Newcastle will sign 'cheque of a generation' to make stadium plans happen (original) (raw)

Newcastle United are preparing to write a “once-in-a-generation” cheque to resolve the St James’ Park expansion dilemma – with a definitive decision on next steps now “really, truly” imminent.

In a clear sign that the club are in the final stages of a decision on the huge stadium project, Newcastle’s new chief operating officer Brad Miller has offered reassurances over the ownership’s “overwhelming” commitment to invest either in St James’ Park or a new build elsewhere in the city.

Miller, who was appointed in June, says the board is now “working through the last couple of questions we’ve got” after the completion of a wide-ranging, six-figure feasibility study into possible options which has included “war gaming” the issues around both a sizeable expansion of St James’ Park and also how a new-build stadium would work in practice.

In his first major interview, Miller – who will be responsible for overseeing a series of infrastructure projects on the horizon, including a possible training ground rebuild – said his own decision to relocate his family and join the club was driven by what he had been told about their infrastructure plans before he committed to the job.

The stadium project continues to dominate the off-the-field agenda at Newcastle after a study was set in motion in 2022 to determine next steps. A decision now appears close.

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“Darren [Eales, chief executive] has gone on record previously to say ‘Look it’s imminent’ but it really, truly is in terms of next steps [and] what direction we’re going to be taking,” Miller said, citing last week’s opening of the Stack fanzone at St James’ Park as proof of the club’s commitment to infrastructure projects.

“It’d be remiss of me to go early and cut across that but what I will say is that [Stack] is just an indication of the ambition and the commitment and the dedication that the ownership and everybody within the club has got, not just to Newcastle United, but to the region as well.

“We hope it’s representative and a little bit of a hint to what we’re hoping to achieve into the future. The stadium investment is genuinely a once-in-a-generation opportunity and we want to make sure that we get that right.

“I think we’re doing that against the backdrop of, in the UK, we haven’t got a great track record of delivering really big projects, delivering [them] on time, successfully and making sure they work right from the absolute outset.

“So there’s a lot for us to think about and that’s why we are, maybe frustratingly for people, taking our time to make sure that our next steps are going to be the right ones.

“Because whilst we’ve got the ability to invest and the commitment and the ambition to invest from the ownership, we only want to write that cheque once so we want to make sure we get it absolutely right for everybody that’s involved with the club.”

Miller also said he had been conducting straw polls with fans he had met to ascertain the depth of feeling among a supporter base about a possible move from St James’ Park.

i has been told by several sources that the club’s overwhelming preference is to find a solution that updates and expands St James’ Park but there are significant planning challenges to be overcome, with the stadium surrounded by listed buildings.

Miller declined to confirm whether anything has been ruled out at this stage and it is understood that the cost of rebuilding on alternative sites are part of a feasibility study looking into the “art of the possible”.

Industry experts have told i the cost of the project will stretch into the billions. HKS, the masterminds behind the £4.8bn SoFi Stadium who held talks with Newcastle last year, told i an innovative solution to the Magpies’ problems is possible but will be expensive.

HKS principal Alex Thomas admitted a new build would be a much easier proposition, even if the initial outlay would be eye-watering.

So what is the latest on the stadium?

Newcastle hope to announce their plans for stadium expansion in due course (Photo: Getty)

Further communication on the stadium issue is expected from the club before the autumn – and not before time.

The tone of Miller’s quotes suggest that will be definitive in terms of answering the biggest issue: whether to expand St James’ Park or move to a new site.

The club’s board have been kept updated on the feasibility study but sign off on whatever comes next has to come from Saudi Arabia’s Public Investment Fund (PIF), the club’s majority owners, who will also have to decide how it is funded.

While PIF has the resources to pay for whatever comes next, their “process-driven” approach means this will not be a vanity project.

The impact on future revenue is chief among their considerations before writing what Miller admits is a cheque for a “once-in-generation” amount.

How ambitious are the plans?

One of the reasons the stadium issue is so important is that it comes with the club at a crossroads and fans trawling for signs of the ownership’s intent.

With Profitability and Sustainability Regulations (PSR) hemming the club’s ability to restock their squad recently, infrastructure is one area where there is freedom to spend.

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St James’ Park is a fine stadium that has been picked to host games at Euro 2028 and has an iconic, city centre location.

But it is also relatively old compared to some of their rivals and with Newcastle in dire need of driving further revenue a substantial investment is required to bring it up to speed and make it fit to hold concerts and possible NFL games.

