The pitch for growth: will football help regenerate England’s cities?
Clubs in several big cities want to use new stadiums to redevelop entire areas. But they seek government funding to make the projects work
On the afternoon that the Birmingham City team lifted the trophy for winning the third tier of English football last month, the co-owner Tom Wagner took to the pitch to address the crowd.
“I promise you this is not the best day that we will enjoy together,” said Wagner, a former Goldman Sachs trader. “This is not even f*cking close.”
The success means that Birmingham will play in the Championship next season, one level below the big money of the Premier League. But winning football matches is only part of the investment case for Wagner.
Since taking control of Birmingham City in 2023, Wagner’s hedge fund Knighthead Capital has bought up more than 60 acres of land around St Andrew’s stadium — the club’s home since 1906 and just a mile from the city centre.
In common with many other club owners, Wagner wants to build a new stadium that would double capacity to 60,000. But Knighthead’s proposals also include a £3bn investment in retail, commercial and residential space billed as a new sport and entertainment district — in an area that is one of the poorest in the country.
Wagner has been making his economic pitch to the government in the hope of securing backing for a £200mn-£300mn tram line extension between the city centre and St Andrew’s in June’s spending review.
The tram link — leading out to the city’s international airport — has been under discussion for several years. But Wagner, the city council and the region’s metro mayor all believe that the new infrastructure, combined with the stadium investment, could reinvent a whole area of the centre of the city. Wagner argues projects like this could help unleash foreign investment into the UK.
He is not alone in lobbying ministers. Clubs from other cities, including Manchester and Liverpool, are also pushing ambitious development plans that combine a new stadium with urban regeneration.
Many political leaders in English cities have come to see stadium-led projects as an economic opportunity — and are energetically lobbying the government for support to help launch them.
But ministers will need to decide whether it makes political or economic sense for large amounts of public money to support projects sponsored by the country’s biggest football clubs, many of which are owned by wealthy private investors and companies.
As clubs and mayors embark on PR blitzes to sell their visions, experts acknowledge that using sporting venues for urban development is a monumental task that can take decades.
“City regeneration is hard work however you do it,” says Jason Prior, chief executive of infrastructure consultancy Aecom’s buildings and places team, who worked on the long-term regeneration of the Eastlands district around what is now Manchester City’s Etihad stadium. “Sports is a way of doing it . . . but these are not overnight solutions.”
He adds: “You have to stick at it. When you’re turning round often quite deep-seated economic failure or really poorly served communities, these are 20-year plans.”
Based in New York, Knighthead is an investment firm that specialises in managing insurance-related assets, distressed credit and real estate finance.
The firm’s vision for Birmingham, the UK’s second-largest city, is a mixture of sport and real estate. “We’re creating a venue that draws visitors to the West Midlands to create economic activity on a regular basis,” Wagner tells the Financial Times.
“With the office and residential development components, we’re creating a hub of future economic activity that we think will last at least a decade or more, meaning that development will occur in and around that region.”
To expand the club’s global appeal, Knighthead also brought in former NFL star Tom Brady as an adviser and minority shareholder at Birmingham City.
The football stadium is the linchpin. Clubs are building new stadiums or refurbishing existing homes to target fans with the money to splash on high-end hospitality. They are also competing to host the world’s most famous singers and bands to squeeze additional revenue out of their infrastructure.
The money helps clubs to buy top players and pay their multimillion-pound salaries. But Wagner and the other wealthy owners buying into England’s favourite sport want to convince the government that new stadiums can also be the catalyst for broader urban regeneration and economic growth.
Clubs such as Birmingham City have increasingly become fixtures at property conferences at home and abroad, as they seek to drum up support from both public and private investors.
Wagner was among the keynote speakers at the UKREiiF property conference in Leeds this month. At this year’s Mipim festival in Cannes, the cities of Liverpool and Newcastle showcased the opportunities presented by their top-flight clubs, while Manchester United unveiled new stadium plans and claimed they could create 92,000 new jobs through associated regeneration.
