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News
Major behind-the-scenes change at Leeds could unlock £40m PSR boost
A raft of changes behind the scenes could unlock a major financial fair play boost for Leeds United.
FFP (now called Profit and Sustainability Rules, or PSR) was a concern for many Leeds fans after chairman Paraag Marathe refused to rule out player sales this summer.
Those comments came in the wake of Leeds‘ failure to win promotion to the Premier League via the play-offs, which would have been worth north of £100m for the club.
However, concerns about PSR have largely been overstated.
The £40m sale of Archie Gray to Tottenham as well as the departures of Tyler Roberts and Luis Sinisterra – both of which came in the 2023-24 financial year – have eased PSR anxieties at Elland Road.
Those sales have offset the £70m that Leeds owed in transfer instalments for 2023-24.
Meanwhile, the club’s remarkable high commercial and matchday income, as well as what is likely to be the biggest cut of media rights in the division, have also buttressed their PSR position.
Now, the latest official news from West Yorkshire could signal that the club are set for another sizable financial boost further down the line.
Leeds make two new boardroom appointments
As relayed by The , Andrew Schwartzberg and Eugene Schneur and have joined the board of directors at Leeds.
Schwartzberg will take the role of vice-chairman, stepping into the position vacated by Rudy Cline-Thomas.
Cline-Thomas, who joined Leeds during the takeover by the investment arm of San Francisco 49ers, will remain as a shareholder but step back from day-to-day operations.
Scheneur meanwhile will join as a member of the board, which is headed up by Marathe, Angus Kinnear and Peter Lowy alongside the two new additions.
Significantly, both new board members have experience which would lend itself well to one of Leeds’ ultimate long-term goals: the expansion of Elland Road.
Schwartzberg co-owns NBA franchise Charlotte Hornets, who are currently redeveloping their stadium the Spectrum Center stadium and surrounding area at a cost of around £200m.
While planning laws are very different in the UK, his expertise in capital expenditure projects will prove useful as Leeds push forward with plans to expand Elland Road.
Similarly, Schneur has significant real-estate experience through his Omni New York company, which specialises in affordable housing and has spent around £1.1bn on property.
Leeds have long-term plans to expand Elland Road’s capacity to beyond 50,000.
Based on their current matchday income and benchmarking against other similar projects, that would easily see the club generated £40m-plus through the turnstiles each season.
That in turn will boost their PSR position, regardless of what division they are in in future seasons.
The club recently reacquired the ownership rights for the stadium from previous owner Andrea Radrizzani, which will allow them to accelerate the project.
- READ MORE LEEDS FINANCE NEWS: Leeds set for controversial £30m off-pitch windfall as Paraag Marathe sets budget
TBR Analysis: How will Leeds pay for Elland Road expansion?
Although it is not yet known what stake Red Bull have purchased, their equity injection in Leeds could help Leeds finance the stadium project.
Alternatively, and depending on the scale of the upgrades, they might choose to go through a lender as has been seen at Everton and Tottenham in recent years.
Interest payments would likely not be too high given that Leeds have the security of future matchday income to leverage, as well as their considerable commercial revenue.
In either case, the expense of redevelopment would not impact PSR as infrastructure costs are exempt from both the EFL and Premier League’s calculations.