Report: Spurs stadium naming valuation overpriced

30 May 2019

spurs
Photo: Getty Images Tottenham Hotspur might have overpriced the naming rights valuation of their new stadium, according to latest research.

Tottenham unlikely to negotiate stadium naming rights at current valuation.

Independent report reveals market value of a deal.

Tottenham Hotspur might have overpriced the naming rights valuation of their new stadium, according to latest research.

It is understood Spurs chairman Daniel Levy has placed a £200 million valuation on a naming rights deal for a ten-year rights deal - the equivalent of £20 million a year.

An independent report by Duff & Phelps has calculated the value of naming rights for the new Spurs stadium at £17.5 million a year - the third highest valuation in the Premier League.

The £2.5 million a year mis-match in valuations, explains why the club has so far failed to secure a naming rights partner.

Decreasing value of naming rights

Offthepitch.com understands talks are continuing with several parties, while reports have emerged HSBC walked away from a deal over the club’s valuation.

Many football-marketing experts believe the value of stadium naming rights has decreased in recent years because companies can compare it with other marketing options, including social media.

 

It is unlikely a brand would consider changing the name of the historic Anfield Stadium or Old Trafford, after observing the backlash from Newcastle fans when St James’ Park was changed to the Sports Direct Arena.

The report by the US-based consultancy placed Manchester United’s Old Trafford stadium as the most valuable naming rights proposition, with a value of £26.75 million per season.

Manchester City’s Etihad Stadium was second at £21.9 million. Liverpool’s naming rights estimate has risen to £16.9 million, assisted by their appearance in the Champions League final last season and strong league performance this season.

Backlash from Newcastle fans

It is unlikely a brand would consider changing the name of the historic Anfield Stadium or Old Trafford, after observing the backlash from Newcastle fans when St James’ Park was changed to the Sports Direct Arena. 

Tottenham Hotspur’s Champions League performances this season have provided a further premium to be paid by a brand wanting to have their name on arguably the best stadium in Europe. 

There is also less risk of fan backlash and negative publicity as any potential deal would not involve changing the name of a historic stadium that is sentimental to fans.

The club will have the most expensive season tickets in the Premier League in 2019/20, with adult prices ranging from £795 to £2,200.

The final cost of Tottenham’s stadium project could exceed £1.2 billion.

Construction experts estimated the final bill for the project - including stadium, delay-related costs, land acquisition and related developments will exceed £1 billion.

Most expensive season tickets

Spurs are exceeding expectations on and off the pitch. The club reached the Champions League final this season and posted a word-record profit of £113 million in 2017/18.

Matchday receipts for the same season increased from £45.3 million to £71 million after the move to Wembley and Spurs will likely see a further increase from the new stadium.

The club will have the most expensive season tickets in the Premier League in 2019/20, with adult prices ranging from £795 to £2,200.

Matchday income will be boosted through catering - estimated at £800,000-£1 million per game.

Additional revenues from a stadium naming rights deal would afford the club additional financial strength to pay down construction costs.

A source said: “The club possess the most impressive stadium in the Premier League, but the financial pressures of the construction are only just beginning. A naming rights deal would greatly help.”