would think the club would be furious at him for revealing the size of the relegate rebate. We are happy to use his figure of course, until such time as either WHU and LLDC publicly state its wrong. Which they have not done. Nor have they denied that we nailed the overheads matter. Indeed Whetstone showed that he referred to this (without pricing them) back in 2013. Very odd behaviour. He's working "for " West Ham in the way Tomas Repka used to do :-)
You claimed in your recent news bulletin about this petition going national and this not being about jealousy or infighting between rival sets of football fans. And apparently the participation of so many other clubs would prove just that. I think it only proves that is it about nothing else but not wanting to see a rival club do well. If Charlton Athletic had struck a deal like West Ham and was moving into the OS next year there might well be a similar coalition of petitioners from other clubs, in this case including West Ham. But it would not automatically mean that the Charlton deal is unlawful or unfair, just that they'd have a deal other clubs would like to have to but for one reason or another did not pursue when the bidding process was open. You make it sound as if there is some kind of precedent deal that would tell us how a fair deal should look like. There is none. These are individual cases that need to be treated as such. The government when renting out a public asset must look at local market conditions at the time. I've already pointed out the reasons why this situation wasn't the best for the LLDC negotiators to begin with and West Ham stepped in and took advantage, again like other clubs could have done.
I'll leave you with a quote from David Sullivan from a recent podcast which in my view is not a bad comparison: "We've done a good deal, but i would say to people there's lots of benefits for the LLDC that people don't know about that are in the contract. A huge part of the income that we're giving up is catering, they et virtually all the catering income. No-one has mentioned that and it's huge. It's like if you run a cinema you get very little out of the films as the money is all in the catering. If you've got Harry Potter on that week you're selling so much popcorn and so-and-so it's profitable for the cinema operator. That's exactly what will happen at the Olmpic Stadium. So it's a terrific deal for the legacy, for the stadium, for the community and the jobs that will be created and for West Ham. It's a great deal for everyone, a win-win situation." Read more at http://www.kumb.com/story.php?id=128932#8A1tGl2ZISImQIom.99
You claimed in your recent news bulletin about this petition going national and this not being about jealousy or infighting between rival sets of football fans. And apparently the participation of so many other clubs would prove just that. I think it only proves that is it about nothing else but not wanting to see a rival club do well. If Charlton Athletic had struck a deal like West Ham and was moving into the OS next year there might well be a similar coalition of petitioners from other clubs, in this case including West Ham. But it would not automatically mean that the Charlton deal is unlawful or unfair, just that they'd have a deal other clubs would like to have to but for one reason or another did not pursue when the bidding process was open. You make it sound as if there is some kind of precedent deal that would tell us how a fair deal should look like. There is none. These are individual cases that need to be treated as such. The government when renting out a public asset must look at local market conditions at the time. I've already pointed out the reasons why this situation wasn't the best for the LLDC negotiators to begin with and West Ham stepped in and took advantage, again like other clubs could have done.
I'll leave you with a quote from David Sullivan from a recent podcast which in my view is not a bad comparison: "We've done a good deal, but i would say to people there's lots of benefits for the LLDC that people don't know about that are in the contract. A huge part of the income that we're giving up is catering, they et virtually all the catering income. No-one has mentioned that and it's huge. It's like if you run a cinema you get very little out of the films as the money is all in the catering. If you've got Harry Potter on that week you're selling so much popcorn and so-and-so it's profitable for the cinema operator. That's exactly what will happen at the Olmpic Stadium. So it's a terrific deal for the legacy, for the stadium, for the community and the jobs that will be created and for West Ham. It's a great deal for everyone, a win-win situation." Read more at http://www.kumb.com/story.php?id=128932#8A1tGl2ZISImQIom.99
Talk to Airman Brown about how much is made from non-hospitality catering, I seem to recall it's somewhere in the region of £1 per seat sold, so if West Ham sold 50000 non-hospitality seats at everyone of their 25 games (unlikely, especially for league cup, pre-season, etc.), it's little more than £1million a year, hardly the fortunes hinted at by Sullivan. And, of course, if West Ham were to get relegated that income would drop by at least 50%.
Yes, Ajax and Man City. Again though, a market and prices develop, depending on time, location, number of market participants etc. What may have been a good deal for all sides in Amsterdam or Manchestermight not work in London. That's what I meant telling you about market conditions. The OS was a special situation where many stupid mistakes brought us to a messy situation which vastly reduced the number of suitors. Could or should the deal have been similar to Manchester or Amsterdam ? Maybe. But it is not because this is a different scenario, resulting in different negotiations and different terms. Look at the catering alone. I know most fans do their serious boozing in pubs outside the stadiums anyway, but there are still food and drink stalls inside most stadiums that are being used so there is a market for it. Let's just assume that every second fan buys food and drink for five quid (very conservative estimate). That is 125K for 19 home games = 2.375 million per season on top of the rent and we haven't even mentioned naming rights income at that point.
