The cheers rang long and loud around Valencia’s Mestalla Stadium as fans celebrated Hugo Guillamon’s late equaliser against Barcelona in their final home match before La Liga’s Christmas break.
Four kilometres away, on the other side of Valencia’s old town, all quiet around the Nou Mestalla, where the club’s new, half-built house has remained untouched for more than 15 years.
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Meanwhile, one of La Liga’s most prominent clubs has found itself stuck in this situation: it can’t muster the budget to build a new, modern ground, it can’t sell its historic home.
Meanwhile, a team accustomed to competing at the top of domestic and European competitions finds itself grappling with relegation as the club’s historical debts become increasingly difficult to repay.
On a recent stopover in Spain’s third-largest city, The Athletic took 20 minutes to navigate the perimeter of the massive Nou Mestalla venue. Inside the tall metal fence that surrounds the huge concrete bowl, there is no human presence, just a strange calm and silence.
Residents went about their business even watching, long accustomed to a situation that remains a major embarrassment to many of the city’s residents.
But external developments, coupled with investments organised through La Liga and the option to host some World Cup matches in 2030, now open up the option that, despite everything, a solution will be found.
“I think it’s now or never for the new stadium,” club president Lay Hoon Chan told enthusiastic skeptics at the club’s annual general meeting on Dec. 14.
Can Valencia really resolve its unique ‘two stadiums’ problem? And will the team really benefit?
Already on November 10, 2006, the president of Valencia, Juan Soler, presented the order for a “New Mestalla” with capacity for 75,000 people. To those gathered in the impressive futuristic setting of the City of Arts and Sciences of Valencia, he told them that it would be “the most productive stadium in the world” and that it would have 25,000 square meters of shops, cinemas and themed restaurants.
“This stadium represents Valencia’s preference to be an example in the world of football,” Soler said.
“We have the 2010 Champions League final to be played here,” said the city’s mayor, Rita Barbera, to enthusiastic applause from the crowd, adding the regional president, Francisco Camps.
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Soler’s plan to borrow the €260 million (£224 million; $284 million at the prevailing exchange rate) needed from local banks to build on land on the other side of the city provided through the council. The money would be reimbursed through the promotion of the development of the current Mestalla stadium. The move would even be profitable, he said, taking advantage of the city’s booming housing market.
Work began on 1 August 2007 with engineers Arup Sport and the brands FCC Construcciones and Grupo Bertolin. A few months later, the first signs of the bursting of the Spanish real estate bubble were temporarily followed by a banking crisis. Soler resigned as Valencia president in March 2008. Health problems”, and it soon became known that the club owed approximately €550 million.
On 25 February 2009, the new president, Juan Soriano, ordered the temporary suspension of all painting of the new stadium. Around €100 million had already been spent and the stadium’s first concrete base had been built. But there was no money to upload a striking reflective aluminum skin on top, and borrowing was impossible.
Over the next 14 years, four other club presidents (Manuel Llorente, Amadeo Salvo, Lay Hoon Chan and Anil Murthy) presented new and different plans for the stadium. Each style has become progressively more modest (or realistic) in terms of design. , capacity and imaginable budget.
But in recent years, nothing has replaced the peeling paint and sprawl of weeds around the half-finished structure on Avenida de las Cortes Valencianas.
When Singapore-based businessman Peter Lim took majority control of Valencia in 2014, he said the team would celebrate its centenary at the Nou Mestalla. That passed in 2019 at the old ground, which itself celebrated its 100th birthday last May.
“The new stadium was planned in the board meetings, but there was little guidance on how to proceed,” says a former director of Lim. Two other Nou Mestalla projects have been announced (in 2017 and 2020), but no real progress has been made. been done.
The situation was not replaced until December 2021, with La Liga’s €2 billion deal with CVC Capital Partners. Of the €120 million owed to Valencia, €80 million had to be spent on infrastructure. Murthy was quick to state that the total amount will be passed to solve his two-stage challenge and set a new conceivable date of September 2022 to resume work.
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The €80 million was about a fraction of what the club needed for the entire Nou Mestalla. The board has now been more “proactive” in collecting the remainder, according to a source involved in the proceedings who, like all those cited here, asked to speak anonymously. to protect relationships.
It was always clear that using the proceeds of the sale of the old Mestalla site to at least part-finance the move was difficult. Various plans with different local developers and a housing co-operative have been floated over the years, but no binding contracts signed.
