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The Mail Bag

Stadium Costs

Comments (35)

It has recently been announced the cost of the new Olympic Stadium in London has risen from £280m to £525m in three years.

The rise in price has been blamed on oil costs, construction costs, raw materials and the credit crunch. We may find moving and redevlopment of GP out of our hands financially until we find new investors. Frightening scenario for all concerned. Does anyone know any Russian billionaires?
Kevin  Tully, Liverpool     Posted 18/06/2008 at 21:46:29

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Dave Wilson
1   Posted 19/06/2008 at 06:20:00

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In the current economic climate, I can only think of one thing more ridiculous than a poor club trying to rush through plans to build a new stadium,
That would be for said poor club, to build a sub standard one, in a location where a very large percentage of their customers dont want go

Mind you, nobody would be stupid enough to do that . . . . .would they ?
Neil Lavender
2   Posted 19/06/2008 at 08:12:09

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I?ve totally lost track of how much Everton are supposed to find towards the Knowsley Metro Stadium. As far as I am aware, Wyness has never amended his original £10M estimate although ?experts? on this site have recently taken to mentioning £78M as a firm fact. Is it not about time the club came clean on the revised 2010 projection?
Paul OHanlon
3   Posted 19/06/2008 at 08:23:33

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The ’experts’ on this site Neil are simoly quoting the figures publishing in the Echo. See for yourself (and remember, these costs were calculated last August)...
Alan Instone
4   Posted 19/06/2008 at 08:37:39

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Just picked up on Neil?s piece above in which he refers to DK as the Knowsley Met Stadium. As a KMC taxpayer, I have to say that if the Council has agreed to sponsor the project it?s an excellent way to publicise our area to a world audience. Up to now, the only thing anyone knows about Knowsley is that we have a Safari Park!
Chris Briddon
5   Posted 19/06/2008 at 09:27:43

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Alan - you are forgetting the fact that its home of QVC - The Shopping Channel - as advertised on the M62!
Carl Wright
6   Posted 19/06/2008 at 10:59:30

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Dont forget Huyton!! Knowsley is were is all gonna happen!! Tesco, Sarfari park and a bustling, trendy, tourist atrtraction town/city/village like Huyton and Kirkby.

What more do you need!?
Gavin Ramejkis
7   Posted 19/06/2008 at 11:48:29

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Oh yes "two dogs fighting" the hometown of thug Barton and his murdering relative, why not add Stockbridge Village (Cantril Farm) and other overspill towns that time forgot.
John Gee
8   Posted 19/06/2008 at 12:23:24

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The price of the Olympic Stadium hasn?t finished rising yet. It will keep going up just like Wembley did.
This is a big construction, with public money being paid into the bank accounts of wealthy construction magnates. Rising oil prices and all the other reasons that will be thrown at us are the smokescreen that masks the fact that a few well chosen "friends" of the country will make billions from building the olympic site. That money has to go somewhere.

Although I?m not a fan of a new stadium in kirkby, the costs wouldn?t be allowed to spiral upwards like that because it?s more of a private venture.

That said, with this induced credit crunch (Barclays quietly announced record profits this week), this is not the time to borrow money, be indebted to Tesco, sell Goodison at a knock down price and risk the future of the club. We?re making strides forward as a team, let's concentrate on that. After all, it?s what matters on the pitch. It?s called FOOTBALL not FOOTBUSINESS.
Barry Scott
9   Posted 19/06/2008 at 12:49:06

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Alan Instone - The naming rights havn’t been sold yet but Knowsley Council do want to brand Knowsley as the home of Everton FC so it may happen if the move goes ahead:

Some further information can be found in this document:
Carl Wright
10   Posted 19/06/2008 at 12:59:47

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Sorry but do I fuck want to play at the "Knowsley Council Stadium". It hardly conjures up images of free flowing football and success.

