There is no pending land deal... (27 Viewers)

[skybluetony176]

Most matchday parking goes to ACL, the biggest revenue earner was naming rights, they paid to rent the shop and had to pay extra every time they used the pitch to train on.

Was the shop and office's part of the stadium rent or was it separate again?

 

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[Mary_Mungo_Midge]

No zero value depends on the lease length. Read any article on lease valuations and observe the principal that the longer the lease the reduced value of the land and property.

Then read articles on lease valuations that exceed a property life span and observe the view that the leaseholder is then effectively the freeholder.

Your continued clutching at straws that this is a good deal and hiding behind commercial confidentiality isfooling no one. Articles in the local media have made some obvious indications as to the structure of the loan and the lease . It's fairly obvious the whole deal was weighted heavily in wasps favour and to then suggest the council have a big annual lease bonus is folly based on nothing. If there was such a bonus the CET would have had wind of it .

Your "I don't know" stance then applies to everything doesn't it? I guess we are building a new ground after all - I mean the club says so and we don't know otherwise do we?

We've discussed this before, although you're seemingly now ignoring the better insight you were previously given. The value of any lease will diminish over time if revenues are static. But if revenue is increasing, then the value of a lease - especially a long one - can easily go up as the revenues have increased. You know this. Lets not pretend you don't

 

[chiefdave]

I've seen this 'no revenue' comment a couple of times now, but of course the biggest stadium related income is from tickets and we got all that, we got pitchside advertising, car parking, a shop to sell stuff, and I believe we also got income from selling meals in whatever the VIP bits are called.

We got a limited number of parking spaces as part of the lease, I'm not certain they were all for resale as there would be spaces required for players, execs, sponsors etc. As for catering we had to purchase that from ACL but were then free to charge whatever we liked, that's a lot less margin than the club getting it at cost.

Of course if you're correct and those revenues are insignificant Wasps will have no problem giving CCFC all the revenues it generates including things such as naming rights.

 

[italiahorse]

Was the shop and office's part of the stadium rent or was it separate again?

He won't back up his statements because they are really his opinions put over as fact.

 

[chiefdave]

Was the shop and office's part of the stadium rent or was it separate again?

I would imagine it was included. Wasn't that the root of the problem when they were overcharged rates? But how much is the rent at the current shop, I'd guess next to nothing if they could't get any other tenant. And the offices are now at Ryton aren't they so not really costing anything.

 

[Rusty Trombone]

We got a limited number of parking spaces as part of the lease, I'm not certain they were all for resale as there would be spaces required for players, execs, sponsors etc. As for catering we had to purchase that from ACL but were then free to charge whatever we liked, that's a lot less margin than the club getting it at cost.

Of course if you're correct and those revenues are insignificant Wasps will have no problem giving CCFC all the revenues it generates including things such as naming rights.

Well of course most people would love to be given money for free, and that would be great if someone generously decided they would do that for the club. So it seems from a couple of answers the 'no income' statement seems in the most part to actually mean money from the naming of the stadium, ok, now I understand. I imagine the counter argument may be well 'we paid for ACL, so we are not prepared to give our money away', and I would see their point.

 

[chiefdave]

Well of course most people would love to be given money for free.

I'm not sure I'd count £1.2m a year in rent as free!

 

[Mary_Mungo_Midge]

I'm not sure I'd count £1.2m a year in rent as free!

I think if you're going to criticise the £1.2m figure; I think you need to present an idea as to how any new stadium should be funded. By means of comparison, the King Power stadium, in Leicester, cost £37m, 12 years ago.

If you were to borrow over a reasonable term, the interest charges on that capital - or anything even close - would be well in excess of £1.2m per annum.

So, if you borrow to build; to claim the 365-day revenues Waggott speaks of, you'll pay significantly more in interest charges via conventional borrowing than the figures - I agree is too high - at £1.2m. If you build by means of equity investor, then they'd expect a more aggressive return. So, what's the answer?

I'm not accusing you of doing it, but it's easy to criticise without offering alternative or solution. Russell Brand is making a career out of it...

 

[albatross]

ACL's interest payments to the bank ranged from £450K per Qtr or about £1.8m per annum at a rate of 1.25% above the banks base rate. By 21012 reduced to about £1.6m as I assume the base rate reduced. So ACL still had to generate between £400k and £600K of additional income (excluding costs) simply to cover these costs.

