by sussexpob » Fri Sep 01, 2017 5:57 pm
As for the government bail out, again its not an easy answer, but personally I think the whole deal stunk.
In order to understand the nature of it, you first have to consider the fact that a lot of European clubs are not only football clubs, they are sporting and social clubs that have many entities. The biggest examples are Barcelona and Real, basketball is a huge deal in Spain and these clubs own and run hugely popular basketball wings too, as well as other sports like hockey, swimming, athletics. Its common in Spain, and also Eastern Europe a lot.
Real used to own a complex in the city that was given to them by the local council decades ago. This was on the basis that the land used to build the complex was used for such sporting purposes, so the football team train there, but also the basketball team play there, 40,000 people swim there a day, there are gyms for public use, there are open public parks for people to walk through etc. The whole complex is seen as being part of the community, and represents the whole sporting output of the city in all strands of sport. However, the land is strictly designated for non-profit, to stop the club receiving it and then simply shafting the public.
By the turn of the millennium the club was in crappy financial position, the training ground had been swallowed by the urban sprawl of the capital, and the area had become a huge financial and commercial district with land hugely sought after. The council, pressured by the club who were desperate to sell for the cash, had a vote to rezone the land so that it could be used for commercial reasons in the future. This motion passed, with the club giving the council a portion of the land as part of the deal.
The land was sold, and it made Madrid eye watering cash amounts. Something like an estimated 700-800 million. Ironically, the Madrid president owned construction companies that contracted the building of a series of skyscrapers on the land too. As part of the deal to give the council part of the land, the council substituted that land for fresh stuff to build a new training and sporting complex outside the city.
As part of the deal, the council rated the land at something peasly, like 500,000EURs despite Real building the worlds biggest sporting complex within it. Subsequent valuations had rated it in multiple excess of it, millions of euros. The EU courts ended up forcing Real to pay money on the under valuation of the land, but it was like 10 million EURs, it didnt come close to the actual value. So essentially, since the 60s the council have given madrid the best part of a billion Euros in land and saleable assets.
The deal is untouchable though as the sporting complex being for the public still maintains the fact the council were working in the interest of the public
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And a hat and bra to you too, my good sirs!