Future Stadiums & Venues

Report: Barcelona exploring bond finance model for Espai Barça

Spanish soccer giants hoping to raise as much as €600m for development project.

by Tom Bassam

Report: Barcelona exploring bond finance model for Espai Barça

Spanish soccer giants Barcelona are exploring an alternative finance model for their Espai Barça development, according to Spanish outlet Palco23.

Club president, Josep Maria Bartomeu, recently revealed the costs of the project, which involves the redevelopment of the club’s historic Nou Camp stadium, has climbed from €600 million (US$658.5 million) to €685 million (US$751.8 million).

Now the Spanish industry publication reports that club members will soon be called to an extraordinary assembly, where a bond model will be presented for up to €600 million so that the Espai Barça project will not impact the club’s balance sheet.

According to the report, an investment vehicle will be created that issues the debt between institutional investors, who are assured of the recovery of the money borrowed, with their respective interests, through the club’s income.

The move is apparently designed to shield the club’s income from the Nou Camp development, so that all the surplus is transferred to the vehicle issuing the bonds with the objective being that in 20 years these commitments have been liquidated, in line with standard maturities associated with this type of infrastructure project.

Barça are plotting a formula, according to Palco23, that involves transferring the debt linked to the Nou Camp to a company with a guaranteed future income, with that precise figure still to be defined.

Enrique Tombas, Barcelona’s treasurer of the board of directors, told Palco23 that the plan is to "draw a financing structure that is respectful of the two conditions of 2014: that there is no mortgage or pledge or use of pre-existing income,” and "the structure will not affect the balance of the club".

The latest development comes after a report from El Confidencial back in July that Barcelona hired investment group, JB Capital Markets, on a consultancy basis, to aid the club’s funding pursuit the Nou Camp revamp project.

On the pitch, Barca are fifth in La Liga after four games, and travel to play Granada in their next fixture on 21st September.