Memorandum submitted by Wembley National
Following the Committee Reports of May 1999
and March 2000, considerable progress has been made towards the
construction of the new National Stadium at Wembley.
WNSL submitted its planning application to the
London Borough of Brent in November 1999. Approval was given,
subject to agreement under Section 106 of the Town and Country
Planning Act, on 1 June 2000.
The core of the Section 106 agreement is the
provision of appropriate transport infrastructure for the area
around the National Stadium. Agreement was subsequently reached
with the active participation of the Minister for London, the
Mayor for London and London Underground Limited. In précis
Wembley will benefit from a rebuilt Wembley Park tube station
(funded by LUL with support of WNSL) and two new roads: the Stadium
Access Corridor and the (industrial) Estate Access Corridor. These
roads are funded by the Single Regeneration Budget with support
from WNSL. In total WNSL will pay £17.2 million at 2000 prices
towards the costs of these works.
WNSL asked for expressions of interest from
potential contractors in July 1999. Initial documentation was
received from 12 companies/consortia. WNSL compiled a shortlist
of three companies in September 1999 and Bovis Multiplex (BMX)
were selected as preferred contractor in February 2000.
WNSL entered into detailed discussions with
BMX but was unable to agree a final construction contract with
the joint venture. Key issues were the pricing of sub-contracts
within the total contract and the division of risks. WNSL broke
off negotiations with the consortium in August 2000. WNSL was
subsequently approached by Multiplex with a view to that company
assuming sole responsibility for the construction contract.
The WNSL board meeting of September 2000 agreed
in principle that Multiplex be appointed lead contractor. A detailed
contract has now been agreed with Multiplex of £326.5 million.
Multiplex are the company responsible for the
construction of Stadium Australia.
The total all-inclusive funding for the new
National Stadium covering the period 1997 to 2004 is as shown
Figures are rounded up.
The FA support provides back-up for WNSL's business plan.
It gives a "comfort zone" for the funders and ensures
that WNSL does not have to conclude key contracts ahead of financial
close. Total project costs are likely to be under £600 million.
Costs are approximately in line with those given to the Committee
in early 2000. Figures previously released related specifically
to the construction and did not include a range of costseg.
contingencies, insurance, rolled-up interest, Section 106 contribution
or management costs 1997 to 2004. The complete project budget
|FA Contribution to Sport England||20
|Professional Fees/Finance/Management/Pre-opening/All Contingency Costs
Figures are rounded up. Approximately £136 million has
already been committed. The construction contract, land purchase,
Section 106 and FA contribution to Sport England are now all fixed
WNSL selected Chase Manhattan Bank as lead arranger for the
company's loan syndication in February 2000. Chase are the global
number one in syndicated loan finance. In 1999 they took part
in syndications worth a total of 666 billion euro.
Chase has carried out an exacting Due Diligence on the WNSL
business plan over a period of eight months. Syndication was launched
on 23 October 2000. Chase Manhattan and WNSL presented the Wembley
business plan to 30 City Institutions on 1 November. Reaction
at the meeting was positive and Chase Manhattan and WNSL are aiming
to achieve financial close in December 2000.
Several pre-conditions need to be met prior to financial
close. These are essentially concluding contract details where
heads of terms have already been signed.
Work on demolishing the existing stadium will begin immediately
after financial close.
The Future of athletics at Wembley
WNSL remains of the view that the design team of the new
stadium has produced an excellent design for an athletics stadium
that does not prejudice the viewing experience of football or
rugby supporters. This is a view that has been supported by Sport
England, the Commission for the Built Environment, and, of course,
the Committee itself.
In order to ensure that it retained a positive long-term
relationship with the Government, the Football Association came
to an agreement with the Department for Culture, Media and Sport
to pay £20 million to Sport England, on the understanding
that the National Stadium would not be obliged to host athletics
WNSL's understanding was that the Department felt that £20
million was an appropriate amount for football to pay in return
for the management comfort of not having to install the athletics
platform, on the two occasions when it may be appropriate to do
sothe World Athletics Championship and a potential Olympic
WNSL subsequently made an application on 29 September 2000,
at the specific request of Sport England and the DCMS, to remove
the obligation to stage any athletics events, including the World
Athletics Championships and the Olympic Games.
