Investors in the proposed new Auckland A-League team will need to stump up more than $20 million to be part of the competition from the 2024-25 season.
That figure, which is the licence fee for entry, looms as the biggest hurdle in the ambitious but exciting plan, with annual operating costs on top of that.
Wednesday was a red-letter day for football in this country, with the Australian Professional Leagues (APL) confirming that Auckland is one of two preferred bases for expansion, with Canberra the other venue.
It has been mooted for some time but this development has brought it closer than ever.
APL chief executive Danny Townsend told the Herald they hope to have the bones of the new entity in place by June, ahead of launching the team the following year.
Townsend didn’t expect the licence fee to be a stumbling block, after the introduction of Western United (2019) and Macarthur (2020).
“There is a baseline for what the last licence fees went for – near enough to A$20 million - and what they were investing in at the time is certainly not what they are today,” said Townsend. “We are expecting that [figure] to rise.”
Townsend pointed out that prospective new owners will have a shareholding in the league, rights to the club’s intellectual property and no expiry date on the licence, following the unbundling of the league from Football Australia in 2020.
Townsend is confident, given football’s global reach, that finding investors won’t be an issue.
“It’s a sophisticated, high-performance football league in an English-speaking environment and you are guaranteed to be in the top flight. There are lots of unique positives. We are a great proposition.”
“The market will determine what it is worth...this is about finding the right shareholders and partners for the APL. We are not looking to hand out a licence, we are looking to find business partners.
The preference is for a consortium of investors, rather than sole ownership.
“Having one investor is problematic in some instances,” said Townsend. “We would rather have multiple owners but we are not going to rule anything out at this stage. We hope those involved are in it for the long haul and want to be good partners.”
The venture is likely to include an overseas component but Townsend emphasised that local stakeholders were critical, along with pre-existing football acumen.
Auckland City FC will be a strong candidate, given their achievements and experience, but there are others in the mix.
The push towards Auckland evolved from two factors.
There was a feeling that the competition needed to embrace this country – as a genuine Australasian league – while Auckland also came out on top on numerous metrics, including population base, commercial opportunities and participation numbers.
“Auckland has all the ingredients to be successful,” said Townsend.
He added that lessons had been learnt from the failures of the Football Kingz (1999-2004) and New Zealand Knights (2004-2007), while the environment was completely different both in terms of club ownership and league structure.
The new club, which will encompass both men’s and women’s teams, will be based at Mt Smart Stadium in the short term, though Townsend is hopeful that a new option will emerge in time.
“Auckland deserves that kind of facility”, said Townsend.
He said that crowds of 10,000 would be the benchmark, adding that Auckland has the potential to do better than that.
Wellington Phoenix general manager David Dome said there were “pros and cons” to a potential Auckland team.
He agreed it would raise the profile of football generally and help with the development of players, with the Phoenix academy currently doing a lot of the “heavy lifting” in that area.
There would be “challenges” for the Phoenix but they were ready to meet those and backed their existing infrastructure and high-performance unit.
Dome also cautioned that the prospective journey from idea to establishment would be far from easy.
“It’s extremely difficult,” said Dome. “The investment is significant, not just financially but also in terms of the intellectual property required to run a professional club. You have to source players and staff and neither is easy in the market we work in.”
“There’s also a massive infrastructure cost to get it up and running. Training grounds and facilities and football grounds to play on, it’s not an insignificant investment. There are some serious financial obstacles to overcome.”