Miller suggests that commitment is present in the ownership.

“What I can definitely say is that one of the reasons that I joined the club is because there seems to be such an overwhelming commitment and ambition to invest,” he said.

“To give a cast iron guarantee that [the stadium] definitely will happen, it is not my cash. So all I can say is that I’m not putting myself in comparison to the fans because they are so emotionally invested and I’ve only just started to move to the area so I don’t want to cut across all of that history and that heritage.

“I want to be respectful of it, but I’m changing my life and my family’s life, and we’re moving to the area and we’re really committing.

“So if that’s any indication, that’s how I feel about it personally, and the ownership and the board’s ambition about what they want to do in terms of investment, I hope that gives a little bit of a reflection of what I see.

“Now, when we get on with it, it is going to be a really big cheque that’s going to be written, so they want to make sure that we are doing it correctly and that it’s doing the right things, whether that be supporting the football, doing the right thing by the fans.

“Have we got the ability to uplift the capacity? Is it going to actually make a return so we can continue to invest in the club?”

Club supporters have been consulted during the process (Photo: Getty)

Intriguingly Miller has taken to polling fans and city representatives he has met about whether they would be tempted to move to a new build stadium or stay at St James’ Park. He gets the “palpable” sense of emotion around the decision.

“One of the things that I’ve been taking the opportunity to do is to do a bit of a straw poll, just so I can get a feel,” he said.

“It’s anecdotal and you can only speak to so many people, but at least it gives me firsthand experience and I see the reaction in people’s faces when I ask ‘If it was up to you, what would you choose to do?’

“It tends to be [that] there’s a couple of things that come out. People are okay with being a bit open-minded and sort of exploring what might that mean.

“Other people are just ‘no’ and oppose it straight away. And the reason, when I ask why is that, they give the reasons it’s where my parents took me, that’s where my grandparents took me, I’ve got all of that emotion, I’ve got all that feeling.

“I know where I sat or where I was in the stand when that first happened, that’s when I first fell in love. You can’t put that stuff into a spreadsheet and so it’s, how do we make sure that across all of those things, we are doing the right thing, both for the short term and for the long term. That is why it’s taken a bit of time.”

Why the hold up?

One problem is the stadium is surrounded by listed buildings (Photo: Getty)

Miller said there were other, practical reasons why Newcastle’s due diligence on the stadium has stretched into a second year and could continue for a few more weeks.

“With any big investment and any big project, 80 per cent of all of the value is created in the first 20 per cent of a project’s life and you can imagine you’re trying to wrestle with what exactly are we trying to achieve, what is the art of the possible, where do we want to invest, what are the big risks that are going to stop us doing that or maybe get in the way and slow us down and you’re trying to understand all those things,” he explained.

“It’s also [that] we want to be able to continue to invest as much as we can and support the footballing side of the club and so we have to look at the revenue and the commercial aspects too.

“So it’s all those things coming together, we want to make sure that we are getting it right. We’ve not done it [stadium expansion] here for 22 years so for all that it may feel like it’s taken a long time, it’s not that out of the ordinary for a big project from my experience.

“The biggest difference here is that everybody is so, and quite rightly, why wouldn’t they be, so emotionally invested in the club.

“So we get and understand why it is so important. That adds that other dimension of that is another reason why we want to get it right.”

Are Newcastle close to adding more sponsors?

At how many other clubs in the Premier League are the actions of the chief commercial officer so closely scrutinised as Peter Silverstone’s are at Newcastle?

But then that’s the name of the game at St James’ Park, where PSR has become an obsession because of the limits it is placing on Newcastle’s ability to grow.

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A target of doubling revenue every two years mean every potential partnership is poured over.

“We continue to grow, we’ve got a long runway, we’re making incredible progress and opening the Stack fanzone is another sign of progress,” Silverstone said when asked to offer a summary of where the club is commercially.

“We have our temporary retail store, which is doing incredible business but is the precursor for what’s going to be another best-in-class investment in the new store, which again leads to more commercial revenues.

“We continue to grow, both from a resource perspective but ultimately what’s most important from a revenue perspective, because every penny we generate is spent on the pitch, both men’s and women’s teams and ensuring that we can compete at the top of all our respective divisions.”

A couple of big partnerships are in the offing. But they are holding back on the transformative, big ticket ones like a training kit or training ground sponsor.

