This past week saw Chelsea co-owner Todd Boehly speak on the potential of the club to build a new stadium in the coming years, and how it might be something that either unites or divides the ownership group.
Having acquired Chelsea back in May 2022, Boehly and co-owners Clearlake Capital have aggressively pursued a transfer strategy that has seen them spend more than £1billion and rake in hundreds of millions from the sale of homegrown assets such as Conor Gallagher and Mason Mount.
It has been a controversial play, with Chelsea even selling hotels to related parties to create paper profits that have allowed them to fly under the radar when it comes to the Premier League’s profit and sustainability rules (PSR).
Competitive success has eluded them and a lack of Champions League participation for this long was not part of the plan. The thesis remains, however, that this is a team that has been built to deliver success into the future given its age and talent profile, but the owners know that in order to keep revenues climbing and to make the £2.5billion investment pay off upon exit in years to come, they are going to have to invest in the bricks and mortar to a considerable degree.
Speaking to Bloomberg earlier this week, Boehly was quizzed on the state of play when it came to either Stamford Bridge redevelopment or the prospect of moving to a new purpose-built stadium in the coming years, a project that would provide a great deal of capital to complete, not to mention both the financial and logistical challenges of delivering such a major project in one of London’s most expensive areas, where space is at a premium.
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“We have to think about long term, what we are trying to accomplish,” said Boehly.
“We have a big stadium-development opportunity that we have to flesh out. And I think that is going to be where we are either aligned or we ultimately decided to go different ways.
“Inside of London, it is really complex. It’s not as though we’re building something in the middle of a rural environment.
“Long term, I think we are going to be building something new and we will figure it out.”
With clubs seeking to reduce their reliance on broadcast rights values, which face some challenging times of their own in years to come and a potential diminution how much they will be worth domestically, many top clubs have pursued stadium redevelopment strategies or the building of completely new venues to allow them to maximise revenue streams.
Manchester United recently unveiled plans for a 100,000-seater stadium at an estimated build cost of £2billion, while Everton move into a new 52,888-seater £750million stadium at the start of next season. Tottenham Hotspur moved into their new home in 2019, a game changer for club revenues, while Liverpool redeveloped Anfield considerably over the course of the last decade. Arsenal and Manchester City are pursuing redevelopment of their own, while Newcastle United are planning a new stadium build, according to reports.
When it comes to matchday revenue, Chelsea’s sat at £80million for 2023/24. That puts them fifth out of the so-called big six. In terms of growth over the last five years, the Blues’ 20% increase over that period is the smallest out of that big six. Without a workable plan for the future, that gap will only get bigger, and that makes it harder to put to work money on the pitch.
The challenges with redevelopment of Stamford Bridge are many, and while Boehly didn’t offer any confirmation on what would happen with regard to what would be a key moment in Chelsea’s history, determining what happens in the future, he offered up some clues.
Boehly knows all about the American sports eco-system. He’s a co-owner of the Los Angeles Dodgers baseball team and also a minority stakeholder in both the LA Lakers NBA franchise, and the LA Sparks WNBA team.
American major league teams have been ahead of the curve in comparison to European football teams when it comes to stadiums, with most arenas multi-purpose and having multiple revenue streams.
On Tuesday evening it was first reported by US sports business website Sportico that the NBA would this week vote on proposals to launch an NBA European league, with the split being 50% between the NBA and 50% between the chosen franchises across the continent. London will almost certainly be a major consideration for European NBA franchise, and Boehly senses opportunity.
“Stadium development is definitely a theme,” Boehly told Bloomberg.
“You’re going to see the NBA go to Europe, they need stadiums, they need arenas. We’re just on the very front end of the sporting wave and sporting infrastructure is going to be a big thing about it.”
With that in mind, the potential for a multi-sport arena as part of a new stadium development for the club would provide them with the opportunity to supercharge revenue streams in much the same way that Spurs have done across London with their stadium having been built to host NFL regular season games, something that delivers tens of millions in additional income for the club year on year, with the NFL inking a decade-long deal with the club for usage of their arena.
With the potential for a major NBA European franchise to pitch up in London, and looking for a home of its own, Chelsea could find they have the chance to offer a solution, as well as the possibility of getting access to different lines of capital for such a project to sit alongside a stadium build.
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Cole Palmer of Chelsea celebrates scoring his team's second goal from the penalty spot with team mate Jadon Sancho during the Premier League match between Chelsea FC and Brighton & Hove Albion FC at Stamford Bridge on September 28, 2024
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