The sports industry has repeatedly demonstrated its ability to act as a catalyst for economic and social development, connecting global communities, attracting inward investment, contributing to gross value added, creating employment opportunities, and delivering positive health outcomes. I've been doing it.
2024 will see a record number of global elections, with more than 2 billion voters in 50 countries participating. While each country faces unique challenges, common macro factors such as climate change, geopolitics, digitalisation, economic growth and prosperity impact the lives of all voters. As budgets shrink and demands on public services increase, the opportunity for public and private sectors to work together to address these challenges and seize opportunities is critical.
Elite sport has emerged as a powerful catalyst for economic and social growth and can align public and private investment plans. Despite fluctuations in the M&A market, investment activity in sports remains strong and sports investors can work with governments to achieve long-term results that extend beyond the boundaries of the playing court, arena, and pitch. It hides its sexuality.
According to Deloitte's 2024 Sports Investment Outlook, one in five investment deals signed with sports rights holders around the world in 2023 were signed with UK-based organizations. This market has found that Elite Sports has a proven track record of benefiting local economies in his five key areas:
1. Global brand profile: When used effectively, sport can stimulate tourism, boost the visitor economy, and create tangible connections with the communities surrounding these assets. According to UK Sport, major sporting events held in the UK in 2023 will generate a direct economic impact of £373 million, with a return on investment of 6:1, with 93% of the UK population playing a major sport. They agree that the event will raise the international profile of British cities. .
The UK hosts an elite group of world-famous clubs, leagues and major sporting events, including prestigious clubs such as the Premier League and English Football League (EFL) clubs. The commercial appeal of these assets provides a unique opportunity to bring the best of towns and cities to a growing national and international audience. A wide range of organizations are also expected to benefit, including academic research showing a link between relegation of university-affiliated Premier League teams and declines in university enrollments.
2. Infrastructure investment: The 2024 Deloitte Football Money League publication highlights that clubs' more effective use of stadiums, including on non-match days, underpinned revenue growth for the 2022/23 football season. Stadium development could also bring wider benefits, with Tottenham Hotspur announcing in December 2023 that the stadium development would triple gross value added, with the club adding an estimated £900m of gross product to the capital. reported contributing to the economy.
With growth a common goal for the public and private sectors, governments can work with sports investors to provide additional investment in infrastructure such as transport and local resources. For example, Luton Town's announcement about the club's stadium development at Powercourt states that this includes: 'Building an entire new town for Luton with 1,200 homes, leisure, restaurants, bars, retail and community spaces. ' was accompanied by news of the club's aspirations. ”
3. Rebuilding the community: Sports organizations can unite communities, increase civic pride and a sense of unity, and further diversify a city's cultural offerings. By using sports venues as anchors, local authorities can increase attendance and create thriving, sustainable places that people want to visit and live in.
The regeneration of Manchester's Eastlands area is a great example of how football, and stadiums in particular, can be at the heart of regional regeneration. Manchester City moved to the Etihad Stadium after the 2002 Commonwealth Games. Since then, the stadium has become a focal point for the regeneration of the area, which has seen the development of a collection of new community education and leisure facilities, including the National Cycling Center and the Co-op Live Arena.
4. Education, work and skills: Sports organizations function as large corporations, providing more than just entertainment. These organizations contribute to the economic growth of their local markets, not only through the employment of athletes on the pitch, but also back and front office staff, match day and casual work. Additionally, sports organizations often work with communities to provide education, training, and skills programs.
Following the 2012 Olympics, London Legacy Corporation announced the launch of apprenticeship opportunities at Queen Elizabeth Olympic Park. Hundreds of young people are joining employers in construction, digital, culture, creative and fashion-related businesses, and half of our apprentices are local young people. Recently, Knighthead Capital Management announced that the development of East Birmingham's Sports Quarter is expected to create more than 3,000 jobs locally.
5. Health and Well-Being: Sports organization participation programs provide countless benefits to the industry and the broader community. These programs provide opportunities for clubs to identify and develop homegrown talent, encourage local communities to take part in physical activity and ensure quality pitches, coaches and competition.
Research commissioned by Sport England shows that for every £1 spent on sport and physical activity, £4 is generated in health and wellbeing, strengthening communities and national economies. The proven correlation between increased levels of physical activity and improved health outcomes highlights the unique role sports organizations play in helping governments achieve health outcomes.
Important points
For government: Each town or city offers specific demographic drivers and growth opportunities that attract sports investors to the property. By working with private investors, governments can accelerate the impact of public funding and increase opportunities for council activation, engaging with local and international fans and enabling community participation. Local government leadership and a willingness to collaborate are essential to success.
For rights holders: Investors and government agencies provide vital capital to support the growth of sports rights holders and the impact of their work. By strengthening our governance structure, optimizing data management and activation, and continuing to expand our relationships with governments and investors as appropriate, rights holders will be able to consider future funding and investments. .
For investors: There has been an influx of investment into sports in recent years, and Deloitte expects this to continue into 2024 and beyond. As super-premium and premium assets continue to change hands, relatively low entry point opportunities may also arise in non-premium real estate. Our proven strategy in commercial real estate-focused investments across North America is attracting investors seeking similar synergies in new geographies. Investors are increasingly looking to European assets as opportunities for commercial growth, and this is underlined by the prospect of developing new or enhanced stadiums and providing social and economic incentives for local communities. Masu.
For the community: Investing in sports infrastructure across towns and cities can have significant benefits for individuals across communities. Improved access to sports facilities and grassroots programs increases community participation in sport, improving mental and physical health, as well as supporting social inclusion and community connections. may be. When young people experience good physical education and gain knowledge about physical activity, their life skills can also improve in the long term.
About Deloitte’s work in sports-led regeneration:
Led by teams across Deloitte's Sports Business Group, Economic Advisory and Real Estate Advisory practices, Deloitte has advised on some of the UK's most ambitious sports-led regeneration projects.
The firm's expertise includes development advice, securing inward investment and assessing the social and economic impact that sport has on people and places.
Deloitte's work includes advising on the development of the Queen Elizabeth Olympic Park, Leicester City Training Ground and the growth of the Etihad Campus, including the expansion of Etihad Stadium and the construction of a new major arena, Co-op Live.
