New Stadium

[Gal]

Lack of plans has never been the issue anywhere on this planet, the problem is the monstrous bureaucracy found in some part of our world and Italy are particular bad. The bureaucracy means it’s like scaling Everest every single time you want to do something, don’t matter if it’s building a garage or a stadium, heck even starting up a company is a challenge of a lifetime.

I’ll likely be dead by the time a new stadium get approved, I probably been in the ground for 100 years before the first ticket is sold if they keep the current pace.

 

[DARi0]

Alessandro Antonello admits both the Nerazzurri and Milan are ‘disappointed’

Inter and Milan unveiled in December 2021 a plan to build a new stadium in the San Siro area. It was supposed to be called ‘The Cathedral’ and be ready in 2027 after the demolition of the old Stadio Meazza.

However, Italian bureaucracy and a lengthy public debate involving citizens of the San Siro area ultimately made the plan collapse, so Inter have identified Rozzano, on the outskirts of Milan, as the venue for their next arena while Milan could move to San Donato.

Enough waiting

“It’s been a long debate given that Milan and we have been waiting for five years, so there’s a bit of disappointment because we still don’t see the final result,” Antonello said during an event in Milan on Tuesday, as quoted by FcInter1908.

“We are organised with alternative plans which we are carrying forward.”

Milano’s Mayor Beppe Sala has recently offered Inter and Milan the chance to buy the Stadio Meazza and pay for its refurbishment for an investment of circa €300m shared between the two clubs.

However, Inter and Milan still seem unconvinced and could ultimately decide to leave the iconic stadium to build their new arenas elsewhere in the near future.

 

[PHM1605]

This thread is crazy almost twenty years old and...still waiting for permission. Not even a single column has been established.

Explains why Italian football has fallen so much behind others. Especially financial.

 

[crzdcolombian]

where are we coming up with the money for a stadium if the city doesnt pay for it?

We owe what 500m at 12% to a hedge fund? Looking for another loan to pay that off as its due and rate will be even higher.

How much is a stadium? even if its 500m which is crazy cheap for 1 in Europe. so 1 billion at 12%+ interest rate

Math says stop dreaming of this.

just for you guys who are bad at math 500m at 5 years at 12% is 167.3m in interest
1b at 12% for 5 years loan is 335m in interest

if we go to 15% interest because we are fkd its 214m and 427.4m in interest for 5 years. Thats being generous we are fkd financially and lenders aren't going to just loan us money at low rates

 

[CafeCordoba]

We don't owe 500m to hedge fund. We owe 400m to creditors but due date of that loan is 2027 and the rate is 6.75%.

Don't mix up Oaktree loan to Inter's loan.

Stadium needs financing too yes, but I think it's easier to get funding for that compared to just football club operation.

 

[IL Fenomeno]

We don't owe 500m to hedge fund. We owe 400m to creditors but due date of that loan is 2027 and the rate is 6.75%.

Don't mix up Oaktree loan to Inter's loan.

Stadium needs financing too yes, but I think it's easier to get funding for that compared to just football club operation.

6.25? I thought 12

 

[CafeCordoba]

6.25? I thought 12

Precisely.

Because you are thinking about the Oaktree loan. Which is not Inter's loan. It's Zhang's holding company's loan.

Inter have a 400m loan, taken in 2017 or something, refinanced in early 2022 and is due in 2027.

 

[IL Fenomeno]

Precisely.

Because you are thinking about the Oaktree loan. Which is not Inter's loan. It's Zhang's holding company's loan.

Inter have a 400m loan, taken in 2017 or something, refinanced in early 2022 and is due in 2027.

Do you mean the bond?

 

[CafeCordoba]

Do you mean the bond?

Yes

 

[Forzanerazzurri]

where are we coming up with the money for a stadium if the city doesnt pay for it?

We owe what 500m at 12% to a hedge fund? Looking for another loan to pay that off as its due and rate will be even higher.

How much is a stadium? even if its 500m which is crazy cheap for 1 in Europe. so 1 billion at 12%+ interest rate

Math says stop dreaming of this.

just for you guys who are bad at math 500m at 5 years at 12% is 167.3m in interest
1b at 12% for 5 years loan is 335m in interest

if we go to 15% interest because we are fkd its 214m and 427.4m in interest for 5 years. Thats being generous we are fkd financially and lenders aren't going to just loan us money at low rates

Oh here come the project finance experts...

 

[DARi0]

Part of the plans for Suning with Inter is building a new stadium in Rozzano, although the local council continues to push the idea of reconstructing the Stadio Giuseppe Meazza.

Latest statement:

“A modern infrastructure is essential and the city of Milan deserves a modern stadium. We are working on various fronts, the one we have the most control over is Rozzano. We’re waiting to see what WeBuild say about San Siro, but we need an arena at the vanguard that guarantees revenue we can then reinvest in the squad.

“Regardless of the future of the club, we will continue to work on a new stadium,” added Antonello.

Seems like the local council managed to set Inter back again

 

[Stefan]

We extended the right to investigate rozzano to Jan 2025.

Stadio Rozzano, diritto esclusiva su terreni prolungato: le date

Il primo accordo con i proprietari dei terreni scadeva oggi ed è arrivato il rinnovo come da comunicato della Bastogi S.p.A

www.fcinter1908.it

 

[CafeCordoba]

Milan hasn't kickstarted their project either so it seems both clubs are STILL waiting for the city of Milano to try to come up with something. I don't know if these sandonatos and rozzanos are really just some backup plans and almost like bluffs to get the best deal possible from the city.