 

[Godiva]

I think if you're going to criticise the £1.2m figure; I think you need to present an idea as to how any new stadium should be funded. By means of comparison, the King Power stadium, in Leicester, cost £37m, 12 years ago.

If you were to borrow over a reasonable term, the interest charges on that capital - or anything even close - would be well in excess of £1.2m per annum.

So, if you borrow to build; to claim the 365-day revenues Waggott speaks of, you'll pay significantly more in interest charges via conventional borrowing than the figures - I agree is too high - at £1.2m. If you build by means of equity investor, then they'd expect a more aggressive return. So, what's the answer?

I'm not accusing you of doing it, but it's easy to criticise without offering alternative or solution. Russell Brand is making a career out of it...

As you say: It's easy to criticise ...

But from what (little) we have been told they are looking to use approximately the same approach as when the Ricoh was build: Sell off leases to fund some of the building cost and as a result the remaining interest is lower than you expect. The Ricoh cost some £100m+ to build, but what was left to mortgage was only a fraction of that.

We don't know the exact financial plan, probably because sisu can't calculate in detail until the site is known and bought. There are so many factors that will decide the final budget.

 

[Mary_Mungo_Midge]

As you say: It's easy to criticise ...

But from what (little) we have been told they are looking to use approximately the same approach as when the Ricoh was build: Sell off leases to fund some of the building cost and as a result the remaining interest is lower than you expect. The Ricoh cost some £100m+ to build, but what was left to mortgage was only a fraction of that.

We don't know the exact financial plan, probably because sisu can't calculate in detail until the site is known and bought. There are so many factors that will decide the final budget.

Yeah, I can see that. The issue with selling off leases is like the issues of revenues and naming rights. Until the venue and design are known, these figures have no meaning. Taking naming rights as an example; the fact that The Ricoh may be worth some £1m per annum doesn't mean a less high-profile stadium in a more remote location will have anything like this value. It could be a quarter of this. Even less.

Should the above also stand good as far as selling on sub-leases; you can't define how much financing is needed - and by virtue of this how much interest might be needed on any capital borrowed. And against this, how much is 'lost' per annum to the owners. Is it 'better' to pay £1.2m to CCC than a larger sum to a bank, for example?

Nothing is 'free' in this world. Especially borrowing money

 

[Deleted member 5849]

So, what's the answer?

In retrospect, or going forward?

Much as I hesitate to say it, going forwardif you were building a ground, it's why a 'modular' building process is probably wise. Football grounds, traditionally, grew organically as the club had the cash to build up and improve.

Going backward? Well... been there, done that. As an additional point though we, the fans, got sucked along into the 'no other option than the Ricoh'. It wasn't true then, much as it isn't true now (nor, for that matter, the 'no other option than SISU' line etc. or the 'club must own freehold' yadda yadda or... 'Wasps had no other option than the Ricoh ). Hopefully we move to a stage where we get there are *always* alternmatives.

It's about making sure the best alternative (or least worst in our case!) gets priority in the rhetoric... something that happens all too infrequently with us.

 

[Mary_Mungo_Midge]

In retrospect, or going forward?

Much as I hesitate to say it, going forwardif you were building a ground, it's why a 'modular' building process is probably wise. Football grounds, traditionally, grew organically as the club had the cash to build up and improve.

Going backward? Well... been there, done that. As an additional point though we, the fans, got sucked along into the 'no other option than the Ricoh'. It wasn't true then, much as it isn't true now (nor, for that matter, the 'no other option than SISU' line etc. or the 'club must own freehold' yadda yadda or... 'Wasps had no other option than the Ricoh ). Hopefully we move to a stage where we get there are *always* alternmatives.

It's about making sure the best alternative (or least worst in our case!) gets priority in the rhetoric... something that happens all too infrequently with us.

When an element of both.

What mean is that the £1.2m is always banded about as being daylight robbery. And to an extent, I agree, it's far too high. But my issue is - how else could the stadium have been funded? Forget the £100m for the Ricoh and the complication of the exhibition halls, casino and the like. Hence my comparison to Leicester's stadium; which has less of the confusing froth associated with the Ricoh's build. Something in the parish of say, £35m. Or £40m now allowing for inflation in the last 12 years. As a hypothesis and without the involvement of CCC, would paying, say £2m+ in interest to RBS be more palatable that the sum to the council?


