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Stadium wrangles endanger Poland's Euro 2012 dream

Poland is in danger of losing its right to host the Euro 2012 football tournament to Italy because of wrangles over the main stadium’s legacy use.

Progress has also been hit by the government’s failure to agree on a location for the venue. And there are doubts that suitable contracting expertise or finance can be mobilised in time.

NCE has learnt that legal teams are now drafting new legislation in an attempt to speed the tender process so that construction can get started next year.

The Polish government expects detailed design and construction of the stadium to take 45 months. With 60 months to go until the opening match, there is now just 15 months to finalise plans, secure funding and tender the project, leaving stadium experts questioning whether it can be delivered in time.

“There is a real danger that if Poland doesn’t have the flagship stadium under construction by the end of next year, then UEFA will have no choice but to pull [the tournament],” said Andrew Briggs, a stadium expert and partner at international law firm Lovells.

Briggs said that under European Union (EU) tender law, a typical project of this size and complexity would take up to 18 months to tender.

“The legal minimum is 60 days, but it is practically impossible to do it in that time. I have occasionally seen it done in nine months,” he said. “The Poles have five or six months.”

The hold-up has been caused by government wrangling over the legacy use of the stadium. Earlier this month Sports ministry political office head Michal Borowski said the stadium would be “either a 55,000- seat stadium just for soccer and Euro 2012 or a 70,000 seat stadium for Euro 2012 and other events – either of these built on the site of the existing stadium or next to it, or on another site altogether, like the racetrack.”

Briggs was unimpressed. “Sitting in the middle of August with the inability to make the decision [on the type of stadium] is not good news.

I suspect it stems from the government not knowing what the legacy usage is and not knowing how they are going to pay for it.”

Head of mergers and acquisitions at Eversheds law firm, Michal Kurzynski, agreed. “The state needs to decide if the stadium is to be built on the site of the 10th Anniversary Stadium or near it, because the technical experts need time to look at the demolition costs.”

Kurzynski advises foreign firms on investment opportunities in Poland. Kurzynski is working as an advisor to the government on a law that would create two companies: one responsible for building the stadium and one for the overall Euro 2012 project.

“The companies would have the power to appoint people specifically to take charge, helping to attract experts from outside the ministry.” Kurzynski added that the new law will have the advantage of separating the companies’ finances from the sports minister’s budget.

It should also make it quicker and easier to sign contracts as they won’t be subject to ministry bureaucracy.

But Briggs is unconvinced. “If they can delegate power to somebody who can make decisions then great, but it doesn’t solve the problem of where the money is coming from.”

With the stadium potentially costing more than £200M, finding the funding and making it quickly accessible is fundamental to the success of the project, but time is running out.

“If they are simply looking to recover the money with games or events in the future, then I think they may struggle, as I don’t think the stadium could command a high enough gate price, said Briggs.

“The timescales on the project are very aggressive. They don’t have a lot of time to put in an organizational structure or construct a complicated credit structure, as they will need to draw a lot of money down very quickly to get the project underway.”

Multinational contractors are wary of getting involved at this stage. “We see another Wembley there,” said one.

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