I can see the t-shirts now "my mates went to the Knowsley Council Stadium and all they got me was this shit t-shirt"
Tony Williams
11   Posted 19/06/2008 at 13:40:51

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Well said Gavin I see where you are going with this, pehaps Walton was the reason we got the Capital of Culture moniker, I mean the hoodies hanging around under the Queen’s Drive flyover are classy as fook!!
Gavin Ramejkis
12   Posted 19/06/2008 at 14:22:25

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Jimmy you gobshite the only parts of Knowsley that has had any money spent on it for the best part of forty years are the affluent parts, they even had to change the name of Cantril Farm it’s that much of a shithole, suddenly Kirkby has a sniff of money and it transforms from a forgotten overspill town with little to nothing going for it to the most suitable site for Tesco to solve the massive unemployment by running the majority of local businesses into the ground and giving the displaced and unemployed "careers" stacking shelves, pushing trolleys and swiping bar codes and Everton FC one of the founding members of the Football league. Tony at least the hoodies in Walton have somewhere to park and routes in and out of the place.
Carl Wright
13   Posted 19/06/2008 at 14:54:06

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Sounds harsh but Gavin has a point. ....

"Welcome to Knowsley, the home of Everton FC, QVC and the highest rate of teenage pregnancy in the UK"

Tony Williams
14   Posted 19/06/2008 at 15:07:16

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"Sounds harsh but Gavin has a point. ....

"Welcome to Knowsley, the home of Everton FC, QVC and the highest rate of teenage pregnancy in the UK""

Get in there, just imagine all those baby Blues popping out all over the show, there’s your future fans of the next generation for you!!
John Hughes
15   Posted 19/06/2008 at 14:07:15

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John Gee - Does the economic value of oil, steel & workforce not apply to building the Kirkby stadium because it’s private money? The simple fact is that it?s not that it won?t be allowed to happen but that it will happen regardless of wanting it to or not.

If I am right this is what happens??

When you buy Oil or Steel on a contract basis there is a price variance clause added to the contract. (NO supplier in their right mind would do it any other way) You agree a base price (based on estimated usage and current commodity price) and then any variance in cost up or down is added or subtracted from the base price (for steel if you agree a price of £100 per tonne then and the price increase by 6% your price becomes £106 but if it goes up another 6% then this is 6% of £106 not £100) doesn?t sound much in this example but multiply the price by 10 and the multiply the tonnage required by the thousands required and you can see what as little a 6% can do.
You can have a look on the LME (for steel) if you like and there’s only one way oil and steel are going and it’s not down. Building a new stadium in this climate is risky as costs cannot be firmly established and only go up. Same goes for a redevelopment but with a redevelopment you have greater control based on the fact you don’t need to build a whole stadium whilst maintaining the one you already have. Just because public money will be eating a hole in some ones pocket doesn’t mean it’s not going to affect us.
Plus for commodities such as steel and oil as we are seeing demand actually pushes the prices up not drives the prices down.

I haven’t even touched on the interest rates that the banks will apply to any loan or any caveats they will want to add to help them protect their investment.

Christ, in summary regardless of what the cost are for the Olympic stadium the prices we pay for the stadium do depend on market forces and any contracts agreed by the construction company and their supplier for the material to build the stadium. The Kirkby stadium therefore could double in costs very quickly. So if its gone from an estimated £35m to a now quoted £78m there is every chance in 6months this being £130m+ easily. Hopefully this would render it dead and we’d escape a life less ordinary in Kirkby.
Now back to work and the basics of commodity buying are lost forever. Just waiting for someone to correct me now??? Any construction buyers out there who can verify this?
Carl Wright
16   Posted 19/06/2008 at 15:27:08

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Haha fairplay Tony. If we can't laugh and joke about this mess we?d probably cry...
John Hughes
17   Posted 19/06/2008 at 15:29:27

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Tony W - you're forgetting lambrini......the champagne of Merseyside.
Tony Williams
18   Posted 19/06/2008 at 15:33:32

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Lambrini.....Lambrini!!!!, God you don’t know you’re born. What I wouldn’t give for a classy beverage like Lambrini, whilst I settle for the classless Blue Nun, Black Tower and the crowds favourite MD 20/20.......hic!
Kevin Tully
19   Posted 19/06/2008 at 15:43:21

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John Hughes,
Some of my suppliers will only supply quotations which are valid for 14 days. Obviously you can tie suppliers down the larger orders you have to place with them.
I have been informed today that our steel costs are due to rise for at least the next six months and next month is by a minimum of 4%. With demand still outstripping supply in the Far East, China are actually purchasing the copper, iron,mineral etc resources of other Countries in return for building their infrastructure .This is already happening in Africa and Bolivia.
Chris Roberts
20   Posted 19/06/2008 at 16:41:18

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"The Kirkby stadium therefore could double in costs very quickly. So if its gone from an estimated £35m to a now quoted £78m there is every chance in 6months this being £130m+ easily."

