What the playground squabble really means

The current standoff between London Stadium owners and West Ham could be described as a playground squabble with each party trying to get in the last convinced their position is right. Both sides seem to suggest the other one is misleading the public but who is right?

First let me cover what they do agree on,  LLDC confirm West Ham are now paying £3m in rent per year. They helpfully explain that as the £2.5m rent was index linked it now stands at £2.675m with over £300k per year paid for extra rights.

They do argue West Ham’s £6m figure from catering which is the total revenue figure received by catering firm Delaware North, the caterers presumably need to pay their match day staff out that £6m as well as their wholesale costs for the  food and drink they sell before adding on their fat profit margin for the American company.   

LLDC claim their cut of the catering profit is just £30,000 per game so with 19 league games and 2 cup games played at the London Stadium last season that works out at around £630,000. West Ham shares also 30% of catering revenue profit on anything over £500,000 each season.  It does beg the question on how good the catering deal is they agreed.

The next dispute is the match day running costs which LLDC say have increased from £200,000 to £270,000 per game since the Burnley incident. It is true that at figure twenty one games would cost them £5.67m per season therefore dwarfing the £3.63m they receive from West Ham but that again is a reflection of the deal that struck with French operator London Stadium 185.

LLDC CEO Lyn Garner has already confirmed that her team is going through the operators charges line by line after the operator revealed a £5m gross profit last year which caused some to question whether the deal offers value for money.

Possible the most interesting and revealing statement in yesterday’s LLDC letter  was the line that “At no time did we lay blame at West Ham for this but made it clear this was down to a contract signed in 2013 which both underestimated costs and also left too much to interpretation as to what West Ham was entitled to for their fee.”

This both confirms that previous LLDC leadership underestimated the costs and agreed a deal at too low of a rent but also that the contract leaves too much for interpretation as to what West Ham are entitled. This is a large part of the reason LLDC and E20 have spent £6m in legal costs and why they have a good chance of losing their upcoming court case on capacity.