Germany: Can Stuttgart afford Euro 2024 redevelopment?

source: Echo24.de

Germany: Can Stuttgart afford Euro 2024 redevelopment? The condition was simple: VfB had to ascend back to the Bundesliga in order to secure funding for itself and the city. But despite having won promotion, neither the club, nor the city, nor the stadium operator have the funds. Why? COVID-19.

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Last year's estimates, which may already be outdated, indicate that a thorough revamp of Mercedes-Benz Arena ahead of Euro 2024 would cost €65 million (currently $73m). Bulk of work would be carried out within the main stand, which would receive entirely new players' facilities, media working areas and expanded hospitality to generate greater revenue.

According to the plan, the price tag would be split nearly equally between three crucial stakeholders. VfB Stuttgart and the stadium operating company Stadion NeckarPark GmbH would contribute €22.5 million each, while the city of Stuttgart would cover the remainder, €20 million.

The major condition necessary to make the operation feasible was VfB's return to the Bundesliga. This way the club would have far greater revenue and would thus be able to pay normal rent for stadium use (rather than halved fees in 2. Bundesliga), which would recoup the city's part of the equation.

Mercedes-Benz Stadium© hnns_schtt

The plan had a solid logic behind it until COVID-19 came to Europe and hit Germany. Today, despite managing to win back a place in the country's top flight, VfB aren't in a financial condition to put forward €22.5 million.

The club hasn't revealed full extent of its losses but the deficit is understood to be in 8 digits. The city, which saw tax revenue fall and unexpected expenses arise, also has to re-evaluate public spending. Finally, the stadium that used to host events in the hundreds is now standing empty and largely unused, which means no revenue that would help repay the €22.5 million loan that was to be taken.

Further decisions are expected in the city soon, perhaps within days. What seems certain is that the operation will depend on how long it will take to get back to normal. At present it seems fans will return in a limited number from the 2020/21 season onwards, however the situation is very fluent as we're seeing further countries locking down again.

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