This application was to be considered on 6 November 2000
but was deferred to 4 December 2000.
The DCMS and the BOA have requested that WNSL retain the
obligation to stage Olympic football and, should either code become
an Olympic event, rugby in any potential London Olympic Games.
WNSL supports this proposal
The DCMS and the BOA have, WNSL is given to understand, requested
that the opening and closing ceremonies of a potential Olympic
Games be held at the National Stadium. In such a scenario, track
and field athletics events would be held at a separate Athletics
Stadium with a minimum capacity of 65,000 seats.
WNSL is confused by this proposal. If 65,000 is an appropriate
capacity for an Olympic athletics event, such a crowd could be
comfortably supported in the National Stadium with the platform
in place, with no sight line compromise.
The BOA and DCMS proposal is that the opening and closing
ceremonies be held with Wembley in "football mode".
WNSL is unsure about the practicalities of this proposal.
As stated above, WNSL is endeavouring to ensure the payment
of £20 million to Sport England for use on the development
of a national home for athletics. Sport England has deferred determination
of WNSL's application. Payments will be:
|Plus 12 months||£3m
|Plus 24 months||£3m
|Plus 36 months||£5m
|Plus 48 months||£6m
General Admission ticket pricing is established by event
owners (eg the FA sets the pricing for a Challenge Cup Final and
England Internationals). WNSL has now concluded staging agreements
with the FA, the Football League and the Rugby Football League.
The FA is bound by the terms of the Lottery Funding Agreement
"The primary purpose of the Project must be to provide
and maintain a National Stadium which can attract and host the
Flagship Events and, in addition, to ensure that the nation
has every opportunity to purchase tickets for and gain access
to the National Stadium for Flagship events".
This has been interpreted as broadly tying ticket prices
in real terms for flagship events to existing prices on a like
for like seating basis.
The major marked difference between current pricing and future
general admission ticketing will be that event owners will no
longer be obliged to offer discounted tickets for restricted view
seats, as there are no such seats in the new stadium.
The 2005 World Athletics Championships
WNSL remains confident that the National Stadium would provide
a superb home for the 2005 World Athletics Championships in either
65,000 or 80,000 seat mode. Our preference would be 80,000 seat
The costs of converting Wembley into athletics mode remains
approximately that outlined in the evidence submitted to the Committee
in 1999 as between £15 and £20 million. Opening in 80,000
mode and subsequently "digging down" to create a football
and rugby only stadium (as with the Commonwealth Games stadium
in Manchester), would be likely to modestly reduce this figure.
WNSL has not carried out any more work on this option given current
We estimate that compensation to WNSL for loss of earnings
were the stadium to be constructed in 80,000 seat athletics mode
as being approximately £2 million, depending upon the agreement
with the event owner.
However, while the costs of the platform have not changed
over the last two years, a reversal of the decision to remove
athletics from Wembley would result in increased cost to the event
owner when compared to the original proposals.
WNSL has now contracted with Multiplex to open in 90,000
seat football mode. Given that this is a Fixed Price Contract,
alteration to the contract would need to be negotiated with the
contractor. This cost is unknown, but WNSL would expect this cost
to fall on the event owner.
Similarly WNSL would expect any extra costs of meeting a
specific opening date to fall onto the event owner. While the
stadium construction programme is intended to be complete by the
first quarter of 2004, WNSL cannot commit to opening by a specific
date without further underwriting. Firm opening dates tend to
create problems for construction projects. The Millennium Dome,
the Jubilee Line extension and the Millennium Stadium all bear
witness to this. Realistically the National Stadium will be open
well before the commencement of the 2005 Championships, but the
risk of maintaining the opening date would have to be assumed
by the event owner, not WNSL.
In order to stage the Championships WNSL would require a
firm contract with the event owner setting out WNSL's rights and
obligations. WNSL would need to be clear on the nature of the
event owner and the strength of the covenant available to fund
the costs of staging the event.
