Arsenal Football Club has been forced to begin talks to renegotiate its loan
terms after revealing it had not completed the sale of as many properties at its
Highbury development as anticipated.
The club is due to pay off £135m by April 2010 on a loan taken out to build
flats at its former ground, but fewer sales have been completed then expected.
Posting its interims, chairman Peter Hill-Wood said that company was at a
‘preliminary stage’ of discussions with its lenders to revise the terms of the
loan beyond 2010, and it was likely a new deal would be more expensive.
‘In the current financial climate the directors do not expect these
discussions to be concluded quickly, an increased cost is likely to be involved
and there can be no certainty that a satisfactory agreement will be reached, but
they believe that a positive outcome will be achieved in due course,’ said
Hill-Wood in the report.
The number of dropped deals is low, said hill-wood, but purchasers were
struggling to secure their mortgage deals.
Construction costs for the development have been met in full and any flat
sales will go towards paying off the loan.
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