Leeds 'have committed' to £100m plan that could go 'spectacularly wrong' - Kieran Maguire

Leeds United may have been relegated at the end of 2022-23, but the club is in a far better place than when it last tumbled through the divisions.

Even with their failure the win promotion at the final hurdle in 2023-24, Leeds are still backed by ambitious owners and have one of the country’s biggest and most passionate fanbases.

Now, Red Bull’s minority investment in Leeds represents another major endorsement for the club who, if the right levers are pulled, are a sleeping giant of European football.

Their commercial income is the envy of the Championship, as well as more than half of the Premier League.

Their matchday income is also strong, and it is set to get even more so when the club ultimately press on with plans to expand Elland Road.

As the most watched club in the second tier, they will also likely get the biggest chunk of media income from the EFL.

All of this points in direction of promotion, if Daniel Farke and his playing squad can deliver on the pitch.

To get the lowdown on Leeds‘ financial picture and the impact it will have going forward, TBR spoke exclusively to Liverpool University football finance lecturer and Price of Football author Kieran Maguire.

Leeds have the Championship’s biggest front-of-shirt deal, with transfer benefits

Some fans were up in arms when Leeds’ new home kit leaked, replete with Red Bull logo front and centre – an issue caused associations by the colour red’s associations with arch rivals Man United.

However, supporters will surely be happy with the virtually unprecedented financial boost for a second-tier club that the deal has delivered.

In terms of the EFL’s Profit and Sustainability Rules, this gives Leeds a natural edge.

“They have by far the biggest front-of-shirt deal in the Championship.

“Even in the Championship, Leeds will have more commercial income than half the clubs in the Premier League.

“When they were last in the Championship, they were still generating £30m in commercial income.

“That increased to £50m in the Premier League. That reflects the size of the club.

“It will decrease, but that will be the biggest selling away shirt in the Championship by far.

“It gives them a natural head start.

“They lost £70m in their last two seasons in the Premier League, and that was after some pretty big player sales, so they didn’t have very good cost control.

“Wages and amortisation in their last season in the Premier League was 120 per cent of income.

“I think that shows you why they need to have high commercial income.“

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Elland Road expansion

Elland Road currently seats just under 38,000 spectators, but the club have grand plans to increase that to beyond 50,000.

There have been various twists and turns in the blueprints to upgrade the stadium, with several plans shelved or significantly revised.

But the club signalled their commitment to the expansion when they bought the land that the stadium sits on back from former owner Andrea Radrizzani earlier this month.

A 50,000-seater stadium would cost around £100m in construction costs but deliver matchday income well north of £40m per season.

What’s more, Leeds latest boardroom appointments – Andrew Schwartzberg and Eugene Schneur – both have property development backgrounds.

Maguire says these appointments should help insulate the club against the risk associated with revitalising the famous old stadium.

“Leeds have been hamstrung due to historic ownership issues.

“Those have been particularly prominent when it comes to the stadium. They are now only just extricating themselves from that challenge.

“It does make sense that, if you are going to rebuild or expand, you need to have people with knowledge of the property market.

“You need to know what is acceptable, what will and won’t work. They have committed to it, but if it goes wrong, it goes spectacularly wrong. So you need to have the right approach.“

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‘Super Away’ fan controversy

While the mood may be broadly positive in the boardroom at Leeds, the recent controversy involving the club’s ‘super away fans’ has caused disquiet among supporters.

Essentially, Leeds most loyal away fans are being asked to form out several hundred pounds to ensure that they get a guaranteed to every match on the road next season.

Maguire offered his views on the situation: “This affects around 250 fans. It is an interesting one. You have to go and find another £860 on top of your regular season ticket.

“The club aren’t making a lot of money out of it and it has split the fanbase.

“I think you can get a funding operation for it, but I think you have to pay interest on that. Many clubs have now signed up with finance companies that allow you to buy your season ticket over time, but it is costing quite a bit in interest.

“Some fans of Leeds are a bit grumpy because, in their opinion, the system is being exploited by these super fans who don’t go to all the matches and sell half a dozen tickets throughout the course of the season at premium prices.

“It’s not a big final earner. I think the club wanted to be seen as doing a good thing. It hasn’t been written or handled well.”