Newham council have given up their 35% shareholding in the London Stadium in return for community and regeneration benefits for all Newham residents over the next 100 years the council announced in a Press conference today.
In 2011, Newham’s full council voted unanimously to invest £40 million into the stadium business, which subsequently became known as E20. In order to support stadium losses, Newham Council invested a further £12.2 million in working capital and additional investment between February 2015 and June 2017.
The press release says “Newham’s total investment in the stadium was £52.2 million. The council is certain the decision to invest was the right one as its estimates show the value in regeneration, community and other financial benefits over the next 25 years far exceed the investment. The council expects the value accruing from current and future developments in Newham to be between £70 million and £100 million. This is a mixture of direct income generated and the unlocked value of land through regeneration. It excludes the additional value of the community benefits secured as a result of the council’s investment.”
The Mayor of Newham Sir Robin Wales who is also a West Ham fan said: “On behalf of Newham residents, I am angry that the deals and decisions made by the former Mayor of London and his administration have left the stadium finances in such a dreadful mess. It is regrettable that the finances of the stadium have not followed the expected course. It was vital for Newham however that the stadium remained a public asset in public ownership, to maximise its regeneration, community and other financial benefits.
“Without our investment, the East End would have been blighted with a second-class athletics-only stadium which would be used for only a handful of days every year. It is clear to me therefore that had we not invested we would now be sitting with a stadium left idle or in ruins, a white elephant, like so many previous Olympic venues. These unused, unloved venues brand the hosts with the scars of decay and failure, the very opposite of regeneration, legacy and economic growth. It was a spectre we could not afford to have at the heart of our borough.
“It was our involvement that ensured the Stadium was transformed into a multi-purpose venue. It was our involvement that ensured a community benefits package. It was our involvement that brought jobs, regeneration and growth to Newham.
“Newham’s end of the deal was to provide the £40 million required to deliver the stadium transformation. Our investment helped create a world-class multi-purpose venue, which is now used year round to host national and international sporting and entertainment events. The former Mayor of London and his administration were exclusively responsible for making the decisions and signing the contracts to bring the business into the stadium, including agreements with West Ham United, UK Athletics and the stadium operators. This council was excluded from those negotiations due to our previous relationship with West Ham United. It is now clear that they completely failed to hold up their end of the bargain, which has led us to where we are today.
“Our decision to invest was based on the entirely reasonable assumption that the previous Mayoral administration carried out its contract negotiations for E20 with due diligence. Those contracts have now been found to be onerous and, if the stadium is to return to profitability, they must be revisited by the new Mayor of London and his team. I am confident the mess left behind by the previous London Mayoral administration can be turned around by the Mayor of London and his team. We remain committed to working with Sadiq Khan to ensure the stadium is a success in Newham.”
The full press release can be found at https://www.newham.gov.uk/Pages/News/Newham-Council-agrees-future-ownership-and-legacy-benefits-of-London-Stadium.aspx