And learning lessons from mistakes from the past - as we have to start to do this as a club sometime, surely - what can the financing model be moving forwards? Which I know is rhetorical, given the ambiguity that still remains with regards location, design, facilities, etc.

I just get frustrated when people think that it's a simple comparison. i.e. A = £1.2m is bad, when you don't know what B is. What if B is an investment from an equity investor we don't know, who will remain in place for many, many years after SISU decide to leave the club, is that better?

 

[Noggin]

As you say: It's easy to criticise ...

But from what (little) we have been told they are looking to use approximately the same approach as when the Ricoh was build: Sell off leases to fund some of the building cost and as a result the remaining interest is lower than you expect. The Ricoh cost some £100m+ to build, but what was left to mortgage was only a fraction of that.

We don't know the exact financial plan, probably because sisu can't calculate in detail until the site is known and bought. There are so many factors that will decide the final budget.

It is easy to criticise because the numbers just don't work. we don't need an exact financial plan, you should just be able to jot down some assumption numbers on the back of a fag packet that show how this might work and I just don't see you can do that. It only just about worked at the Ricoh with the club needing to be bailed out, this time the club is in league 1 not the championship, doesn't have a stadium to sell to fund the project, has a much better and well established competitor to the stadium in the area and we have far too many supermarkets and out of town shopping areas.

Even in the perfect scenario (which I don't believe is possible here) where you build the stadium, use leases to dramatically reduce the amount that needs a mortgage and get a decent mortgage, you still have the problem of how did you get to this point? you need to borrow to fund the build. You can lend to developers at 10,15,20%+ and as far as im concerned this is a far riskier project than a standard 20% one.

Even if you do manage it all, I see no scenario where the profit from the extra revenues is more than the cost of the interest on the loans/mortgage.

Not to mention the fact that if you were serious about building a new stadium it would have been a much better option just to double what wasps were offering, you get a massive amount more for a massive amount less money.

 

[Deleted member 5849]

I just get frustrated when people think that it's a simple comparison. i.e. A = £1.2m is bad, when you don't know what B is. What if B is an investment from an equity investor we don't know, who will remain in place for many, many years after SISU decide to leave the club, is that better?

Well... my view has *always* been the £1.2mil daylight robbery, but daylight robbery not imposed by a desire to destroy the club or milk them as a cash cow, but more a badly thought out project that only got voted through once more commitments to regeneration were given, and a rather short lease. We ended up to a degree hamstrung between not having a ground 'cheap' enough to make building it viable, but not having all the bells and whistles promised with Arena 2000 to make it truly unique.

Now going forward, my own thought has always been a new ground can be viable, both as an asset on the books (pay down a mortgage, take in a lodger or two and it looks quite good, especially if you can get some people to pay for space on the site to reduce the cost too) and that, of course, is why it's a negotiating tactic for SISU. It *could* be viable...

It'd be even more viable if built as a sporting/leisure centre, of course. It's where a partnership with a university looks appealing. Maybe less viable for an investment fund (maybe), but we're so wrapped up in deciding SISU won't do it (fine) that we don't even try to campaign for CCC to find/offer land. If SISU left, a new ground becomes an even better option really, in terms of the intangible things such as identity, permanence... a sense of place if you will.

Problem is, by then it might be too late.

I don't see what's wrong with splitting, in this instance, ground and club away from SISU's wishes for the club. At the worst, our owners' bluff is called if they're presented with a site. We probably need to get away from the 60 acres idea too. Just as Arena 2000 got downscaled, so can this.

A nice simple 15k ground, extendable to 25k if needed, ideally in partnership with someone like Warwick Uni (doesn't have to be on the Warwick Uni campus btw) could be viable for the club. A shared ownership model there would reduce building and repayment costs, and as the two parties wouldn't be in competition, there'd be little of this survival of the fittest urge.

Profitable? Probably not. New grounds really aren't to begin with - Arsenal fans probably don't fully appreciate what a job Wenger's done in allowing them to pay down the debt on *their* ground without the club suffering *too* much, and new stands nearly did for the likes of Chelsea and Wolves.

Long term, however, it seems to me the best sporting way forward - and yes how to do it without wrecking the club (ha!) is the question so yes, tangentially your oiriginal question is quite right.

We need solutions.

 

[chiefdave]

I think if you're going to criticise the £1.2m figure; I think you need to present an idea as to how any new stadium should be funded. By means of comparison, the King Power stadium, in Leicester, cost £37m, 12 years ago.

