New Everton Stadium

[rochdaleblue]

Really struggling to think what capacity we will need. Let's face it City are struggling to fill their stadium. Even with obstructed seats we still average high 30s attendance wise.
I did my dissertation at uni on ground moves. We will just standing still, with the present team, put 5k on our attendances, just by having the novelty of a new stadium. Sensible pricing and investment in our team, I could foresee us adding another 5k. That would leave us with an average attendance round the 48k mark. Add in the new ticket pricing for away fans and better facilities at a new stadium, more away fans possibly would be enticed to come here. My guess 55k would be perfect and if moshiri delivers us the success we all crave, then allow us flexibility in the design to increase it to 60k.

 

[AndyC]

Really struggling to think what capacity we will need. Let's face it City are struggling to fill their stadium. Even with obstructed seats we still average high 30s attendance wise.
I did my dissertation at uni on ground moves. We will just standing still, with the present team, put 5k on our attendances, just by having the novelty of a new stadium. Sensible pricing and investment in our team, I could foresee us adding another 5k. That would leave us with an average attendance round the 48k mark. Add in the new ticket pricing for away fans and better facilities at a new stadium, more away fans possibly would be enticed to come here. My guess 55k would be perfect and if moshiri delivers us the success we all crave, then allow us flexibility in the design to increase it to 60k.

We're averaging over 35,000 at home this season, irrespective of where and how big a new stadium is, I reckon to take us to averaging closer to 40,000 we need to win a trophy and be top six every year. Success breeds news fans quicker than the birth rate can produce them.

 

[bizzaro]

Any model has to have assumptions built behind it, so I'll explain the assumptions then offer a conclusion.

Assumptions:

Revenue:
Revenue per regular seat rises from current net £20 per seat per game to £25 per seat per game.

Executive seats generate net £200 per seat per game.

Costs:

Build costs: £6,000 per seat
Financing costs: 6% per annum over 25 years.

Capital contribution: £150 million, all other costs met by debt.

Whilst I agree we need to build a stadium appropriate for our future needs, interestingly the capacity of the stadium makes no difference in cashflow terms whether it be 55,000, 60,000 or 65,000.

The key to the financial contribution a new stadium makes is the number of "executive seats" built and sold.

50,000 regular seats and 5,000 executive seat stadium

Additional regular seat revenues: £9.3 m
Additional executive seat revenue: £19 m
Cost of stadium: £330 million
Debt £180 million
Financing costs pa £13.9 m

Net positive cash flow: £14.4 m p.a.

55,000 regular seat and 5,000 executive seat stadium

Additional regular seat revenues: £14.1 m
Additional executive seat revenue: £19 m
Cost of stadium: £390 million
Debt £240 million
Financing costs pa £18.6 m

Net positive cash flow: £14.5 m p.a.

60,000 regular seats and 5,000 executive seat stadium

Additional regular seat revenues: £9.3 m
Additional executive seat revenue: £19 m
Cost of stadium: £330 million
Debt £180 million
Financing costs pa £13.9 m

Net positive cash flow: £14.4 m p.a.

Therefore the size of the stadium is largely a function of the future anticipated demand for seats, and the willingness of Mr Moshiri to debt fund the construction.

The key is the number of executive seats the club can sell and at what price not the total capacity of the ground.

A 50,000 regular seat stadium and 7,000 executive seats makes more commercial sense than a 55,000 regular seat and 5,000 executive seat stadium.

Every 1,000 executive seats sold is worth £3.8 million a year. (At £200 net per seat)

Theres a few big assumptions here.

1. 'Cost of Stadium'.
2. 'Debt' and 'Financing costs'

I also do not understand why 60k regular seats plus 5k exec only generates the same additional revenues as 50k + 5k

That does not look right.


Given Moshiri's contacts in the construction industry and given hugely low steel and commodity prices right now. Today's construction costs are the lowest they are going to be.

 

[ste d' indica]

This is an impressive comeback from Damo. I've not learned much in life, but I do know you don't get out of hospital and go and pick a fight with one of the lads who put you in there. Kudos.

 

[The Esk]

also do not understand why 60k regular seats plus 5k exec only generates the same additional revenues as 50k + 5k

*I copied and pasted the wrong figures in the original post, now amended but it still makes no difference to the bottom line.

Because I have factored in the costs of building extra seats. As you will see from the assumptions, building costs include £6,000 per seat. So adding 5,000 seats adds £30 million to costs.

 

[bizzaro]

*I copied and pasted the wrong figures in the original post, now amended but it still makes no difference to the bottom line.

Because I have factored in the costs of building extra seats. As you will see from the assumptions, building costs include £6,000 per seat. So adding 5,000 seats adds £30 million to costs.

