Football finance: can music events help clubs navigate PSR rules?

Until recently, the Profit and Sustainability Rules (PSR) had largely gone unnoticed. However, the English Premier League (EPL) has recently began stricter enforcement. This is significantly impacting top clubs across the country, forcing them to adapt to tighter financial constraints.

The PSR allow clubs to incur losses of up to £105m over a rolling three-year period. Of this, up to £15m can be direct club losses, while the remaining £90m must be covered by the clubs’ owners. The process aims to maintain a “level playing field” across the league, promoting fair competition and financial stability among all teams.

Following charges issued to Nottingham Forest, Leicester City and Everton, clubs agreed that the regulations were overly complex and challenging to comply with. As a result, clubs proposed gradually phasing out the PSR, replacing them with the Squad Cost Ratio Rules and the Top to Bottom Anchoring Rules. This would align the EPL’s financial model more closely with those used by UEFA and other football governing bodies across Europe. Despite this, a formal vote never took place, meaning that the new rules will not be implemented until the 2026/27 season at the earliest.

How football clubs are adapting to PSR restrictions

The main impact of PSR is the restriction on how much clubs can spend on their squads. To balance their books, clubs may be forced into more player sales. This was particularly evident in the summer 2024 transfer window, with numerous deals occurring between the clubs that were reportedly struggling to comply. There was also a broad trend whereby clubs sold “homegrown” players from their academy with no underlying cost, allowing them to be recorded as pure profit. Clubs can also sell assets such as training grounds, women’s teams or other properties to parent companies to generate immediate income.

Another impact of PSR is that clubs now need to consider the timing of their transfers more carefully. This year, the Club World Cup means that the EPL summer transfer window will be split into two parts, commencing on 1 June until 10 June, before reopening on 16 June until 1 September. The rolling three-year count resets at the start of July, prompting clubs to sell players before 30 June to reduce their losses. The early window was introduced to assist those competing in the competition, but we may also see activity from clubs looking to make a head start on keeping their accounts in order.

In addition, clubs can reduce the impact of PSR by manipulating the length of contracts of new signings. By extending contract periods, the clubs can spread the cost of players over a longer period. However, the rules were revised after Chelsea started signing players on contracts of up to eight and a half years. The new rules allow clubs to spread a player's transfer fee over a maximum of five years, regardless of the actual contract length.

Multi-purpose stadiums: a new revenue stream for football clubs

Developing multi-purpose stadiums has become an increasingly popular approach for clubs aiming to diversify their income beyond matchday revenue and strengthen their PSR position. The Tottenham Hotspur stadium, which opened in 2019, features a retractable grass pitch that can slide away to reveal an artificial turf beneath. Among other design features, this allows the stadium to host major concerts and other sporting events.

At the time of writing, Spurs have 23 non-football events planned during this year’s off-season. Alongside NFL fixtures, the likes of Beyoncé, Chris Brown, Imagine Dragons, Kendrick Lamar and Post Malone will all be performing there. Spurs’ recent qualification for the Champions League will no doubt offer a significant financial boost, but the ability to generate consistent off-pitch revenue will help them to ensure financial stability and long-term competitiveness.

Real Madrid has also recently invested in a multi-purpose stadium. However, the renovation of the Santiago Bernabéu, completed in September 2023, demonstrates both the complexities and challenges this can present. After hosting their first concert, residents lodged various complaints to the council regarding the finishing times, the sounds exceeding legal decibel levels and anti-social behaviour.

As a result, subsequent concerts were cancelled and the club committed around €10m to soundproof the Bernabéu to make future events viable again. This substantial investment highlights the club's commitment to fully utilising the multi-purpose nature of the stadium and the importance of the revenue it can generate. Like Spurs, Real Madrid aims to host 10–12 concerts per year to maximise revenue and assist in complying with UEFA’s Financial Sustainability Regulations.

The future of football finance: stadiums, music and global trends

As football clubs navigate an ever-changing landscape, several questions arise about the future direction of the sport and how clubs will continue to evolve. With Manchester United and possibly Chelsea exploring new stadium options, could the shift toward multi-purpose stadiums be football’s next big trend?

With half-time shows reportedly planned for the next World Cup, the football and music industries may become even more intertwined. The growing popularity of the multi-club ownership model could also mean that we see artists on world tours performing at each of the stadiums owned by these clubs across the world.

Given the potential on-field consequences of breaching PSR, football success now depends as much on smart accounting and strategic decision-making as on performance.

Whether you’re reassessing your financial position under PSR or exploring alternative income streams, our specialist team can provide the insight and support you need. Contact Adam Jefferies for more information.