Colin Chong, who recently oversaw Everton’s plans for the new stadium at Bramley-Moore Dock on the northern fringe of Liverpool city centre, was among those addressing investors in Cannes. He previously worked on the 2002 Commonwealth Games stadium in Manchester, which was subsequently taken over by Manchester City and which has helped to spearhead a wave of regeneration in the former industrial area around it.
Along with local leaders, he wants government support to help kick-start Everton’s regeneration plans along Liverpool’s famous waterfront, including new housing and entertainment space, to help revive one of the country’s poorest urban areas.
Everton is in negotiations with landowner Peel Land and Ports to acquire part of a site between the stadium and the city centre, which already has planning permission.
Chong argues that public money will be needed to redevelop it “without a doubt”. Land values and returns on investment are lower outside the South East, he says, meaning large regeneration schemes often require state support to make them stack up commercially.
“We need a third of financial support to come from government,” he says of Everton’s regeneration plans for the site. “Until we’ve got that commitment, things really aren’t that viable.”
Liverpool city region mayor Steve Rotheram says there is a case for expanding transport links to the area — but only if they will be used regularly by new residents, and not just by fans going to games.
“We haven’t got hundreds of millions to invest in public transport infrastructure when it’s going to be used for six hours every fortnight,” he says.
Liverpool’s political leaders are incorporating Everton’s proposals in their pitch to the government for housing investment across a swath of the city’s most deprived areas under Labour’s “new towns” programme. The party hopes to create 12 such new communities, some of which are likely to be extensions within existing cities.
Local politicians are also considering setting up an urban development corporation — a tool first used in the city in the 1980s, intended to fast-track planning — across part of that area.
Birmingham and Manchester are considering similar vehicles, headed up by metro mayors, to fast track their own football-led regeneration schemes.
Seventy miles away, the US owners of newly promoted Leeds United, 49ers Enterprises, are also planning significant work to add 20,000 additional seats to the team’s Elland Road stadium, which has a current capacity of just under 38,000. The Yorkshire club’s ownership group also includes Peter Lowy, part of the family that controls Australian real estate group Westfields.
Leeds chair Paraag Marathe tells the FT that the club has “acquired options” on several plots of land adjacent to the stadium with an eye to future development, but points to transport bottlenecks similar to those in Birmingham.
“There’s totally an opportunity to redevelop [the area] because as the crow flies, Elland Road is really close to the city centre,” he says. “[But] it’s complicated to get to — that’s why there’s been a two-decade long effort to get light rail out there. And so we’re still trying to fast track that as well. But there’s just so much opportunity.”
Cities outside London have long struggled to attract the public funding needed for such infrastructure. As a result, the prospects for many stadium-led regeneration projects will partly hinge on lobbying by metro mayors before the spending review.
While Liverpool is seeking support through the new towns programme, Greater Manchester’s mayor, Andy Burnham, wants infrastructure funding to capitalise on Manchester United’s proposed replacement of its Old Trafford ground. His counterpart in the West Midlands, Richard Parker, has pitched Birmingham City’s project as part of a wider economic proposition.
The West Midlands proposal argues that a series of economic opportunities in Birmingham — including the arrival of HS2 in the city centre and a new BBC headquarters, as well as the sports quarter promoted by Wagner — lack the necessary transport connections within the city.
In Parker’s words, linking the sports quarter with Birmingham’s other economic opportunities would help “break the cycle of being overlooked and underestimated”.
One of the most controversial proposals for stadium-led regeneration is in Manchester.
Sir Jim Ratcliffe, the Monaco-based billionaire co-owner of Manchester United, is making the case for building a “Wembley of the North” — referring to the £750mn national stadium in London that was built with private and public funding and boosted the local area through investment in roads, rail and routes for pedestrians.
