leeds united owners gfh-c to invest £20million (in luxury flats in london)Back
The Wall Street Journal are reporting that Leeds United owners GFH Capital are investing £20million – in a pair of properties in London.
The news of GFH-C’s moves into the London luxury property market will be scrutinised by Leeds fans, following the club’s quiet transfer deadline day.
The report reinforces the fact that Leeds United are only one of several investments being handled by GFH Capital, whose main priority is their core investment banking business.
Speaking to the Wall Street Journal, Leeds’ managing director David Haigh also revealed GFH-C are looking to invest in technology startups alongside a US-based partner.
Without revealing how many properties have been bought, Haigh told the WSJ that GFH-C has been buying properties in London valued between $15 million and $50 million, and is considering a pair of properties worth £20 million.
The report continues, "As it does with many of its investments, GFH Capital is seeding the purchases and then bringing in co-investors to take up part of the equity," an echo of the method used to buy Leeds United.
Some of the properties are being bought to generate rental income, and others to develop and sell on. David Haigh said: "Most of the investment banks are looking towards London to buy high-end real estate because it creates good yields, I think, and there’s a limit to the amount of people who can acquire it. There’s two we’re doing at the moment and we’re always looking for more."
David Haigh also spoke about the investment in Leeds United, saying he would like to see the club promoted within two seasons:
"We could see immediately there were small things and medium things and large things we could do that would automatically put that club back on an even keel," he said. Attendance is already up, he said, and the club is aiming to reach the Premier League soon."Of course everybody wants to get to the Premier League, because that’s where the money is, but only three of them (promotions) happen every year," he said. "I think we’ve made a good start. We’d like to do it this season. Will we? I don’t know, but I think within two, yes."
The spending on property is clearly designed to bring profits to GFH-C and its investors, but will underline for Leeds fans that the club will largely have to pay its own way on the path to success. With Financial Fair Play restrictions on the near horizon and the club still struggling to shake off the albatrosses of the Ken Bates era, GFH-C seem determined to resist the temptation to spend big money on players, instead growing the club gradually.
In an age where investment banks can be as significant to football fans as the players on the pitch, however, the news of our owners’ other investments will inevitably raise questions of whether that money could have been directed to the club and whether, should those other investments struggle, as during GFH’s near-total collapse in 2009, they will put the investment in the club at risk.
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