Has bubble burst over West Ham’s London Stadium deal of the century?

December 4 – West Ham’s tenancy at the London Stadium has been controversial from the start. Accusations that the stadium was a government giveaway to the Premier League club seem to have now been backed up London Mayor Sadiq Khan’s announcement that he is stepping in to take over the running of the stadium that is costing the taxpayer £20 million a year.

A report by accountants Moore Stephens found the £323 million cost of the conversion of the Olympic Stadium into a football venue would never be recovered. The report finds that the stadium itself would continue to lose £10m-£20 million a year, with West Ham paying just £2.5 million a year on a 99-year lease, having made a contribution to the conversion of just £15 million.

The total cost to the taxpayer of the London Stadium build is now reckoned to be at £752 million.

Khan, when announcing the decision to take control of the stadium, said the findings were “simply staggering” and were the result “a bungled decision-making process that has the previous Mayor’s (Boris Johnson) fingerprints all over it.”

This is not the first time that Johnson has faced criticism over the lease-deal with West Ham, with former Leyton Orient owner Barry Hearn, whose club were the nearest to the stadium but were excluded from any tenancy, saying that the stadium was the giveaway of what should be a national asset. He said any buyer of West Ham, a privately owned club, would effectively be getting the 60,000-seat stadium for free.

Johnson supporters argue that the West Ham deal was the only one on the table and that it is part of a vibrant Olympic legacy that no other Olympic host city has been able to demonstrate. But with Spurs now spending £1 billion of their own money to build a new stadium, the West Ham deal looks increasingly cheap, and will do for another 98 years.

A West Ham United statement said: “As the report confirms, the Concession Agreement is a watertight, legally binding contract signed in 2013 in good faith by West Ham United, who remain absolutely committed to its terms for the entire 99-year duration.

“It is not in West Ham United’s interests for the Stadium to not be performing in line with aspiration and, as we have done ever since moving to Stratford in the summer of 2016, we continue to offer the benefit of our commercial expertise and substantial experience in managing successful stadia.

“West Ham United will continue to devote our absolute commitment to London Stadium, but our first priority in this sense is always to act in the best interests of our supporters.”

“We fully concur that West Ham United has played a significant part in the most successful regeneration programme in the history of the modern Olympics, however the stadium itself craves renewed leadership and direction and we welcome the Mayor’s decision to step in and deliver this. West Ham United is firmly behind him.”

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