An alternative design
WNSL remains convinced that the current design for the National
Stadium is the most appropriate response to the brief prepared
in response to the Lottery Funding Agreement with Sport England:
ie, a stadium that will host 20 football/rugby matches each year,
and will only host occasional athletics events.
The main users of the stadium are football and rugby league,
the main funder of the stadium football.
The only canvassed alternative design is a move to retractable
seating on the model of the Stade de France. This would raise
Capacity and Footprint
Despite having 10,000 more seats and 5cm extra legroom for
each spectator, the new Wembley has a footprint almost identical
to that of the Stade de France (Wembley will have an enclosure
line of 935 metres compared to 950 metres for the Parisian stadium).
Because a permanent athletics track would be included in
a Wembley re-design, albeit usually hidden by a retractable roof
tier of seating, the upper tiers of seating would need to be permanently
fixed for optimum athletics viewing lines. This would reduce the
number of seats it is possible to fit onto the footprint available
at Wembley to approximately 80,000 seats. Even if it were possible
to acquire additional land, seats over 80,000, in this scenario,
would be outside an acceptable viewing distance for football and
Given that seats over and above 80,000 would be the most
costly seats to build and would have to be discounted due to poor
views, it is likely that no economic case could be made for such
a stadium design with a capacity of over 80,000 seats for football/rugby
league with retractable seating.
When comparisons are made with the Stade de France, it should
be borne in mind that several features in the Stade de France
would not meet recommended United Kingdom stadium practice. Examples
include the low provision of concourse facilities, toilets and
concessions stands, the exposed concourse areas and the nature
of the access/escape stairs to the upper tier.
Acceptable viewing standards
A stadium similar to the design used at the Stade de France
would have the design feature of placing the "corners"
of the football lower tier in the sight line of many spectators,
obscuring views of runners on the bends. Roughly 5,000 seats with
sight lines would be obscured by walls rather than spectators
heads. In addition spectators in the mid and upper tiers would
not only be placed further back for football and rugby, they would
suffer inferior "c" values during athletics events when
compared to the design proposed for Wembley.
Given that an 80,000 seat stadium for football rugby league
would have its capacity reduced to 75,000 in athletics mode (as
is the case with the Stade de France), a further 5,000 "unacceptable"
seats would produce a stadium with only 70,000 seats acceptable
to the DCMS/BOA. This is substantially below the 80,000 seats
deemed necessary by the BOA in order to make an Olympic bid. If
80,000 seats is the minimum Olympic requirement, the confusion
in relation to the opening and closing ceremonies increases. An
athletics venue of 80,000 would be far superior to a 90,000 football
venue for an opening and closing ceremony.
The current stadium is designed to generate a substantial
proportion of income from premium seats. In practice these seats
cross-subsidise general admission tickets. Reducing either the
quality or capacity of the stadium would render the project unfundable
under the current business plan.
Funding for construction is currently secured by the FA underwriting
several parts of the WNSL business plan. With a revised business
plan it is unlikely that this FA support would be forthcoming.
Leaving a gap of at least £100 million in project funding.
WNSL has spent approximately £30 million, excluding
land purchase costs, to reach the current position. All of these
costs would be abortive and approximately two years would be lost
to the project, adding inflation costs to the overall project
As explained above, a move to retractable seating would change
the stadium design fundamentally. Such a redesign would take at
least 12 months. The current planning permission would fall if
a new design were proposed. It is likely that it would take at
least a further 12 months to put in place a usable planning permission.
The current stadium is to be built in 39 months, so it is reasonable
to assume a similar construction time for any new design. This
gives a best case opening date of second quarter 2006 if work
on a new design began in January 2001. This figure does not allow
for any additional time to attract private sector funding or the
negotiation of a construction contract.
In conclusion, in relation to an alternative design:
It is likely that a redesign of the stadium would
lose FA support, leading to at least a £100 million gap in
It is likely that the redevelopment would then
have to be led by a new organisation;
A stadium with a retractable lower tier would
provide only 70,000 "acceptable" seats under BOA criteria
on sight lines;
There would be abortive costs of £30 million
plus inflationary pressures on the new design;
The issue of a warm-up track would remain and
could not be resolved within the present landholding; and
A resigned stadium would not be open for the 2005
World Athletics Championships.