If they weren't, why not just go ahead with the own stadium plans? It feels they are thinking are these own stadiums really feasible financially when there will end up being two of them in the area. How much that other team's stadium decreases your own projected revenues? It's a big investment after all, the payback period is very long. I'm not sure how the math would go. But would there be any sizeable effect to our revenues? We would get extra revenues but how much that is mitigated by the financing costs (to pay the debt from the construction project)?

 

[.h.]

I thought Milan already bought the land? Might be wrong

 

[.h.]

in terms of the balance sheet, its a bit 50/50

on the one hand, you add a stadium and a loan to our balance sheet, so its close to a zero sum game, esp with interest

but at the same time, you increase the club's earning potential.


One of the sister businesses to my business got sold recently. They had a 2m/yr lease left on a building, with 2 years left. So 4m total. The parent company took on the lease, so increased the sister's company EBITDA by 2m, and for that, it increased the valuation 30m.

Fucking mental, but hey. The earning potential was more important than the balance sheet.


You could easily see something like that with Inter, depending on who is the person who'd want to buy us. The 20-40mil earning potential of a new stadia could be worth a lot more than the kinda limited short term balance sheet impact because of the interest accrual.

 

[Forzanerazzurri]

in terms of the balance sheet, its a bit 50/50

on the one hand, you add a stadium and a loan to our balance sheet, so its close to a zero sum game, esp with interest

but at the same time, you increase the club's earning potential.


One of the sister businesses to my business got sold recently. They had a 2m/yr lease left on a building, with 2 years left. So 4m total. The parent company took on the lease, so increased the sister's company EBITDA by 2m, and for that, it increased the valuation 30m.

Fucking mental, but hey. The earning potential was more important than the balance sheet.


You could easily see something like that with Inter, depending on who is the person who'd want to buy us. The 20-40mil earning potential of a new stadia could be worth a lot more than the kinda limited short term balance sheet impact because of the interest accrual.

Sort of. Stadiums are often quite poor investments for sports clubs and for municipalities. Lets say a modern stadium has a 25 year useful life. When you account for the cost, maintenance, debt service, amortization and compare that to the marginal revenue you get from it, its often not worth it. It will take decades to see a positive IRR on a stadium that costs over a billion euro (if at all). This is also obvious given that all of the parties involved seem to be unmotivated, despite what their public statements say. 95% of the discrepancies between Serie A and PL and other large clubs are due to broadcast deals, sponsorships and commercial (only a small part of that which involves non-match day events), not match day revenue. Blowing a Billion Euro on a new stadium isn't going to put a dent into that.

 

[.h.]

Man utd matchday revenue 2023 - 151m
Liverpool 2023 - 103m
Chelsea 2023 - 88m

Inter - 90m, thats with a CL final run and breaking our box records.


Barca? 166m


I think realistically we could put on 20-30m in revenue each year with the stadia alone. Dont forget, the 1 billion euros will include hundreds of millions in, e.g., developing a shopping centre, buying the land, etc. You wouldnt amortise 1 billion over 25 years - and I'd say 25 years is WAY too short a time period. You'd be looking, maybe, 40 years minimum - in which case you need a 2.5% RoI to conceptually break even, which is about the 20-30mil I suggested anyway ignoring all incremental revenues from commercial/etc by opening all the shops and so on.


The other lens to look at it through... There are only so many ways we can increase revenue. Stadia is one that is in our control. I'd agree with you, if I wasnt a particularly rich billionaire, I wouldnt spend 1 bil euros on a stadia for Inter, but if you were a wealthy enough owner, that money is irrelevant - you'd get most of it back on future transaction anyway. 30mil a year is a 60m player + salary on 5 year contract

 

[Forzanerazzurri]

Man utd matchday revenue 2023 - 151m
Liverpool 2023 - 103m
Chelsea 2023 - 88m

Inter - 90m, thats with a CL final run and breaking our box records.


Barca? 166m


I think realistically we could put on 20-30m in revenue each year with the stadia alone. Dont forget, the 1 billion euros will include hundreds of millions in, e.g., developing a shopping centre, buying the land, etc. You wouldnt amortise 1 billion over 25 years - and I'd say 25 years is WAY too short a time period. You'd be looking, maybe, 40 years minimum - in which case you need a 2.5% RoI to conceptually break even, which is about the 20-30mil I suggested anyway ignoring all incremental revenues from commercial/etc by opening all the shops and so on.


The other lens to look at it through... There are only so many ways we can increase revenue. Stadia is one that is in our control. I'd agree with you, if I wasnt a particularly rich billionaire, I wouldnt spend 1 bil euros on a stadia for Inter, but if you were a wealthy enough owner, that money is irrelevant - you'd get most of it back on future transaction anyway. 30mil a year is a 60m player + salary on 5 year contract

Some good points and the numbers are somewhere around that but I just wanted to counter the prevailing idea that this stadium is going to be a pot of gold for the club. Its not exactly that black and white. I was also under the impression that a final stadium cost for something half decent after cost increases and change orders would be around the 1bn euro mark. That does not include any other adjacent infrastructure. Still will be decades to achieve a positive ROI.

 

[.h.]

yeah, the stadium doesnt fix everything, but its the most 'in control' thing for Inter to boost revenues

and, yeah, i guess 1 bil for the stadia could be quite reasonable with the cost of living atm. I suspect that factors in land, but might not factor in the neighbouring construction

the thing is, as an investment goes, its straight onto the balance sheet, frees us of paying rent on the san siro, and also means we can use it for 'other' events throughout the year too

 

[CafeCordoba]

I thought Milan already bought the land? Might be wrong

Yes, but there's still no project started. If they decided already, we would know.