According to two people familiar with the situation, Real Madrid FC plans to borrow roughly €370 million ($390 million) from institutional investors to help pay for the refurbishment of its renowned Santiago Bernabeu stadium.
The most successful football team in Europe is gathering the funds through private debt issuance, according to people who asked not to be named because the talks are secret. The debt will be repaid with proceeds from ticket sales in a system known as a waterfall payment structure.
In recent times, Europe’s elite clubs have found that private loan markets, which provide greater privacy than public debt auctions and are less vulnerable to emotional fluctuations, are a valuable source of revenue.
Chelsea FC received £500 million ($604 million) in subordinated debt from US direct-lending giant Ares Management Corp., while rival FC Barcelona of Madrid borrowed €1.5 billion from private debt investors to finance its own stadium renovation.
Calls and emails for comment were not immediately answered by a Read Madrid official.
Real Madrid, the team that has won the Champions League 14 times in a row, has taken on debt multiple times since 2019 in order to finance the construction of its stadium. The improvements, which are almost finished, include adding more seats and installing a retractable field, which will let the club store the grass while it holds other events that bring in money, like tennis matches or concerts.
The club’s members must authorize the borrowing in a general assembly, as they own Real Madrid. The club has the option to choose a later time today for such a gathering.
