Manchester City will pay Manchester council an additional £320,000 a year for its lease at the Etihad Campus under an updated agreement, new figures have revealed.
Town hall papers published in August detailed a variation to the lease in response to changes at the stadium and surrounding land, which has become a major visitor destination since the ground first opened for the 2002 Commonwealth Games.
Breakdown of the extra payments
The council will receive an extra £33,000 a year for the stadium lease, £252,000 for City Square, and £35,680 from land in the new Medlock Square hotel and entertainment zone.
These additions will increase the total paid by the club to the council, which stood at £6.3m last year. That figure was made up of £4.4m in rent, £1.1m from naming rights, and £790,000 from income from Champions League games.
Lease payments for the stadium and City Square are set to rise in future through inflation-linked increases, while the land lease at Medlock Square includes an annual rent uplift of three per cent and future reviews.
Council leader welcomes income
Manchester council leader Garry Bridges said: "It shouldn't be understated what a brilliant income this is for the city and a stream of funding that most councils in this country dream of."
He added: "This is more than £6m every year that is pumped into sport and leisure investment and activities across the city that otherwise wouldn't exist - and will increase every year into the future. The impact of this for our communities is incredible."
Bridges also said: "We have a responsibility to make sure we deliver for our residents. This was a great deal for the city and continues to be a great deal for the people of Manchester."
Long-term lease background
Manchester council paid £33m towards the £110m initial construction cost of the Etihad Stadium, previously known as the City of Manchester Stadium. City's lease at the ground began in August 2003 for a period of 250 years.
Since the lease was signed, rent paid to the council has grown through negotiated agreements with the club.
A Manchester council spokesperson said: "As freeholders of the Etihad Campus, the council has always sought independent third-party advice that makes sure we can negotiate the best deal in terms of rental income for the land - and on top of this, the council has also negotiated further uplift through naming rights and income linked to any potential European games."
The spokesperson added: "Following the club's substantial investment in the campus, which would generate a further income for them, the council has since concluded negotiations for variations to the lease that means the council can benefit from further income each year - along with an annual increase of 3pc."
They continued: "This represents a substantial and recurring return on the council's original investment in the stadium for the 2002 Commonwealth Games, which has created an annual return of more than £6m. This income will grow each following year and reflects the significant long-term value secured for the city."
Income through the agreement is jointly managed with Sport England and is ring-fenced for reinvestment into sport and leisure activities across Manchester. Manchester City was approached for comment.
