Paying a high price for progress

The conventional wisdom regarding the construction of new sports stadiums is that they are ventures which you only embark upon if have either a) a ton of public money which nobody expects ever to see recouped, b) a very solid anchor tenant - the likes of Manchester United or Celtic are preferable or c) a combination of the two. As it stands the FAI have none of the above.

In terms of Government expenditure, the association here may end up receiving a quarter of the £65 million (£16.125 million) that the project is budgeted to cost, although this is by no means certain. In international terms that sort of figure is small beer.

Even in the land of free enterprise, the United States, an estimated £7 billion of public money has been spent on providing new football stadiums and ball parks over the past nine years. On this side of the Atlantic, the £300 million spent on the Stade de France, and underwritten by the French government, for last summer's World Cup shows what a top-of-the-range facility now costs and a similar figure is estimated as being the cost for the proposed redevelopment of Wembley stadium in England.

Neither stadium will have an anchor tenant, Paris because the only club capable of playing there is already being subsidised to play at the Parc des Princes and Wembley because the English Sports Council, who are putting up two-thirds of the cost of the work, do not allow such arrangements under their rules. The upshot is that, in each case, the taxpayer will pay the vast majority of the money involved.

The developers of the FAI's stadium, HBG, specialise in somewhat smaller stadiums than the French and English grounds. In recent years they have refurbished several first division football grounds in Holland, built Vitesse's Gelredome in Arnhem and, most recently, they have been contracted to build Schalke 04 a new stadium at Gelsenkirchen in Germany. The latter two both bear close comparison to the facility being planned for Dublin.

Schalke's ground which will seat around 60,000 and will cost about £110 million to construct, while the more modest development at Arnhem, the first stadium in the world to feature the retractable roof and moveable pitch, has a capacity of just under 27,000 and cost £46.5 million to build.

This works out at more than £1,500 per seat, a figure comfortably beaten by some of the new developments across the water, but only at grounds which lack the sort of capacity for generating alternative sources of revenue which Arnhem, Gelsenkirchen and Dublin are intended to have. At Arnhem the cost of the roof and rolling pitch, a grass surface on an 11,000 tonne concrete slab which can be slipped under one of the stands and out into the open air when not in use, was said to be around £6 million. The two started paying for themselves soon after the stadium was officially opened, however, with the Gelredome being converted into an indoor venue for two sell-out Spice Girls concerts a matter of hours after Vitesse's first game there last March. The owners are budgeting for 25 such non-football events every year. But that is on top of the 20 odd domestic league and cup games which Vitesse are guaranteed and to which the club routinely attracts crowds of between 20,000 and its 27,000 capacity.

European games, of course, provide additional opportunities to generate revenue.

The target of 25 outside events may not sound all that ambitious but the operators of the Stade de France expect to stage less than 20 major events of any type this year, while the average at Wembley in recent years, and including football games, has been 29. Arnhem also face little competition in what they consider to be their catchment area. In the Dublin area last year there were just half-a-dozen major stadium concerts but Croke Park, Lansdowne Road, and the RDS were all there doing battle for the main international acts.

The FAI's new venue will undoubtedly be superior to any of its rivals and it may well, by allowing for the use of specific sections of the ground for smaller concerts, be able to compete with the Point Depot for acts which attract much smaller crowds.

But the association would still appear to face an uphill battle to attract major events with the sort of regularity required. Even if it sees off all of the competition, it is not clear that there is sufficient income out there to compensate for the fact that the Irish team will play no more than six games a year. During their last financial year the FAI hosted just four international matches at Lansdowne Road with total receipts totalling around £3.2 million. Of that, around £800,000 will have gone to the IRFU in rent for the ground. In effect, if they play five games per year, their own contribution to the repayments would be the £1 million or so per annum that they would be saving.

Being able to exploit the stadium's commercial potential (even naming the stadium after a product could bring in several million pounds) will boost that figure, of course, and it is intended that corporate sales will bring in substantial advance revenues. The FAI's product does not, however, have the guaranteed appeal to the corporate sector that the GAA or IRFU's packages do and the last time they attempted a 10-year ticket scheme it attracted just 1,600 buyers. With such a wonderful facility on offer the take-up would undoubtedly be better, but for an organisation with an annual turnover of around £5 million the numbers, like the projected stadium itself, are nothing short of dazzling.