That?s just speculative rubbish. Why do you bother writing it? I?d agree like if Kate Hoey was in charge but really what utter utter rubbish based on nothing more than your enjoyment of big numbers.

Carl Wright
21   Posted 19/06/2008 at 16:45:03

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The business we?re in are having the same issues. As soon as we leave Asia the prices we have agreed there go up. The cost price of raw materials (steel/oil) has gone through the roof. Only conselation is that everyone is in the same boat.

Which means if our stadium is incresaing by 50%, the redsite arena will be. And will hopefully bankrupt the bastards
Carl Wright
22   Posted 19/06/2008 at 16:49:24

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Chris, the numbers maybe speculative, but the theory behind it is 100%. Read a paper; inflation, higher petrol prices etc. They all contribute to increases put on to vendors.

I'd put money on the money needed by Everton going up at least £20-30m in the next 6 months.
Neil Pearse
23   Posted 19/06/2008 at 16:55:19

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In all your enthusiasm to use this as one more way to bash Kirkby, I think one of the major points of Kevin’s original posting has been lost lost. As he says - if construction costs are going through the roof, this means that we cannot afford to move or to redevelop GP. In fact it really means - we cannot afford to do anything at all.

I am glad that you all see this as such a great cause of celebration!
Chad Schofield
24   Posted 19/06/2008 at 18:23:43

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There would be no celebration Neil, but I can’t say that I’d be disappointed if this whole Kirkby plan folded and was never spoken of again.

Chris Roberts... seriously, do you live in a news blackout? Whilst for the past four years people have been predicting a house price crash, global recession, etc, etc, it could well be a blip, and there will be those speculating on that, but then that often happens before things go really tits up. Personally I’d rather not be putting myself into a position of unnecessary risk and in the next 6-18 months refrain from jumping on too many ?wonderful opportunities" until it really has settled down.

Again, I may be risk adverse, but if I were buying a house at this very moment I would either be trying to drive down the price considerably or pulling out and cutting my losses.
If I were about to fork out £80M in borrowed money (highly likely variable rate) in the hope that I could increase revenue, with a grave potential of the money for what is a luxury item, in terms of it being ?entertainment?? well, you probably get the point.
Dave Wilson
25   Posted 19/06/2008 at 19:01:06

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Neil Pierce

your right we cant afford to do anything at all - at the moment - so why are you such a strong advocate of Kirkby ?
It will be the finish of us
George Tranter
26   Posted 19/06/2008 at 19:30:49

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That’s rubbish,Dave. If Knowsley come up with the full £60M for naming rights,surely BB can raise a paltry £18M.?
Dave Wilson
27   Posted 19/06/2008 at 19:38:03

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Which reminds me, where are all the yes men who were claiming we?d around £30 million naming rights?
I say we wont get 30 quid!

Stupid figure?
Well you guys started it and lets face it, I?ll be closer.
Chad Schofield
28   Posted 19/06/2008 at 19:53:37

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Perhaps plan B is to spend £76,275,360 on Euro Millions tickets once there’s a suitably sized jackpot.

Alternatively, BK and KW could start doing impromptu carwashes... failing that they could always get Patches O’Hollahan on the board.
Karl Masters
29   Posted 19/06/2008 at 20:38:39

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Ha Ha... Wyness and BK opening and working in a topless Car wash!!!

Man-boobs on your windscreen, luv?

Another business for KW to run alongside his job as CEO of Everton....
John Gee
30   Posted 19/06/2008 at 22:13:07

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John Hughes,

as I alluded to, the price of the Olympic Stadium will spiral upwards because politicians don?t care about somebody else?s money. The Kirkby Stadium is a private venture and the company in charge, who happen to have the highest turnover in Europe of any company, own the biggest building in Europe, and are increasing their property portfolio at an almost exponential rate, will be calling the shots. What?s happening with the Olympic Stadium would never be allowed to happen with a private company. Especially a company of the size Tesco.