The current chairman, Lay Hoon, said at the December 2023 Annual General Meeting that they now had “advanced negotiations” with a new client for the old stadium. But sources say no one will be buying an apartment in a place where a football team has been playing lately, especially when no one can confirm when that team will leave.
Valencia’s historical financial issues, which have not improved under Lim’s control, also make further borrowing difficult. The latest accounts show total debts of almost €500million — €134m short-term and €335m long-term liabilities. Among these is an €89m loan with local lender Caixabank, for which the old stadium is collateral. In the words of one former club executive: “If you sell this site, you have to pay off the bank — not use the money to build the new stadium.”
More useful is the option to promote the Nou Mestalla website component. The original plan still envisaged the structure of two nearby towers, with more than 40,000 square meters of floor space for hotel, advertising and residential use. In March 2023, a possible deal will be closed with local investors Atitlán, controlled through the Roig family, owners of the Spanish supermarket chain Mercadona. This would provide more than €30 million, once the new stadium is completed. The club also has around €5 million from the sale of the club’s offices, as opposed to the current house, with a hotel to be built on that site.
Valencia believe that the €115 million investment is enough to restart the half-finished stadium’s paintwork. They estimate that they would still want to raise around 15% of the total burden of €340 million from banks or investment funds, but this would not be until the final stages of the structural project. The club denies local media reports that it has already arranged two loans: €15 million from Caixabank (which owns the loan on the old stadium) and €15 million from the English fund Rights and Media Funding Limited (which, in November 2021, “advanced” €51 million to Valencia in exchange for a percentage of the long-term television rights).
No one in Valencia doubts that it makes sense to spend the CCV’s money on the project. But the club, heavily in debt and taking on even more responsibility, worries many fans. Others argue that the finishing touch to the new stadium is key to changing the club’s finances. No one can say for sure.
What is admitted is that the current loan to Nou Mestalla is a less ambitious edition of the “best stadium in the world” announced almost two decades ago.
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The original architects, now called Fenwick Iribarren, have maintained their connections throughout this period, adapting the design to other monetary realities and to the evolution of the industry’s most productive practices.
“Everyone has to admit that we are coming out of difficult economic times, but austerity does not mean that this stadium cannot be a lovely, charming stadium and a source of pride for Valencia CF fans,” said co-founder Mark Fenwick. in 2022.
The current plan is to have 66,000 seats, which can be expanded over time to 70,016. The previous design included an aluminum skin over the existing concrete base, but it was replaced by a less expensive façade. ” It’s a more open and airy concept,” says a source interested in planning, adding that it will be seen as a reflection of a “Mediterranean experience. “
Some 4,500 seats will be reserved for VIPs or used for hospitality purposes in the levels, plus nine “Mediterranean terraces” where fans will be able to eat paella with views of the pitch. The aim is to double the club’s profit from the existing €15 million to €30 million consistent with the year.
Generating profits 365 days a year is essential, plus for La Liga executives who largely oversee the spending of all CVC’s money. Those from Valencia are also very willing to link up with the local community. Restaurants will be open all week, while the club hopes to attract business gatherings and normal concerts. The existing design includes a nursery and nightclub, as well as one of the largest photovoltaic rooftops in Europe, which could potentially power the local grid in the future.
Those interested in the project categorically reject any description of “low cost”. They admit it probably won’t compete with the refurbished Santiago Bernabeu Stadium in terms of luxury facilities, but say its cost of €5,000 per seat is comparable to Atletico Madrid’s Estadio Metropolitano. , which hosted the 2019 Champions League final.
A concern, both internal and external to the club, is capacity. Valencia has just over 38,500 subscribers and the average attendance at its existing stadium in 2022-23 was 41,667. “How to make a 70,000-seat stadium commercially viable or sustainable has been the biggest challenge,” says a former club executive.
It is known that Valencia, a lovely city to visit, does not attract the same number of tourists as Madrid or Barcelona. The city of 800,000 people doesn’t have the thriving business network of a global hub like London or Milan. of the Arts and Sciences District and the 18,000-seat Roig Arena basketball arena, recently under construction, host competitions for special occasions and concerts.
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If Valencia were to start from scratch on a new pitch, they would have much more flexibility. But he’s in the scenario he’s in, with a half-built stadium that wants to be finished, and he wants to make the most of that reality.
