West Ham To Become Main Tenant of Olympic Stadium in 2016

West Ham United, the top-flight English soccer team, was chosen as the tenant of London’s Olympic Stadium starting in 2016, ending three years of legal disputes over the prime asset of last year’s games.

The decision “fully protects the interests of the taxpayer and means that no longer will there be any more subsidy going into the running of that stadium but it will actually yield revenues as well for London,” Mayor Boris Johnson said today at a press conference.

London officials set up the Olympic Park Legacy Committee to ensure that venues and other assets built for the games would find future owners after other host cities such as Athens were left with unused properties. West Ham was chosen to be the stadium’s tenant in February 2011, before conflicts with Barclays Premier League rival Tottenham Hotspur and third-tier club Leyton Orient caused delays.

East London-based West Ham will lease the 537-million pound ($816 million) stadium for 99 years, which secures year-round use of the centerpiece of the London 2012 Olympics and Paralympics, the London Legacy Development Corporation, successor to the Olympic Park Committee, said in a statement today.

Sliding Seats

The cost to adapt the venue that hosted the 2012 Olympic opening and closing ceremonies into a stadium suitable for soccer will be as much as 190 million pounds and West Ham will pay 2 million pounds rent a year, the British Broadcasting Corp. said on its website earlier today.

Seat capacity will be reduced to 54,000 from 80,000 and a roof will be installed, according to the LLDC, which oversees the re-use of the facilities from the games. A retractable seating system that slides over the stadium’s running track will be built so the venue can be used for various sports events such as the 2017 athletics world championships.

West Ham will contribute 15 million pounds to the deal, with Newham Council investing 40 million pounds, the LLDC said. The U.K. government agreed to pay an extra 25 million pounds if its needed to adapt the venue.

The stadium agreement will “generate hundreds of new jobs, encourage many thousands of visitors to the local area and act as a catalyst for further economic investment and growth in the area,” the LLDC said.

‘World Class’’

The new lease will allow West Ham to move into “a truly world-class,” soccer stadium from the 2016-2017 season, West Ham Vice Chairman Karren Brady said in a statement on the club’s website. The move also provides the team, known as the Hammers, with “an opportunity to improve our fortunes on every level including opening doors to new revenue streams.”

Earlier this month, English third-division soccer club Leyton Orient said it filed a lawsuit in the U.K. High Court over plans to allow the Hammers to become the stadium’s anchor tenant. The team blocked an earlier plan to allow the Hammers to take over the site with another suit.

Leyton Orient wants to use the stadium alongside West Ham, and said the legacy company didn’t allow the award to both clubs, as was permitted in the application.

“Our plan was, and remains, to be the community offering alongside a wealthy Premier League club,” Orient Chairman Barry Hearn said at the time.

West Ham was picked in December as the “first-ranked bidder” for the stadium. That marked the second time the team was chosen as the top candidate.

Second Time

The Hammers and the Newham local authority were initially chosen over a joint bid by Premier League team Tottenham Hotspur and AEG, a U.S.-based entertainment facility operator. In October 2011, that agreement collapsed following a series of legal challenges from Tottenham and Orient and an anonymous complaint to the European Commission.

In 2011, U.K. developer Delancey Estates Plc and a unit of Qatar’s sovereign wealth fund agreed to pay 557 million pounds for the athlete’s village in London’s Olympic Park. BT Group Plc, the U.K.’s biggest fixed-line phone company, said in November it will lease part of the former Olympic International Broadcast Center for its new television sports channels.

West Ham plays at Upton Park, which seats about 35,000, while Orient’s Matchroom Stadium holds 9,271 people. West Ham is currently 14th in the Barclays Premier League, the top flight of English soccer.

Before it's here, it's on the Bloomberg Terminal.