The word "commodity" always sets my bullshit-o-meter ringing because that means it?s about trading. Building something isn?t trading, it?s BUILDING something. The trade doesn?t come into that. You order what you need before construction begins.

Or.. let me put it another way...

Tax payers money is being diverted from people?s paychecks into the bank accounts of the wealthy owners/magnates by fake free market economics.

Maybe you would want me to quote all the details that, convieniently, obscure the big picture. You?re obviosly intelligent and probably well educated so it should be no problem for you to join up the dots.

We?re being screwed, and our KW friends are inextricably linked to that.

One more thing, guys; don?t be snobby about Kirkby or the rest of Knowsley. Kirkdale, Walton, Everton, Anfield, Toxteth, The Vale... They?re shitholes and no amount of city-of-pop-culture is going to change that. Let's be honest and stop looking down your noses at places you don?t know. Or should I compare where I live (the West End, London) to the dodgy, shitty, boring, lifeless no mark places you live. There?s always a bigger fish... for all of us.

Roy Coyne
31   Posted 19/06/2008 at 22:45:35

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OK we are better off not moving to Kirkby because of the inflation (to be honest I would take any excuse to scrap it) and we cannot afford to do up Goodison so why not just sit tight at Goodison and wait for the inflation to take the reds in to liquidation and pick up a new stadium for ten pence in the pound off the receiver?
Chad Schofield
32   Posted 20/06/2008 at 09:22:15

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Well John G, I’d hazard a guess you’re not in the building trade... and who;s to say that people don’t know the area?

Personally I do not know Kirkby, but I am not passing judgement of the area, just on the project which frankly stinks. Neither am I a builder, but I am not naive in thinking that because this is a private build that our board will handle it in any better way than they have so far. When you consider this was going to cost "practically nothing" to it then being £78M. The fact that each plus point, other than the stadium will be new, has turned out to either be false or guessed at. Sorry but I just don;t see how the "deal of the century" is going to improove our position at all, and given the current economic climate it could be far more disasterous a mess than it is already.
Tom Hughes
33   Posted 20/06/2008 at 09:58:50

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"The Kirkby Stadium is a private venture and the company in charge, who happen to have the highest turnover in Europe of any company, own the biggest building in Europe, and are increasing their property portfolio at an almost exponential rate, will be calling the shots. What?s happening with the Olympic Stadium would never be allowed to happen with a private company. Especially a company of the size Tesco."

Aren’t Tesco a plc? Despite their vast wealth EFC are still expected to fund approx 3/4 of the construction costs so I’m not sure what Tesco’s wealth has to do with the price of fish. Arsenal with only very modest means in comparison to Tesco have built a mega stadium of high quality. Fact is this whole process is one of Tesco making their solution fit our problem.... I don’t think it ever can.
Christine Foster
34   Posted 20/06/2008 at 11:04:35

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The financial underwriting of KBC costs by Everton FC should they go to Kirkby WILL escalate. The cost of credit, interest rates, are increasing and are likely to do so for the next financial year and beyond.

Its common sense (yet again) that will dictate that costs will increase over and above the expect (stated) £78m contribution. Indeed even with out the factors of the general economy the stadium cost will be higher due to the averaging of the clubs contribution due to the smaller retail footprint. Exactly how much has not been disclosed (and I doubt it will until the deal is done)

I am not sure but I cannot recall ANY stadium built on time and within expected budget in the UK in the last decade. Thats a good indicator for realistic expectations

A last point to Neil P. Re celebrating the fact we can’t afford anything. We can, over a period of time in a planned approach that enables us to minimise debt and impact on the team. Its called the redevelopment of GP.

The Wade report showed a fully costed stadium developed over a period of time that would not cripple us nor sell our identity for a Tesco Gift voucher.

It can be done. It should be on the table .
John Gee
35   Posted 20/06/2008 at 12:25:45

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Obviously I don?t know for sure but I?d be surprised if tesco didn?t control the construction through a third party. So the budget would for the total build wouldn?t run over too much. Although I can?t remember a single site I?ve been on where the job was delivered on time and on budget. (I did work in the building industry- the hands dirty side- for a while)

If we were getting an emirates of the north, I?d go for that but we all know we?re more likely to get a shed with some blue lights outside.

KW and blue bill, if you read this don?t let everton play in an embarrasment and BUY PODOLSKI.

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