Ok. This is a very very complex topic and you've not had much time to put any figures together.

Will let you refine the figures and repost.

It gets the discussion going at the very least!



You know my views from earlier posts. I think anything less than 60,000 stadium simply is a waste of time for us.

I also answer mistaken posters saying we will not fill a 65,000 stadium with fallacious figures.

The season ticket sales. Non restricted views. Cheaper ticket prices. More hospitality.

Alone will add 20,000 onto a standard Everton gate.

Some really aren't paying attention and talking Everton down.

 

[DrEFC]

*I copied and pasted the wrong figures in the original post, now amended but it still makes no difference to the bottom line.

Because I have factored in the costs of building extra seats. As you will see from the assumptions, building costs include £6,000 per seat. So adding 5,000 seats adds £30 million to costs.

That was obvious Esk, unless people were being smart Alecs. Thanks for breaking it down for us.

 

[DrEFC]

Need to factor in that Liverpool is only a small city ~500k, and the surrounding areas we are competing with very successful teams- harder to attract local-ish fan area, bar London. I think we would struggle massively to attract an extra 20K. You could fill it will young 'uns but you'd have to give the tickets away. Maybe if we did create a young vocal section that might work, and foster the next gen of die-hard fans.

 

[bizzaro]

This:

60,000 regular seats and 5,000 executive seat stadium

Additional regular seat revenues: £9.3 m
Additional executive seat revenue: £19 m
Cost of stadium: £330 million
Debt £180 million
Financing costs pa £13.9 m

Net positive cash flow: £14.4 m p.a.


Should not equal this:

50,000 regular seats and 5,000 executive seat stadium

Additional regular seat revenues: £9.3 m
Additional executive seat revenue: £19 m
Cost of stadium: £330 million
Debt £180 million
Financing costs pa £13.9 m

Net positive cash flow: £14.4 m p.a.


Since 10,000 seats revenues seem to have disappeared.

 

[bizzaro]

Need to factor in that Liverpool is only a small city ~500k, and the surrounding areas we are competing with very successful teams- harder to attract local-ish fan area, bar London. I think we would struggle massively to attract an extra 20K. You could fill it will young 'uns but you'd have to give the tickets away. Maybe if we did create a young vocal section that might work, and foster the next gen of die-hard fans.

This is not correct.

The population of the north west of England is the same as central London with a team per million population of a similar region.

Its also not correct to state we would have to 'give tickets away'

 

[Brennan]

Actual lol at people thinking we'd fill a 65k stadium.

 

[The Esk]

Ok. This is a very very complex topic and you've not had much time to put any figures together.

The model is not difficult, it's just a question of agreeing on the variables namely cost, financing costs, regular seating revenues and executive seating revenues.

Broadly speaking increases in regular seating capacity is slightly cash negative because of the low yield (£25 net) per game, increases in executive seating is cash positive.

 

[bizzaro]

The model is not difficult, it's just a question of agreeing on the variables namely cost, financing costs, regular seating revenues and executive seating revenues.

Broadly speaking increases in regular seating capacity is slightly cash negative because of the low yield (£25 net) per game, increases in executive seating is cash positive.

Not sure I can agree to regular seating being described as 'cash negative'.

As soon as the seat construction cost is paid for (i.e. you presume £6000 which is itself still subjective) that means as soon as that value is exceeded in revenue terms that seat becomes cash positive.

Think we need to distinguish between short term cash positive/negative and long term (i.e. 5+ years) cash positive/negatives.

Or it makes the 'gentrification of the game' inevitable.

 

[The Esk]

Not sure I can agree to regular seating being described as 'cash negative'.

As soon as the seat construction cost is paid for (i.e. you presume £6000 which is itself still subjective) that means as soon as that value is exceeded in revenue terms that seat becomes cash positive.

Think we need to distinguish between short term cash positive/negative and long term (i.e. 5+ years) cash positive/negatives.

Or it makes the 'gentrification of the game' inevitable.

It's cash negative because I have factored in the costs of funding the seat construction over 25 years. Based on reasonable funding assumptions a regular seat by itself does not generate sufficient cash at today's prices.

I can easily add an inflation factor which would make it cash generative but then we have to look at load factors diminishing as prices increase.

 

[Fresh Prince of Belle Val]

Need to factor in that Liverpool is only a small city ~500k, and the surrounding areas we are competing with very successful teams- harder to attract local-ish fan area, bar London. I think we would struggle massively to attract an extra 20K. You could fill it will young 'uns but you'd have to give the tickets away. Maybe if we did create a young vocal section that might work, and foster the next gen of die-hard fans.

If you make the tickets cheap enough you could fill any capacity.