Wembley Stadium may be forced to borrow money from the Football Association to help keep up with repayments with banks following the latest pre-tax loss of £31.1 million.
The national stadium of England's football team will face defaults on bank loan agreements if the repayments are not met leaving the stadium, which was completed in 2007, to seek help from the FA to meet deadline payments.
The recession may have contributed to the annual loss as VIP seats and Club Wembley seats look to have gone down in sales. With two thirds of Wembley's annual income coming through these sales it will be badly hit if renewals fall next term.
Wembley is not expected to make a profit until after the 2014 season as it continues to repay the £326 million bank loan which funded the majority of the construction cost. With loan repayments reaching approximately £23 million per year, Wembley is set to settle the agreement in 2023.
A Wembley stadium accounts statement certified that officials had approached the FA:
“A significant reduction in Club Wembley renewals or a delay in season fee payments could put the company in default of its banking covenants.
“This specific uncertainty has been discussed with the FA and the directors are confident additional support is available should this be required.”
David Bernstein, Wembley National Stadium Limited Chairman also added: “We are not immune from the global economic slowdown, but we believe Wembley's facilities will reduce any downside in the next 12 months.”
Posted on 01/11/2009