If you were to borrow over a reasonable term, the interest charges on that capital - or anything even close - would be well in excess of £1.2m per annum.

So, if you borrow to build; to claim the 365-day revenues Waggott speaks of, you'll pay significantly more in interest charges via conventional borrowing than the figures - I agree is too high - at £1.2m. If you build by means of equity investor, then they'd expect a more aggressive return. So, what's the answer?

The Ricoh cost about £120m to build but if you look at the breakdown after all the grants, Tesco money etc CCC only put in £10m and then ACL put in the cost of the lease via a loan from YB. If we had been paying £1.2m a year for 100% ownership of ACL that would be more acceptable but it seems to me the football club was covering the vast majority, if not all, ACLs costs but not getting any of the benefit.

Plus of course we now know CCC can access credit at preferential rates so if that had been utilised from the start with a lower interest rate and longer repayment term ACLs annual repayments would have been significantly lower.

For me it seems it was down to the club to cover the cost of ACLs loan but for ACL to receive all revenues generated. hardly seems a fair deal. Maybe with a fairer deal we might not have needed to sell our share and maybe then we wouldn't have needed SISU and the disaster that has been.

 

[Noggin]

Profitable? Probably not. New grounds really aren't to begin with - Arsenal fans probably don't fully appreciate what a job Wenger's done in allowing them to pay down the debt on *their* ground without the club suffering *too* much, and new stands nearly did for the likes of Chelsea and Wolves.

Long term, however, it seems to me the best sporting way forward - and yes how to do it without wrecking the club (ha!) is the question so yes, tangentially your oiriginal question is quite right.

We need solutions.

if it's not profitable how is it a good thing sporting wise? the answer isn't ffp. it's a whole load of nonsense that waggott is spinning there. Our problem is we don't have the money to spend on players/wages, not that the ffp stops us spending money on players/wages.

 

[Rusty Trombone]

I'm not sure I'd count £1.2m a year in rent as free!

I imagine we must have been given all the income we were entitled to as part of the lease/rent payment, and any other future income that we may have been due must have been included in the sale price agreed when we foolishly sold our half of ACL. Any income other than that is being expected for free.

 

[albatross]

The Ricoh cost about £120m to build but if you look at the breakdown after all the grants, Tesco money etc CCC only put in £10m and then ACL put in the cost of the lease via a loan from YB. If we had been paying £1.2m a year for 100% ownership of ACL that would be more acceptable but it seems to me the football club was covering the vast majority, if not all, ACLs costs but not getting any of the benefit.

Plus of course we now know CCC can access credit at preferential rates so if that had been utilised from the start with a lower interest rate and longer repayment term ACLs annual repayments would have been significantly lower.

For me it seems it was down to the club to cover the cost of ACLs loan but for ACL to receive all revenues generated. hardly seems a fair deal. Maybe with a fairer deal we might not have needed to sell our share and maybe then we wouldn't have needed SISU and the disaster that has been.

As per my earlier post:

ACL's interest payments to the bank ranged from £450K per Qtr or about £1.8m per annum at a rate of 1.25% above the banks base rate. By 21012 reduced to about £1.6m as I assume the base rate reduced. So ACL still had to generate between £400k and £600K of additional income (excluding costs) simply to cover these costs. On top of this they had to find running costs etc..

the loan from CCC to ACL was at about 5% in line with a commercial loan and in line with EU Law. In law CCC cannot subsidise the football club with preferential rates. The same way a bank will expect to make a return.

 

[Deleted member 5849]

if it's not profitable how is it a good thing sporting wise? the answer isn't ffp. it's a whole load of nonsense that waggott is spinning there. Our problem is we don't have the money to spend on players/wages, not that the ffp stops us spending money on players/wages.

You confuse profit motive with sporting motive.

Oh, and I'm making an assumption that current owners are more interested in short term gain.

Although building a ground and flogging off the club before you depreciate the asset on the books could work...

 

[Rusty Trombone]

The Ricoh cost about £120m to build but if you look at the breakdown after all the grants, Tesco money etc CCC only put in £10m and then ACL put in the cost of the lease via a loan from YB. If we had been paying £1.2m a year for 100% ownership of ACL that would be more acceptable but it seems to me the football club was covering the vast majority, if not all, ACLs costs but not getting any of the benefit.

Plus of course we now know CCC can access credit at preferential rates so if that had been utilised from the start with a lower interest rate and longer repayment term ACLs annual repayments would have been significantly lower.