Ratcliffe argues that a new 100,000-seat stadium can “be the catalyst for social and economic renewal of the Old Trafford area”. The project’s cheerleaders have requested more than £200mn in June’s spending review to unlock development around the stadium.
The funds would ostensibly pay to remove an adjacent freight terminal to open up space for the new stadium. Burnham has argued that moving the terminal would help address one of the north’s most acute rail bottlenecks, thereby representing an economic investment in the region that goes beyond any benefits to the club.
Burnham has previously expressed confidence that the money would be secured in the June spending review. However, three people familiar with discussions say the Treasury has been reticent to commit until the club’s own financing is made clear.
United, whose biggest voting shareholders are members of the US-based Glazer family, are not seeking government funds for the stadium itself, which could cost £2bn, but want support for development of the surrounding area. “If the government really gets behind this regeneration scheme . . . we will build it,” says Ratcliffe.
Speaking at the launch event, Lord Sebastian Coe, who led the task force exploring what to do about Old Trafford, compared the situation in west Manchester to that in east London before the 2012 summer Olympics. Coe chaired the organising committee for those games.
“We’ve created a landscape where we’ve built a new city inside an old city in seven years,” he said of the 520-hectare site in London that had not been used in decades. “Attached to that are homes, jobs, businesses, educational establishments and the largest retail development anywhere in Europe for 25 years.”
He added: “This project in Manchester, built around the reconstruction of a football stadium, has the potential to be bigger.”
However, the proposal has been met with scepticism among those who believe the plans have not been fully thought through, that the wider transport benefits have been exaggerated, or that the project could simply line the pockets of the club’s owners.
United “don’t own the land, they’ve not got a detailed stadium design, they haven’t got the funding”, says Chong at Everton. “From what I can see there’s no strategic plan for how they are going to achieve that.”
Others are even more forthright. “It is intolerable that public money, at a time of cuts in welfare spending, should be used to help a tax exile,” said Manchester MP and United supporter Graham Stringer, who was part of the original bid in the 1990s to bring the Commonwealth Games to the city.
Manchester United and Ineos declined to comment.
That event’s legacy stadium, five miles away from Old Trafford on the eastern side of the city, now houses rivals Manchester City — and has become a template for using a sporting venue as a springboard for the regeneration of one of the city’s poorest areas.
Construction work around that ground has been in progress for years. At present, the club is building a new 400-room hotel next door, alongside new retail and restaurant space.
It is the latest part of the club’s local investment, which began a few years after a member of Abu Dhabi’s ruling family bought the team in 2008. The area now houses City’s training centre, a stadium for its women’s team, and more recently the Co-op Live arena, a music venue co-owned by the club that can host 23,500 people.
Ultimately, local leaders and the club are planning for new development to spread from Eastlands two miles along the canal to the city centre, through a series of derelict and unregenerated areas.
Eastlands has since become “the poster child” for sports-led urban regeneration, according to Prior at Aecom.
But it was not straightforward, he points out. The next phase of the transformation between the stadium and the city centre must have been looked at by regeneration teams “every day for the last 25 years”, he says.
Such work requires careful sequencing to unlock each challenge in the right order. “It’s a constant process of reflection,” he says, “measuring what you’ve done, reviewing and keeping pace with the community and stepping in when things aren’t working — and not taking the easy route.”
He adds: “Manchester always stuck to its plan.”
Nonetheless, the partnership between the club’s owners and the city council has, at times, proved controversial. One housing joint venture between the local authority and Abu Dhabi United Group, Manchester Life, has been criticised for a lack of financial transparency — a claim which the council denies.
Abu Dhabi’s human rights record has been a source of contention for Manchester’s Labour-led council.
Paul Michael Brannagan, an expert on sport and politics at Manchester Metropolitan University, says that if clubs want to receive government funding, they need to present “these developments as essential to city planning”.
But he adds that the projects reflect the changing social role of large clubs and their stadiums. “They are no longer just places to watch football, but are now rather positioned as central features of contemporary urban planning.”