Why City’s Etihad Stadium agreement is under review after more than 20 years

City’s agreement with Manchester City Council over the Etihad Stadium is being revised more than two decades after the club first moved to east Manchester.

It sounds more dramatic than it is.

City have a long-term lease on the stadium, which remains owned by Manchester City Council, and the agreement is now being altered as the Etihad and the surrounding campus continue to change.

Why is City’s Etihad lease changing?

City moved into the former Commonwealth Games stadium in 2003.

What surrounds it now bears little resemblance to what was there 23 years ago.

The Etihad Campus has developed into a major sporting and entertainment destination, while the North Stand expansion has taken the stadium’s capacity beyond 60,000.

City are also developing the £300m Medlock Square entertainment district, including a hotel and new food, drink and entertainment facilities.

That creates considerably more commercial potential around the stadium – and helps explain why an agreement dating back to a very different era is being revisited.

The Local Democracy Reporting Service says City currently pay the council a base fee understood to be between £3m and £4m a year, with additional payments linked to income generated around the campus.

The revised arrangement is expected to increase that base payment, although the new financial terms have not been made public.

What has the council said?

Manchester City Council published its decision over a “variation of leases” with the club on August 25, with the decision becoming effective on September 3.

The council said the changes were needed to enable the North Stand expansion and support the wider aim of developing SportCity into a “world-class sport and entertainment district”.

It also warned that failing to agree the variation could affect City’s ability to continue growing as a global brand and potentially cause reputational damage to the council as owner of the stadium.

So this isn’t a dispute over City’s future at the Etihad. It is essentially an existing agreement being adjusted to reflect how much the stadium and surrounding area have changed.

Twenty-three years and an extraordinary transformation later, it is hardly surprising that the financial relationship with the council is changing too.

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