So why haven’t the club got training kit and training ground sponsors yet?

Newcastle’s training kit lacks a front of shirt sponsor (Photo: Getty)

Chief among the questions supporters want to know is why some premium advertising space – most notably some that could adorn the training kit – remains unsold at Newcastle as the club wrestles with PSR concerns.

“Everyone thinks that because some clubs have a training ground sponsor that they fall from the trees,” he told i in response to that question.

“You have to pick the right partner, get the right values, the right fit and it takes time.

“But obviously my job and the job of the team behind me is to maximise the opportunity in every area, whether that’s retail, whether that’s media, whether that’s membership, whether that’s retail, whether that’s partnerships.

“So we’re looking at all opportunities. I’m aware of what everyone thinks should or shouldn’t be sold. I also know what we are working on and trying to deliver.”

There has been interest. “Yeah, absolutely. It’s about what you’ve got to prioritise as well. You can’t go after everything at once,” he said.

“So you’ve got to prioritise an incredible kit launch with Adidas and it’s maximising that opportunity, the opening of stack, which is taking hundreds of people, a huge amount of time and effort to get this delivered by the beginning of the season. So everything takes time.

“We’re growing truly, steadily and trying to maximise all the opportunities you’ve mentioned and others.”

Where is the club as an off-the-field proposition?

Eddie Howe is still waiting for his big summer signing (Photo: Getty)

One of Silverstone’s most telling points is that Newcastle are playing “catch up” with their Premier League rivals.

It was a point that was inescapable as they travelled to Japan in pre-season – a tour that, like their trip to Australia in May, came with a fairly negligible financial reward and demands on the squad but is intended to lay foundations.

“Being in Japan and seeing the passion of that fan base and the intensity of that fan base, if only we had engaged with them over the last 26 years, we might not be having to catch up so rapidly and that fan base might be slightly bigger,” Silverstone said.

It is difficult for supporters to hear but the language about Newcastle being a “long-term project” is deliberate. There are balances to be weighed up and difficult decisions to make. Do you, for example, press the button on a sponsorship now that will look undervalued in three years?

“I’ve worked in sports, marketing sports, sponsorship for over 20 years,” Silverstone said.

“I’ve worked in the Premier League for 10 years. No sponsorship deal is easy, none. It doesn’t matter if you’re whatever club you are in the hierarchy of the Premier League or European football.

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“Every sponsorship deal takes time. It’s about two businesses, two brands coming together and partnering and they don’t just fall from trees.

“Our job is to make sure we now maximise the value and the future value of Newcastle United. We don’t want to do deals at value now, where in one to two years when we get closer to our ambitions are undervalued.

“It’s a fine balance but we need to find the right partners at the right value and other clubs are trying to do the same. It’s a really competitive landscape.

“We have some very unique assets, Stack is one of them. We have a beer partner which is now our beer partner for the stadium and this venue.

“We have another couple of partners where the integration will be with both the venue, stadium and the venue. So Stack is providing sponsorship inventory. Look Sela is a part of this and Sela obviously who create events and destinations, spectacular events and destinations in Saudi Arabia and now they have branched out globally to Los Angeles, they will be part of this experience as well which again is more value to sell to sponsors and partners which will differentiate us from, the 19 other clubs in the Premier League who are all chasing the same ambitions and dreams and the same sponsors.”

Do the associated party transactions rules make life more difficult for Newcastle?

Associated party transaction regulations hit the headlines earlier this year as Manchester City prepared a legal challenge to the Premier League tightening them earlier this year.

The rules around sponsorship deals with companies linked to club owners were tightened after the Newcastle takeover in 2021 – now there are layers of evidence that need to be provided before deals can be ratified.

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It is ironic in one way because insiders suggest there are absolutely no special favours from PIF-associated firms or clubs in the Saudi Pro League.

A sponsorship deal with Sela was struck at market rates, they point out, and only one player has been sold to a SPL club so far (Allan Saint-Maximin, who was one of their star assets).

Suggestions of chicanery around transfers or sponsorship deals simply don’t tally with the experience of decision-makers at the club and Silverstone insisted the club had no issues with them.

“The rules are the same as they were when I joined the club on 22 October and the rules are very clear, yes there have been some tweaks but it’s very clear what the rules are,” he told i.

“We know what the rules are and we work around them. Every club has to do the same. It’s the same for Newcastle as they are for the 19 other Premier League clubs.”