Tottenham would struggle 'immensely' to construct their stadium for $1.5bn (£1.2bn/€1.4bn) in today's market - a stark indicator of the escalating construction costs Newcastle United could encounter with any potential revamp of St James' Park.
This insight comes from Jonathan Turner, a non-executive director at Spurs, following the club's initial $320m (£250m/€260m) stadium design and plan that ultimately cost nearly five times that amount. The outcome?
Spurs now proudly own the Premier League's second largest stadium, almost double the capacity of the former White Hart Lane, and they've certainly capitalized on it. In fact, during the 2022/23 season, Spurs raked in $150 (£118/€140) in match income.
It's worth noting that the cheapest adult season ticket at Spurs has since skyrocketed to a staggering $Xm (£856/€Xm), but the club does provide some of the top-tier stadium facilities in the country, boasting Europe's longest bar and an in-house microbrewery.
Moreover, Spurs have transformed the stadium into a versatile venue: Beyonce's five-night stint last summer set the record for the highest-grossing concert ever hosted by a female artist at the time; the arena is the official UK home of the NFL and features the world's first F1 branded electric karting experience; and the club is even constructing a 180-room hotel to bolster their conference and events business.
Turner highlighted the significance of Tottenham's stadium as a key asset in competing financially with wealthier clubs, describing it as one of Spurs' 'central pieces' in a PSR (Premier Sports Resources) context. He pointed out the challenge Newcastle faces, while CEO Darren Eales has emphasized the importance of being 'smart to try to grow our revenue streams'.
The Magpies are currently developing a new fan zone that will be open all week and have expressed a desire to remain at St James' Park. They've engaged top architects to explore possibilities for the complex city centre location.
Eales has made it clear that 'no conclusions' have been drawn yet, with the club's comprehensive stadium feasibility study expected to be finalized this summer.
It's widely acknowledged that expanding or rebuilding a stadium in the current economic environment would be an expensive endeavor. However, Newcastle's ownership has the financial capacity to potentially fund such a project.
In contrast, Spurs executive director Donna-Maria Cullen has admitted to undertaking their stadium project with 'limited finances'. Turner provided more insight into Tottenham's approach, stating: "The stadium was financed through internally generated cash flow and also through debt," during his conversation with the Business of Sport, adding that "The debt is on a very long-term basis."
"A lot of it is held by pension funds and other institutions who are comfortable holding long-term debt. The stadium was built in a low-interest rate environment. That may be lucky. We have a fixed rate on the vast majority of that. The service cost of the debt and the long-term nature of debt was an incredible financing package that would not be available today."
"It would be incredibly hard to build the stadium today for the cost that it was built....if you were going to do it today, construction costs are higher. Inflation is higher. The cost of interest is higher. It was pretty hard to do in the first place, but I think it would be a harder exercise."
Earlier, Amanda Staveley confessed that Newcastle absolutely needs to invest in refurbishing St James' to make it 'fit for purpose'. Assuring their support, Newcastle City Council has pledged to back the club as much as possible to ensure that the Magpies stay put in the future.