Yeah, you know what ? You're right, it's all a big conspiracy. No one negotiating on behalf of the LLDC has done any calculations or estimates. West Ham just threw the 100K figure at them and they figured "Yeah, that should cover most of the costs...". It's a real shame that the LLDC wasn't made up of Charlton Athletic fans in the first place. With the money coming in from West Ham to the taxpayer as a result the government could probably open another 25 hospitals in two years time all over the country...
What are your sources for the following two facts in your post?
£100k per additional game over and above the 23-25 in the original deal West Ham paying enough over two years to open 25 hospitals
Remember, links are good, random press releases not so good.
I know the source for the 100k. Sean Whetstone, a West Ham blogger who likes to be seen as ITK. He is the bloke in the BBC doc who tells us that he has talked to Gullivan many times and can guarantee that they won't sell up. Talk about hostage to fortune...
Has Sean Whetstone seen the contract?
I really can't imagine that he has. He must have talked though to people who have. What those people think of him gobbing all over the web, only they know. He posted the BBC doc on You Tube and then strikes up a dialogue with me below. There he shows enough knowledge of detail which we had discovered but is not widely in the public domain (e.g Delaware) that I take seriously the other stuff he says, such as the actual size of the relegate rebate. He comes across as their version of Mr May without the bullying and attempts at intimidation. I would think the club would be furious at him for revealing the size of the relegate rebate. We are happy to use his figure of course, until such time as either WHU and LLDC publicly state its wrong. Which they have not done. Nor have they denied that we nailed the overheads matter. Indeed Whetstone showed that he referred to this (without pricing them) back in 2013. Very odd behaviour. He's working "for " West Ham in the way Tomas Repka used to do :-)
I imagine that the opposite is true - knowing he can't help himself no doubt they feed him stuff like £100k per extra game.
You claimed in your recent news bulletin about this petition going national and this not being about jealousy or infighting between rival sets of football fans. And apparently the participation of so many other clubs would prove just that. I think it only proves that is it about nothing else but not wanting to see a rival club do well. If Charlton Athletic had struck a deal like West Ham and was moving into the OS next year there might well be a similar coalition of petitioners from other clubs, in this case including West Ham. But it would not automatically mean that the Charlton deal is unlawful or unfair, just that they'd have a deal other clubs would like to have to but for one reason or another did not pursue when the bidding process was open. You make it sound as if there is some kind of precedent deal that would tell us how a fair deal should look like. There is none. These are individual cases that need to be treated as such. The government when renting out a public asset must look at local market conditions at the time. I've already pointed out the reasons why this situation wasn't the best for the LLDC negotiators to begin with and West Ham stepped in and took advantage, again like other clubs could have done.
I'll leave you with a quote from David Sullivan from a recent podcast which in my view is not a bad comparison: "We've done a good deal, but i would say to people there's lots of benefits for the LLDC that people don't know about that are in the contract. A huge part of the income that we're giving up is catering, they et virtually all the catering income. No-one has mentioned that and it's huge. It's like if you run a cinema you get very little out of the films as the money is all in the catering. If you've got Harry Potter on that week you're selling so much popcorn and so-and-so it's profitable for the cinema operator. That's exactly what will happen at the Olmpic Stadium. So it's a terrific deal for the legacy, for the stadium, for the community and the jobs that will be created and for West Ham. It's a great deal for everyone, a win-win situation." Read more at http://www.kumb.com/story.php?id=128932#8A1tGl2ZISImQIom.99
I may be mistaken, but I had thought that catering income was shared between West Ham and Vinci, with LLDC getting a share of Vinci's profits. We have no idea how much West Ham are earning because it's been redacted. A good deal for LLDC it might be, but then why does Sullivan get an automatic credibility bye here?
And if it's Vinci getting a share of the income, they will have to cover all their costs with that share and no doubt make agreed margin before LLDC and the taxpayer even think of getting a penny.
Football is not, incidentally, like a cinema and the comparison is entirely invalid. Since when did you pay £50 to get into the cinema? 40% of a cinema's revenues is catering. Everton's entire catering and commercial income during 2013 was £4m, just 3% of their turnover. Even if West Ham do spectacularly better, their catering income would have to be £45m last year to be comparable. Or if you like around £60 per seat per game. Now we have expensive pies down at the Valley, but...
Did you even give it a second thought before you lapped Sullivan's rhetoric up?
Yes, Ajax and Man City. Again though, a market and prices develop, depending on time, location, number of market participants etc. What may have been a good deal for all sides in Amsterdam or Manchestermight not work in London. That's what I meant telling you about market conditions. The OS was a special situation where many stupid mistakes brought us to a messy situation which vastly reduced the number of suitors. Could or should the deal have been similar to Manchester or Amsterdam ? Maybe. But it is not because this is a different scenario, resulting in different negotiations and different terms. Look at the catering alone. I know most fans do their serious boozing in pubs outside the stadiums anyway, but there are still food and drink stalls inside most stadiums that are being used so there is a market for it. Let's just assume that every second fan buys food and drink for five quid (very conservative estimate). That is 125K for 19 home games = 2.375 million per season on top of the rent and we haven't even mentioned naming rights income at that point.
