Manchester United have been warned by a football finance expert that their new 100,000-seater stadium could cost in excess of £2billion, with the club’s finances also coming under scrutiny
Football finance expert Stefan Borson has warned Manchester United that their proposed 100,000-seater stadium could set them back well in excess of £2billion, warning that now is ‘not the right environment’ for such an ambitious project.
Soaring interest rates mean the landmark move away from Old Trafford will come at a considerable cost. CityAM has also reported growing doubts over the finances, with the club allegedly approaching the government for assistance in funding the infrastructure surrounding the stadium, while being left to source private funding for the ground development itself.
United secured their return to European football’s top table after finishing third in the Premier League last season. Champions League qualification has bolstered their finances by nearly £100million, though much of that investment is likely to be swallowed up by wage increases following their top-four finish, as well as transfer expenditure this summer, with Michael Carrick’s squad widely expected to be active in the market.
Get the latest World Cup news straight to your inbox by signing up to our Make Football Great Again newsletter now!
It has been suggested that United are exploring a range of funding options for the stadium project, whether through private investment or ownership contributions, having already engaged with “several” potential investors.
However, it remains to be seen whether the Glazer family or minority owner Sir Jim Ratcliffe plan to foot the bill themselves, with the club having recently restructured £410million of their debts — which exceed £1billion in total — at interest rates of 5.36 percent.
“Of course, if the owners stick £2bn in and build the stadium themselves, then there’s no issue. But that’s not what’s been touted at the moment,” Borson told City AM.
“The environment is not right to build a stadium. We have very high interest rates that don’t look like coming down and it doesn’t look like the owners will underwrite it.
“Man United, even with a 100,000-seater stadium, a football club able to deal with £3.5bn-£4bn of total debt? I say no it can’t.”
FOLLOW OUR MAN UTD FB PAGE! Latest United news and more on our dedicated Facebook page
He added: “Their starting point is a heavy existing debt profile.
“You have the senior debt, the secured loan and you have the revolving credit facility – effectively the overdraft – and a substantial amount owed to other clubs for historic transfers.
“Presumably because United have made the senior facility a little bigger at $550m (£415m), they won’t need to rely on the overdraft quite as much. But they’re still in an investment phase in the first team, so you would think they’re going to need cash for that.
“The top and bottom of it is: the existing debt isn’t coming down anytime soon. They’re not going to be in a position where they’re throwing off loads of excess cash to start repaying debt.”
This week marked a significant milestone in United’s ambitions to build a Wembley Stadium-style venue, with formal plans unveiled. The move would place the club alongside rivals Manchester City, Everton, and Liverpool in boasting a multi-purpose venue capable of generating additional income from music concerts, amongst other events.
Former Greater Manchester mayor Andy Burnham recently vacated his position after securing victory in the local election to become the member of parliament for the Makerfield constituency. Burnham, who was a strong supporter of the proposals and heavily linked to them, is considered one of the frontrunners to succeed Keir Starmer as Prime Minister, though his change of role would have no bearing on the plans.
Earlier this year, Burnham firmly ruled out using public money to fund the stadium’s construction. A United spokesperson said: “Our proposed new stadium will be financed privately, and we continue to have positive conversations with potential investors and all stakeholders.”
Thousands of fans upgraded their Premier League matchday last season. This is how they did it.
Official premium experiences available now for the 26/27 Premier League season. Make it easier than ever to turn a regular fixture into something genuinely unforgettable.
You must be logged in to post a comment Login