Raising the money to restart work at the half-finished stadium, and making the design more realistic and sensible, was not easy for the current Valencia hierarchy. Another challenge was securing the necessary construction permits and licences.
A major stumbling block in the various revisions of the commission was the structure of a 13,000-square-metre sports centre, with a gym, swimming pool and tennis and paddle tennis courts, promised to the city council through Soler in 2006.
All subsequent citizens wanted to reduce this facility by 10 million euros (as did the design of the stadium). Barberá’s successor, Joan Ribó of the left-wing Compromiso coalition, said this was vitally important for his working-class citizens. Benicalap. La Lim’s strong unpopularity among Valencia enthusiasts has not prompted local politicians of all stripes to help him.
The election of María José Catalá of the centre-right People’s Party as mayor of the city in June 2023 has sparked optimism within the club that a solution can be found. He was out of position when Catalá said in August that “the New Mestalla is a disgrace” and that they “wouldn’t concede anything” to Lim.
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Then, in October 2023, Spain was named co-host of the 2030 World Cup, along with Portugal and Morocco. In less than a month, the regional government of Valencia, the city mayor and Valencia CF sent letters to the Spanish Football Federation stating that the paintings at the Nou Mestalla site would resume in the first part of 2024 and would be completed until 2026.
For a World Cup to take place in Spain, but Valencia not to host any games, is unthinkable for some in the city. Lim’s critics worry this provides leverage during negotiations over issues such as the public sports centre and re-zoning of the old Mestalla site. “Peter Lim is using the World Cup to blackmail the town hall,” says a former Valencia executive.
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Catalá said that painting the stadium must now begin, before starting negotiations for a new “pact” to redevelop the old Mestalla. “Valencia will have to take the first step, and thus regain the confidence of the city,” he said. he said in early November.
From the outside, it looks like a high-stakes poker game between the city government and the Valencian hierarchy. “All parties expect the other side to make the first commitment,” says the man who was involved in the previous negotiations. “That’s the biggest hurdle in this total project. “
One of the main protagonists of this game is now José María Olano, a lawyer hired through the city council by the company KPMG to supervise the transfer of Nou Mestalla and the redevelopment of the town’s port. Opposition parties in the mayor’s office have expressed their views loudly and clearly, given that Lim is a long-time consumer of KPMG. An internal report was commissioned that temporarily exempted Olano from any conflict of interest.
In the midst of all this politics, it’s very difficult for Valencia enthusiasts to know exactly what’s going on. Those who were disappointed by the team’s decade-long decline in Lim’s share price should not forget that it was local politicians who organized the sale of the club to the Singaporean businessman, because it favored local banks. The same local banks that still own most of the club’s huge debts.
Some in Valencia would like the local government to come with Lim’s departure from Valencia as a precondition for any new “pact” affecting the old Mestalla. But those interested in the task this is not realistic.
“Everyone here needs to use Valencia for their own benefit, whether it’s in local politics, in sports policy or in structural projects,” says a former club director. “But the football club may end up ruined. “
“Since I returned to the club last week, we have had many complicated meetings with local politicians to get the job done,” president Lay Hoon said at the Valencian club’s general assembly on Dec. 14. We need Valencia to host the 2030 World Cup, it would be smart for the city.
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Club staff say everyone is very keen to get started as soon as possible and that all the requested documents have been provided through the town hall, so paints on the site of the new stadium could begin in the first quarter of 2024. It would then take about two years to complete. All good, it’s possible that the team will play at its new home at the start of the 2026-27 season (and more work may be done to build capacity ahead of the 2030 World Cup).
Surprisingly, Valencia’s website doesn’t include many main points about the precise plan. There are some “simulated” images, but little fanfare or pride coming from other clubs that are redesigning their stadiums, such as Real Madrid, Barcelona, Real Betis. or Seville. ” If it was going to be so wonderful, they’d have to tell everybody,” says one Che supporter. “But that’s not the case. “
The hope of the wider Valencian network is that ultimately the finishing touch of the new stadium will free the team towards a better future. But those who have learned to distrust the club’s hierarchy and local government wonder if the final charge won’t be an additional burden on the club, which is already hugely in debt.
The Athletic has heard both arguments in conversations with local experts over the past few weeks. But the truth is that Valencia fans have been waiting for their new stadium to be completed for almost two decades, and no one really knows when it will take place or what it will mean for the future of the club.
(Top photo: Jeroen Meuwsen/Socrates/Getty Images)