For me it seems it was down to the club to cover the cost of ACLs loan but for ACL to receive all revenues generated. hardly seems a fair deal. Maybe with a fairer deal we might not have needed to sell our share and maybe then we wouldn't have needed SISU and the disaster that has been.

There's a bit of spin in here Dave, and we all hate that don't we. The Tesco money belonged to the Council didn't it, it was their land to sell, so I don't see the need to dress it up as the Council not putting the money in, why not put the real figures out and let people decide based on that?

 

[chiefdave]

What mean is that the £1.2m is always banded about as being daylight robbery. And to an extent, I agree, it's far too high. But my issue is - how else could the stadium have been funded?

The Ricoh needed £10m of the councils money and then the £22m YB loan to complete (that might not be exact, going from memory!).

CCC could have taken a loan, assuming the football club couldn't get credit, on behalf of CCFC accessing the preferential terms available to them. The football club should then have been sold the lease (ie: CCFC own 100% of ACL) for £32m over X number of years.

That way they club could have had zero rent but would have been required to cover the loan repayments , possibly with a small additional profit for CCC as they facilitated the loan. The lease itself would act as security, any non payment or insolvency event (admin etc) causing the lease to revert to CCC.

That way we would have had smaller payments, possibly avoiding some if not all of our future problems and an incentive to make the Ricoh as successful as possible. They way it was actually done didn't really incentivise ACL as they were pretty much covered by our rent.

 

[chiefdave]

There's a bit of spin in here Dave, and we all hate that don't we. The Tesco money belonged to the Council didn't it, it was their land to sell, so I don't see the need to dress it up as the Council not putting the money in, why not put the real figures out and let people decide based on that?

Works both ways, how much was the land worth before it was decided to build a football stadium and Ricoh complex there? And I don't think it was actually the council who did the Tesco deal was it? Didn't they just hijack it at the last minute?

 

[chiefdave]

In law CCC cannot subsidise the football club with preferential rates. The same way a bank will expect to make a return.

In which case what is the point of the current CCC loan to ACL (or indeed other businesses), why did they not borrow commercially?

 

[Godiva]

Works both ways, how much was the land worth before it was decided to build a football stadium and Ricoh complex there?

This is key to understand how a new stadium could be partly financed without leaving a too much of an interest burden.

 

[Godiva]

In which case what is the point of the current CCC loan to ACL (or indeed other businesses), why did they not borrow commercially?

In fairness we do not know if terms have changed after Wasps have taken over. It may no longer be a loan on preferential rates.

 

[chiefdave]

This is key to understand how a new stadium could be partly financed without leaving a too much of an interest burden.

I'm not sure you can apply the same process to a new stadium build as the Ricoh anyway. You won't get Tesco pumping millions in or any other similar store so what are the alternatives or do we just look for something as cheap as possible.

We need to know what we're talking about in terms of annual loan repayments on a new stadium to be able to compare against the Ricoh. If we have to pay £1m a year for a new stadium but £100K rent at the Ricoh then unless we're making over £900K extra profit it all seems a little pointless, ignoring the issues around Wasps rebranding the stadium.

 

[albatross]

The loan to ACL was made commercially at 5% as per the judicial review. It was examined and concluded that CCC acted as an existing investor to ACL in order to protect the assets.

With CCFC (SISU) on rent strike the security of the Lease against the loan issued by the Yorkshire bank was below the then outstanding value of ACL. Without an anchor Tennant the value of ACL was greatly reduced and so they were rightly nervous of default. SISU did try to purchase the loan from the bank at what they valued it at but were not willing to meet the valuation so continued distressing ACL. Hence CCC enabled ACL to restructure the debt on a commercial basis much the same way as many businesses.

 

[Noggin]

You confuse profit motive with sporting motive.

I don't see the benefit either way, the club needs more money, a stadium that loses more money than paying rent provides less money which is bad financially and sporting wise. This isn't Arsenal where there is short just term pain for long term gain, this new stadium plan is just pain.

Oh, and I'm making an assumption that current owners are more interested in short term gain.

how is it good short term? the building of the stadium is the really difficult bit financially, the money they have to borrow for the building part has no security and will be very expensive, 30mill for 2 years at 20% interest is 6million pounds.Then they get to sell leases and get a long term reasonable rate interest.

Although building a ground and flogging off the club before you depreciate the asset on the books could work...

