Serve ace of a seat at Wimbledon, get 75% returns

Time of India

4 days ago

For two weeks every summer, the Centre Court at Wimbledon is where fans can watch the best tennis players in the sport's most prestigious amphitheater. For some of the most expensive ticket holders, it's not even worth attending.
That's because owning so-called debentures - a guaranteed seat on Centre Court or No. 1 Court for a five-year stretch - has become so profitable that many are choosing to treat them as a tradeable asset, selling them on for a significant profit.
Centre Court debenture seats for between 2026 and 2030 are already changing hands at over £200,000 ($275,300) once the final installment is included, a profit of about 75% due to soaring demand from US buyers, according to market-maker Dowgate Capital. They went on sale last year for £116,000.
Debentures guarantee wealthy tennis lovers prime seats, as well as VIP access to lounges and restaurants. On days they can't attend, they're able to sell their tickets for the day - the only exchangeable tickets for Wimbledon. And investors are increasingly getting in on the action, buying up debentures solely to sell them for a profit.
"You get tennis fans coming to Wimbledon as the mecca of tennis from all over the world, particularly the US," said Alex Cheatle, Chief Executive Officer of Ten Lifestyle Group Plc, a luxury concierge service that snags debentures for its high-net worth clients.
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Just as the valuations of sports teams and franchises have soared in recent years as private equity firms and billionaires race to get a piece, so has the price to attend flagship sporting events. Tickets for Premier League games have increased 800% since 1990, while a seat at the 2024 Super Bowl in Las Vegas was selling for an average of about $10,000.
Debentures are used by many sports clubs, from Arsenal Football Club to the Minnesota Vikings, to help raise funds often to cover construction costs.
Wimbledon debentures
were first sold in 1920, with the £100,000 raised used to fund the building of the Centre Court. Debentures have paid for everything from installing retractable roofs on the two main courts guaranteeing play when it rains - to building 12 new courts in the past six years. They will also be used to help fund an expansion plan to add 39 courts and an 8,000-seater stadium, though this has been met with local opposition.
Part of the £74 million the club expects to raise from the latest No. 1 Court debentures will go toward redeveloping exclusive areas for holders. These debentures that start in 2027 went for £73,000 each in May, a 63% increase from the previous round.
"They're incredibly important," said Fiona Canning, the associate director of finance and debentures at the
All England Lawn Tennis Club
, which manages the annual tournament. "They fund all the capital work on our site."
The returns made trading debentures for Centre Court seats that start next summer work out at 75%. Since the first payment was made on May 17 last year, the FTSE 100 has risen less than 4% and the S&P 500 is up 17%.
Debentures are regulated because they're considered financial instruments, similar to bonds. Regulation provides the buyer with protection and transparency, allowing buyers on the secondary market to see the prices they're trading for.