Darren Berman: Wembley National Stadium Limited
23 August 2004
25 February 2014
6 January 2014
6 July 2014
18 March 2014
19 March 2014
Fiasco or scandal, muses Darren Berman, head of legal and corporate affairs at Wembley National Stadium Limited (WNSL). Inevitably, it is one or other of the two words that has accompanied the word Wembley in the news over the past few years. Just two weeks ago, there was media uproar over a dispute between Wembley builder Multiplex and one of its suppliers.
Berman, who has yet to be directly involved in any of the disputes, shrugs off the Multiplex supplier issue. The construction giant has proven its ability to deliver world-class stadia across the globe.
This one happens to be the biggest, and, it claims, the best. It has bigger seats, more toilets and boxes, better disabled access and better viewing, plus a 133m arch that will dominate North London’s skyline in a way the old twin towers did only in the imagination. As a graduate of the Football Association’s (FA) legal department, Wembley’s sole lawyer has had tougher crises to manage.
After much to-ing and fro-ing at the tail end of 2001 between the Government, the FA and Sport England, it finally looked as though the Wembley rebuild would receive the green light. “We just needed to find the funding from one or more banks,” says Berman. Of course, £433m was quite a big “just”.
The FA had previously handled most of the legal work in-house but it was clear that the final stretch on a project of this size required a lawyer working on it full-time. Berman was seconded to WNSL “until further notice”.
His initial brief was to take the project to financial close but it was always understood that his skills would be required during construction. After that, there would be an operational business that would require a lawyer. Berman became a permanent WNSL employee in 2003.
The company was founded in 1997 as the English National Stadium Development Company. When the FA bought the old Wembley Stadium with a £120m Lottery grant in 1999, the structure changed and the new name came with it.
As far as the ordinary share capital is concerned, WNSL is wholly-owned by the FA. There is one golden share, owned by Sport England to protect its Lottery investment. WNSL has a normal parent-subsidiary relationship, but despite being a private company subsidiary of another private company, it is also a public-private project, which adds a degree of public accountability. The WNSL-FA relationship is subject to contracts with the Government, Sport England and the banks.
The structure and funding were established in 2002, involving armies of lawyers burning the midnight oil. Allen & Overy advised WNSL on finance, banking, project structure and commercial contracts.
Masons advised on construction and property issues.
“I’d never worked on a construction project,” admits Berman. “I had a commercial intellectual property and sports background. Similarly, I had no experience on the project financing side. It was a very steep learning curve, which is why we leaned so heavily on A&O and Masons.”
His appointment did make sense, though, and his immediate focus was on the commercial side. For starters, WNSL had event-staging agreements to draft, an agreement with sports marketing group IMG for the sale of premium seats, and the biggest catering contract in the world with Delaware North. All these had to fit in with the demands of the banks and public bodies.
“It took a huge push to have a phenomenal number of complex documents negotiated and signed, and bank funding in place,” says Berman. “Every contract had a knock-on effect on all the others, so whenever something had a slight twist we had to go back and work on all the others as well.”
It took until September 2002 to achieve financial close – longer than everyone would have liked. “Having negotiated what we thought were the contracts, we then had to make sure the banks were happy with them, which meant going around everyone again,” he says. “When you’re lending £430m into a project you want to make sure things are watertight. A normal sports event staging agreement has a lot of standard provisions within the sports industry, but a bank with a £430m interest wants things tightened up.”
Between Sport England, the Government and the Mayor’s office, the public sector invested £160m. It too needed confirmation that there was no wastage of public money.
“It was also mindful of the Millennium Dome experience, which to us was wrong,” says Berman. “The Dome was a venue concept that people wanted to build and make the best of, whereas this is a tried and tested method and content. People come to watch cup finals, England games and concerts. It will work. It’s not really comparable but the public sector had that in mind.”
And all the while the media storm raged. “It was understandable,” says Berman. “There were a lot of frustrations and things have taken a long time. There were historical problems. The stadium had closed and then two years of nothing. There had been a situation where athletics were part of the stadium, then weren’t, then were back in again. There were a lot of reports and investigations, which helped develop our corporate governance and give the various government bodies that much more confidence in things being robust and managed properly.”
One tabloid story stated that £80m was spent on lawyers’ fees. Wrong, says Berman. “They had taken the figure that had been published for professional and consultants’ fees: architects, accountants, tax advisers, lawyers, transport and planning but it was lawyers [that the stories focused on]. It was nowhere near that amount.”
Despite his disdain for the misrepresentation, it seems that public accountability only goes so far. “It’s a reasonable six-figure annual spend,” is as close as Berman will venture to putting the tabloids right.
Following the financial close, long-term FA adviser Bird & Bird was called in to handle the commercial contracts Allen & Overy had previously advised on. “There was no quality issue. It was purely to save costs between the FA and Wembley,” says Berman.
Small Reading firm Blandy & Blandy is the only other firm to get in on the act, advising on how to implement operational licences such as alcohol.
Now all these relationships need managing. Multiplex needs to be monitored, and reports made to the FA, banks and public sector bodies. “We have to make sure we’re complying with hundreds of contracts, which are hundreds of pages long,” says Berman.
IMG is a big part of the project. Of the 90,000 seats, 17,000 will be premium seats with hospitality packages attached. IMG has a team dedicated to selling these seats, which are key to repaying loans.
And the place will be full of lawyers, it seems. “Pretty much every big firm has bought either a box or seats, or if it’s not the firm itself it’s individual partners as part of their department budget. They’re all going to be here,” says Berman. He hopes to see you all at the 2006 FA Cup Final.
Head of legal and corporate affairs
Wembley National Stadium Limited
|Organisation||Wembley National Stadium Limited|
|Head of legal and corporate affairs||Darren Berman|
|Reporting to||Financial director Roger Maslin and chief executive Michael Cunnah|
|Main law firms||Allen & Overy, Bird & Bird, Masons|