It's not the amount spent by each fan, it's the amount of profit on each purchase. Sell a sausage roll for £2.50, and once you've taken out your wholesale costs, staffing, energy (heating/keeping hot), napkin, electricity to run the tills and keep the lights on then you're left with a profit probably around the £1 mark. So in your example, every other fans buys £5 worth of stuff, then there's going to be £2 (at the very most, I imagine retail catering doesn't have a 30%+ profit margin), and you get back to my original figures.
Comments
It's a real shame that the LLDC wasn't made up of Charlton Athletic fans in the first place.
With the money coming in from West Ham to the taxpayer as a result the government could probably open another 25 hospitals in two years time all over the country...
West Ham would have to have been asked to pay an awful lot more before it made more commercial sense to stay at Upton Park. That the LLDC didn't get that is damning. That they aren't up to negotiating big contracts should be as big a concern for the taxpayer, and such naivete is also behind their anticipated inability to be able to negotiate with anyone else if they release the details about this one. Either they believe in their product or they don't.
This isn't really about West Ham per se, more 'Naming Rights United'. That is, it's about the deal - because anyone would have received an unfair, state-sponsored advantage.
£100k per additional game over and above the 23-25 in the original deal
West Ham paying enough over two years to open 25 hospitals
Remember, links are good, random press releases not so good.
Barry Hearn reckons there is space for only 30 more major event days in the stadium. I suspect that might be further restricted by the 7 days it takes to retract the seating (and 7 more to restore it again). Vinci are going to have their work cut out, I think. Athletics only have 3 months to use it, after all.
By the way - 12,000 sq ft seems to be included in that rent as well, so £100k might be wishful thinking. Plus I think there's every chance that the business case starts to lose money after match 25.
Obviously if the anchor tenant is in European competition in July, well.......
Hex thanks for the correction, of course it's Vinci who will be doing the negotiating.
By the way, you overlooked my question. Could you explain how future negotiations are harmed by publishing (i) the detail of the clawback clause (ii) detail of performance payments (iii) the amount Upton Park was sold for?
If Charlton Athletic had struck a deal like West Ham and was moving into the OS next year there might well be a similar coalition of petitioners from other clubs, in this case including West Ham.
But it would not automatically mean that the Charlton deal is unlawful or unfair, just that they'd have a deal other clubs would like to have to but for one reason or another did not pursue when the bidding process was open.
You make it sound as if there is some kind of precedent deal that would tell us how a fair deal should look like.
There is none. These are individual cases that need to be treated as such.
The government when renting out a public asset must look at local market conditions at the time. I've already pointed out the reasons why this situation wasn't the best for the LLDC negotiators to begin with and West Ham stepped in and took advantage, again like other clubs could have done.
I'll leave you with a quote from David Sullivan from a recent podcast which in my view is not a bad comparison:
"We've done a good deal, but i would say to people there's lots of benefits for the LLDC that people don't know about that are in the contract. A huge part of the income that we're giving up is catering, they et virtually all the catering income. No-one has mentioned that and it's huge.
It's like if you run a cinema you get very little out of the films as the money is all in the catering. If you've got Harry Potter on that week you're selling so much popcorn and so-and-so it's profitable for the cinema operator.
That's exactly what will happen at the Olmpic Stadium. So it's a terrific deal for the legacy, for the stadium, for the community and the jobs that will be created and for West Ham. It's a great deal for everyone, a win-win situation."
Read more at http://www.kumb.com/story.php?id=128932#8A1tGl2ZISImQIom.99
What may have been a good deal for all sides in Amsterdam or Manchestermight not work in London.
That's what I meant telling you about market conditions. The OS was a special situation where many stupid mistakes brought us to a messy situation which vastly reduced the number of suitors.
Could or should the deal have been similar to Manchester or Amsterdam ? Maybe.
But it is not because this is a different scenario, resulting in different negotiations and different terms.
Look at the catering alone. I know most fans do their serious boozing in pubs outside the stadiums anyway, but there are still food and drink stalls inside most stadiums that are being used so there is a market for it.
Let's just assume that every second fan buys food and drink for five quid (very conservative estimate).
That is 125K for 19 home games = 2.375 million per season on top of the rent and we haven't even mentioned naming rights income at that point.
And if it's Vinci getting a share of the income, they will have to cover all their costs with that share and no doubt make agreed margin before LLDC and the taxpayer even think of getting a penny.
Football is not, incidentally, like a cinema and the comparison is entirely invalid. Since when did you pay £50 to get into the cinema? 40% of a cinema's revenues is catering. Everton's entire catering and commercial income during 2013 was £4m, just 3% of their turnover. Even if West Ham do spectacularly better, their catering income would have to be £45m last year to be comparable. Or if you like around £60 per seat per game. Now we have expensive pies down at the Valley, but...
Did you even give it a second thought before you lapped Sullivan's rhetoric up?