Obviously the club with a stadium is worth much more than the club without a stadium but is the club with a stadium really worth more than the club without a stadium + the cost of building said stadium? I doubt it very very much indeed.

 

[chiefdave]

The loan to ACL was made commercially at 5% as per the judicial review. It was examined and concluded that CCC acted as an existing investor to ACL in order to protect the assets.

I think you're missing my point. The point I'm making is that at day one CCC could have provisioned a loan to CCFC if CCFC couldn't obtain credit themselves. I don't think it's correct to say they need to have a stake in ACL to make the loan, they don't have a stake in ACL now and the loan is still in place and they don't have a stake in other businesses they have loaned money to.

If, as you seem to be implying, the loan was only ruled acceptable as CCC had a stake in ACL would the fact that it has now come to light that they have been in talks to sell to Wasps for 2 years be significant?

 

[Deleted member 5849]

This is key to understand how a new stadium could be partly financed without leaving a too much of an interest burden.

And is, I suppose (being charitable, and running with this for the sake of an argument) why you employ consultants but don't approach councils for planning permission just yet, as you'd hope to buy land cheap, and then get the permission to increase its value, as opposed to alerting potential rivals for land with use now beyond sheep.

(I appreciate before anyone jumps on me that this is a bit clutching at straws, but I look forward to our new ground at Burton Dassett )

 

[albatross]

I'm not sure you can apply the same process to a new stadium build as the Ricoh anyway. You won't get Tesco pumping millions in or any other similar store so what are the alternatives or do we just look for something as cheap as possible.

We need to know what we're talking about in terms of annual loan repayments on a new stadium to be able to compare against the Ricoh. If we have to pay £1m a year for a new stadium but £100K rent at the Ricoh then unless we're making over £900K extra profit it all seems a little pointless, ignoring the issues around Wasps rebranding the stadium.

I agree with this 100%. in the last accounts (2011) when CCFC took in £10m over £6m was money associated with TV, Sponsorship and other activities. Ticket sales accounted for about £3.5m. don't know what our income currently looks like but If we can get back to similar levels of income then that is about 1% of income. This will only be achieved by improving what is served up on the pitch.

 

[Noggin]

I don't see the benefit either way, the club needs more money, a stadium that loses more money than paying rent provides less money which is bad financially and sporting wise. This isn't Arsenal where there is short just term pain for long term gain, this new stadium plan is just pain.



how is it good short term? the building of the stadium is the really difficult bit financially, the money they have to borrow for the building part has no security and will be very expensive, 30mill for 2 years at 20% interest is 6million pounds.Then they get to sell leases and get a long term reasonable rate interest.



Obviously the club with a stadium is worth much more than the club without a stadium but is the club with a stadium really worth more than the club without a stadium + the cost of building said stadium? I doubt it very very much indeed.

My Math is horrible, 30mill at 20% interest for 2 years is 12mill not 6mill. Its just not viable.

 

[Godiva]

And is, I suppose (being charitable, and running with this for the sake of an argument) why you employ consultants but don't approach councils for planning permission just yet, as you'd hope to buy land cheap, and then get the permission to increase its value, as opposed to alerting potential rivals for land with use now beyond sheep.

(I appreciate before anyone jumps on me that this is a bit clutching at straws, but I look forward to our new ground at Burton Dassett )

Yes, and land can be acquired on an 'intention to buy' providing planning permission to build a stadium is granted.

Only, I wonder why they would be scared of competition. Leaks of paranoia. Who could be a competitor? It would require someone with a plan and finances. If they were more open they might attract interest from somebody who would like to be included in the project - set up a retail or something. Much more likely that would happen than someone decides to buy the land just because the club want to build a stadium.

 

[Deleted member 5849]

how is it good short term?

That was kind of my point... we have owners who, one assumes, are more interested in short term profit motive rather than long term sporting motive.

Obviously the club with a stadium is worth much more than the club without a stadium but is the club with a stadium really worth more than the club without a stadium + the cost of building said stadium? I doubt it very very much indeed.

From the owners' POV, get some partners in to help finance parts of it, stick it on the books as a nice new asset, in effect they have 'free' money.

But nothing, of course, is actually 'free'.

That asset only has full value for a limited time, as soon that value on the books will be depreciated, rather rapidly.

So, you build it, open it, flog off club and ground in that window where everything looks 'healthy', make profit (or in this case, mitigate your losses) and let someone else sort out the rest.