Saturday, August 18, 2018

Ground for concern at Tottenham Hotspur ?

During my Shell career I was from time to time involved in major capital projects - usually indirectly, once or twice closer to home. Almost without exception these projects cost more - often a lot more - than the original estimate and took longer - often a lot longer. Now Shell was in the big league where such projects were concerned. For a time we were the largest private sector investor in the world. We were pretty good at what we did, it was just that management of major projects is very, very difficult. I mention this to say that I am sympathetic to the challenge that Daniel Levy, Chairman of Tottenham Hotspur and his Board have faced with the new Spurs stadium. It hasn’t been easy. It never is. And unlike Shell Levy and Co. have no prior experience, though no doubt they have employed many contractors and people who have.

I don’t think sports stadiums are inherently more subject to cost overruns and to delay than other building projects. It tends to happen though - remember Wembley ? Cost and timing are inextricably linked. Spurs wanted the new ground to be ready for the beginning of the 2018/19 season and this became a firm target. As it seemed to be slipping extra efforts were made, and this cost money. If you’re a jobbing electrician £400 a day is on offer now to help complete the work before the end of this year (my guess as to the real target now that the revised original one has been missed. Spurs haven’t been helped by cost increases from the decline of the pound either - many items are Euro or Dollar denominated. 

If I am sympathetic to Spurs Chairman it is in part because he has achieved so much. To create a world class venue on the very site of the old White Hart Lane is an astonishing achievement. It required acquiring land all around Spurs N17 home and overcoming demanding planning objections. Levy has been very smart and Spurs fans have been lucky to have him. Call me an elitist but I’d rather have him with his Economics degree from Cambridge than the average Club chairman ! That said recent weeks have not seen Levy nor the Club at its best. A football club’s principal stakeholder has to be its fans with season ticket holders the most committed of these. Many of us made special arrangements to be sure that we would be able to be present at the first match at the new stadium originally planned for September 15th. We received little more than one month’s notice about the change. 

Spurs are generally pretty good at stakeholder communications but over the new stadium timetable and cost we have been kept in the dark. It is hard to avoid the conclusion that the Club’s inactivity in the transfer market has been in part caused by financial concerns about the stadium’s escalating costs. You can factor the delays into this as well. Up to a point you can buy your way out of time pressure trouble in projects by committing more resources - but at a cost. 

Spurs have played the safety card recently to help explain the delays. This strikes me as disingenuous. Any construction project in  modern times builds safety in from the start. Similarly in respect of architectural design. Last minute safety concerns just weeks away from the planned opening, the Club’s explanation for the delay, should not have happened. If it did. The suspicion is that the Club used safety as an excuse because nobody could challenge that safety comes first. It has the smell of a bit of a cover up to me.

It’s going to be a difficult few weeks for Tottenham Hotspur. Uncertainty of dates and venues is disruptive for fans and players alike. If the team weather this storm by stringing some decent results together they will do very well. Come the dawn the future for the Club is bright. All the signs are that the new White Hart Lane will be magnificent and despite the transfer inactivity the squad is outstanding. To me only one thing is lacking and that is greater financial security in the short to medium term. In the long term a 60,000 seat stadium in London should generate huge revenues - and not just from football. But just now the Club is very stretched and if a white knight emerged as a minority investor with a nice slug of ready money surely that would be welcome.  I’m sure Dan Levy knows this and is on the case !  

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