Brought over from the Harry Kane thread in the Transfers section.
Yes, in short, I am comfortable with the level of Spurs’ debt. Would I rather we were debt free? In an ideal world, of course. But, in reality, it would mean that we would still be in a small stadium that wasn’t fit for purpose and that our revenues, in normal times, would be £100m per annum lower. It would also mean that COVID hadn’t happened. Alas, we can’t wish it away.
Had our debt been incurred by gambling on players and wages, I would be deeply concerned. But it has instead paid for a world class capital asset that is already proven to be a cash cow. As a consequence, Spurs’ net assets far exceed net debts.
Of course, COVID has had a deeply damaging effect on every club’s finances. As a consequence, Spurs have recently raised a further £250m of debt. It’s not debt that has bought anything. There’s no asset to show for it. But there was no getting away from it either. And every other club will be experiencing similar issues. In that respect, Spurs will be better off than most. Not many clubs are sufficiently trusted by financial institutions to borrow such amounts on favourable terms.
All the debt - stadium and COVID - is long term and low interest. The total interest payable per annum is less than £25m - so, easily serviceable. And that is key. Because cash flow is key. Cash flow crises are why football clubs generally get into trouble. And Spurs have no such worries because of the long term debt at low interest rates.