Exclusive: Stamford Bridge could be Chelsea’s home for 1000 years after shareholder vote
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Updated 02/01/2017 at 13:20 GMT
Could a hold-up in plans to rebuild Stamford Bridge be eased by a proposal to let Chelsea call it their home for the next 1000 years? Dan Levene delivers an exclusive report on the latest developments...
Chelsea owner Roman Abramovich applauds after the English Premier League soccer match between Chelsea and Hull City at Stamford Bridge in London
Image credit: Reuters
It is now more than a year since Roman Abramovich revealed plans to bulldoze and rebuild Chelsea's home as a 60,000 capacity stadium for generations to come.
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Fans arrive at Stamford Bridge in London for a match at Chelsea's stadium
Image credit: AFP
Those plans remain with Hammersmith & Fulham Council, who will decide on their suitability in coming months.
But the unique ownership of Stamford Bridge, and the impact this has on the Russian's plan, have long led to questions over the viability of any redevelopment – questions which may be about to receive an answer.
Chelsea Football Club lease Stamford Bridge from Chelsea Pitch Owners (CPO) – a shareholder organisation set-up by Ken Bates, to stop the highly valuable ground from falling into football-unfriendly hands.
There's an important distinction here: we are not talking about renting from a landlord, with the usual six month or year-long contracts; this is a long-term land lease, initially agreed for 199 years.
It is a similar situation to when one buys a flat: what you tend to be purchasing is a lease, for anything up to 99 years, with the freeholder maintaining ownership of the land beneath your home.
If you are such a residential leaseholder, you will be aware that structural modifications to your property can be tricky.
If you go to your lender, and ask for the mortgage to be increased to fund an extension, the first question they will ask is how long you have left on the lease.
Any new borrowing will be secured against that lease: and it is obviously a more secure investment for the lender if you have 98 years left, than if you have only 12.
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Chelsea fans watch the action at Stamford Bridge
Image credit: Reuters
The same is true with a football ground: and, should Abramovich be looking towards new investors to bankroll this project, he will need to have certainty his freeholder (CPO) won't make changes to the existing arrangement.
For an investment of upwards of £500m in bricks and mortar, some wealthy benefactors may consider a shrinking lease of 180 years to be insufficient security.
That is why there has been much talk of a move by Abramovich to buy-out CPO: giving him sole ownership of Stamford Bridge.
He tried that, and failed, back in 2011: with many fans and shareholders keen to keep in place a strong ownership structure, safeguarding Stamford Bridge as a place for football, regardless of London's overheated land values.
The issue of the stadium ownership is a chess game going back to the 1980s, and CPO have just played the latest move: putting forward a potential proposal to extend Chelsea's lease, thus taking away the need for Abramovich to buy them out.
When Liverpool FC were considering their options to build a new stadium on Stanley Park, the City Council offered them a 999-year lease on the land, to allow them to seek investment for the project – and Chelsea could be looking at something similar here.
In the eyes of CPO's directors, this is an olive branch to Abramovich – after all, nobody wants the old wounds of that 2011 failed takeover reopened.
So, what are the chances of it happening?
CPO's directors have called a vote, to be tabled at their Annual General Meeting on 27 January.
The vote is not on whether to offer an extended lease, but on whether it should be an option open to the board – basically a bargaining chip in negotiations.
A total of 20,000 shares have been issued since the creation of CPO in 1993 - each worth a single vote. It is impossible to accurately characterise who owns them: most are owned by fans; some by those with business links to the club; others by carpet-baggers seeking to gain a profit. And there is overlap in those three categories.
In extending the lease, shareholders will be asked to lock their investment into Stamford Bridge for, potentially, the next 999 years.
Fans who forked out £100 a share to keep Chelsea at their home of over a century are likely have no issue with that.
While CPO notes that it has been 'working towards an amicable agreement regarding the redevelopment of Stamford Bridge' – suggesting Abramovich may already aware of the plan.
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Abramovich
Image credit: Reuters
But the carpet-baggers will be seeking a pay day: and scuppering the possibility of an increased cash offer for their shareholding will not be well received.
The CPO Board has recommended shareholders vote in favour of all this: and they need one vote more than 50% of the turnout to carry the motion.
If they get that, the prospect of a 60,000 capacity super stadium, part-owned by Chelsea's fans, may take a step closer to being a reality before this month is out.
-- Dan Levene
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