This article titled “Tottenham and Olympic organisers to go head-to-head over naming rights” was written by Owen Gibson, for The Guardian on Tuesday 20th December 2011 00.06 UTC
West Ham have been warned they are not guaranteed winners of the retendering process for the Olympic Stadium that will be launched on Tuesday, alongside a drive to find a buyer for the naming rights.
It has emerged that the Olympic Park Legacy Company wants to sell the naming rights to the stadium and the other venues on the park for which it is responsible, including the aquatics centre, shortly after the wide-ranging tender process for leases to the stadium begins.
Searching for a multi-year partner, an option open now that the stadium is staying in public hands, will take the OPLC head-to-head with Tottenham Hotspur, who will be looking for a sponsor for their redeveloped stadium over the same period.
It was the legal challenge by losing bidder Spurs, along with an anonymous complaint to the European Commission, that led the government and the OPLC to scrap the previous process after it became gripped by “legal paralysis”.
The OPLC chief executive, Andrew Altman, said that despite the widespread assumption that West Ham would become the main tenant in the stadium following the collapse of the previous process, they would have to table a competitive bid.
Determined to ensure that West Ham bid competitively in a process that will offer a range of operators an opportunity to tender for leases of between five and 99 years, Altman said the 60,000-capacity stadium could operate profitably without a major football club.
“We believe that there are other combinations. We welcome football but we’re not wholly dependent on football. There are other combinations and other sports, there’s concerts and other activities that can also provide revenues,” he said.
Altman said the plan to award contracts to a range of tenants would “provide maximum flexibility for the public sector” and deliver value for money. The OPLC is understood to have held preliminary conversations with two Premiership rugby clubs, the NFL and Essex County Cricket Club as well as concert operators and banqueting companies.
In contrast to the last bidding process, after which West Ham and Newham council were given “preferred bidder” status, the OPLC will this time seek to sign binding legal contracts with the selected tenants by May next year. It still hopes to reopen the stadium in 2014.
Duncan Innes, the OPLC’s executive director of real estate, said it would go to the market for naming rights early next year. “We are not dependent on a football tenant to make it work. An advantage we have is that we own the whole park, so if for example you look at naming rights we might be able to do a deal across all the venues in the park,” he said. “That would give us flexibility in how we go about generating revenue, which is a big difference from last time.”
He said the income from naming rights would be shared with the tenants. If West Ham were to become tenants in the stadium, they would take a cut. “We reserve the rights to naming rights. We recognise that a good sports-playing tenant will help contribute to the value of those rights, and it would be entirely right for a proportion of them to go across to the club,” said Innes.
The bids will be assessed under four main criteria: financial, deliverability, usage and legal certainty. The OPLC says the stadium can be run profitably without straining the public purse. Under the redrawn tender process, the OPLC and Newham council will find the £95m required to convert the 80,000-seat stadium into a permanent 60,000-capacity multi-use stadium. They will then award leases to operators, including sports clubs and concert promoters, willing to pay an annual rent with a revenue share element, before looking for a company to operate the stadium.
Under the deal UK Athletics, which recently won the right to stage the 2017 World Athletics Championships in the stadium, is guaranteed 20 days of use a year and Newham allocated around 30 days for community use.
The West Ham vice-chair, Karren Brady, has said the club, understood to be examining options for installing retractable seating to cover the running track during the football season, are keen to bid again. The mayor of London, Boris Johnson, said in the wake of the collapse of the initial process in October that the stadium would “almost certainly” go to West Ham. But the OPLC is determined to inject some competitiveness into the process.
The sports minister, Hugh Robertson, said the 2014 reopening date remained feasible. “The government is committed to securing a legacy from the Olympic Stadium and wants to see it reopening in 2014,” he said. “With the 2017 World Athletics Championships bid won athletics will be at the heart of a multi-purpose venue that will also be a great asset to the local community. The Olympic Stadium is an iconic venue and I am sure it will attract interesting and exciting bids.”
Johnson said the stadium would become “not only one of the world’s premier destinations for sports, hosting the World Athletics Championships, but also a first class hub for culture and entertainment”.
He said the tender process showed that the OPLC was still “far ahead” in planning for after the Games. Next month, the OPLC is expected to name the operators of the aquatics centre and the multi-use arena that will be used for handball during the Games, as well as contractors to run the Orbit visitor attraction and look after the upkeep of the park.
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