Funding secured for Co-op Live
Joint venture partners Oak View Group and City Football Group have closed a debt financing arrangement to support development of the 23,500-capacity arena.
The transaction was described by OVG as the first of its kind for a music-first venue, with long-term financing provided by Apollo and Barings with a 27-year senior secured note, through their respective clients and managed funds.
This has been supplemented by a five-year senior secured credit facility from JP Morgan. Inner Circle Sports served as placement agent on the long-term financing.
In May 2021, it was revealed that Bam had secured the contract to build the venue at the Etihad campus, in a £253m deal. Completion is expected in late 2023.
The Co-op signed up as naming rights sponsor in September 2020, agreeing a £100m deal to cover at least 15 years. More recently, Diageo was confirmed as the arena’s drinks partner and Bristol Street Motors the venue’s official motor retailer.
The £365m Co-op Live is OVG’s first international venue and is 100% privately financed between the debt facilities provided by Apollo, Barings and J.P. Morgan and funding provided by Co-op Live’s shareholders.
The transaction executed with Apollo and Barings is secured by Co-op Live and the cash flow generated by the arena over 27 years.
OVG said this is the world’s first private, long-term, non-recourse financing that will cover most construction costs for a facility without a traditional professional sports anchor tenant.
Francesca Bodie, president of business development, Oak View Group, said: “We’re proud to have closed this pioneering financing to help fund the development of Co-op Live, which will deliver one of the world’s best arenas to Manchester.
“It shows the confidence in our business model and ability to deliver on a robust, year-round calendar of unparalleled music and other content.”
The OVG team currently has 11 arena projects under development globally, with its next opening scheduled for Austin, Texas this year.
In November last yar, OVG outlined the sustainability credentials of the scheme, which it said will be the UK’s first all-electric venue.
The architect for the project is Populous, which has become a noted design firm for big-ticket destinations, with a portfolio including the Tottenham Hotspur Stadium and the T-Mobile Arena in Las Vegas.