Florentino Perez's modus operandi with Real Madrid's urban development projects

Madrid/Barcelona"I remember I was meeting with the president [Florentino Pérez]. From his office you could see some towers and he said to me: "They are the galacticos: Figo, Ronaldo and Zidane." And then he said to me: "Look, this is your [tower]." And I thought: "Well, I like it." Netflix which is titled BeckhamThe former Real Madrid player is referring to the Cuatro Torres, the most symbolic area of Madrid's financial and business district, between Chamartín train station and the Santiago Bernabéu stadium, almost at the end of Paseo de la Castellana. In fact, they are four skyscrapers popularly known as the Cuatro Torres. Florentine TowersBut what Beckham narrates goes largely unnoticed throughout the documentary series, until it has returned to the imagination of some in recent days. The underlying theme is the presentation of the major urban development project. Madrid Innovation District which, like the four skyscrapers, could provide a breath of fresh air for the club's coffers. In both cases, urban redevelopment plays a key role.

Inch by inch. Madrid Innovation District It was presented just two weeks ago by Florentino Pérez himself from the boardroom of Real Madrid's Sports City. It's an urban development project that seeks to transform the Spanish capital into the technological district par excellence of Southern Europe. "It will be a space for companies, entrepreneurs, for specialized education, training, and the development of AI," Pérez boasted during his presentation speech.

The main developer of this future technology district is Real Madrid itself. The project is located in the Valdebebas neighborhood, specifically on land (85 hectares) that forms part of the Real Madrid Sports City (120 hectares). Of these 850,000 square meters, however, it is not yet known how much will be built.

However, as the name suggests, this is an area that makes up the sports city, and therefore, the land is intended for sports use and not tertiary use (when it could be used, among other things, for offices). In any case, this will be short-lived, or at least that's what the club's ranks expect. The Madrid City Council will rezone this land (change its use) through an amendment to the 1997 Madrid General Urban Planning Plan (PGOU) to allow for the construction of the macro-project, as previously announced. Five Days and confirmed by the Department of Urban Planning in the ARA. The modification will then require the approval of the Community of Madrid, although the words of the Madrid president, Isabel Díaz Ayuso, on the day of the project presentation already anticipate her position: "It's an exciting challenge. Both the Ministry of Urban Planning and the Community of Madrid are also promoters of the project.

History repeats itself

Considering all this, the parallel with the history of Cuatro Torres is more than evident. First of all, because the land on which the skyscrapers stand was also part of Real Madrid's sports city. Twenty-five years ago, just before the era of the Galacticos, that land was also rezoned, and with the proceeds the club obtained from its subsequent sale, it was able to pay off its debt, but also to sign four star players, as Beckham's words confirm. In total, Madrid sold 148,777 square meters for 100 billion pesetas (the equivalent of 600 million euros).

Furthermore, for a time, the club kept two entire towers, while a third was shared with the Community of Madrid. The fourth was kept by the City Council. Real Madrid would later sell them, reaping millions. Furthermore, ACS, Florentino Pérez's construction company, participated in the construction.

"It's yet another scandal. City Hall has entered into the dynamic of transforming the city to suit the logic of developers and business owners," reflects Madrid architect and member of Ecologistas en Acción, Luis Suárez, in a conversation with ARA. A person closely familiar with urban development changes in the Spanish capital, he denounces that rezoning should be an "exception" and not an "everyday mechanism."

No concerts, no public parking

Madrid Innovation District This could represent another avenue for Real Madrid to generate revenue, although it's not imminent considering the timescales of these major projects, especially with regard to bureaucratic procedures. In fact, the club hasn't put any figures on the table. In any case, this could be crucial, considering that Florentino Pérez has seen two of his new business areas fail, so far.

One is to convert the new Santiago Bernabéu into a concert stadium. For now, and as a result of pressure from residents due to excessive noise, all planned events have been suspended. The club expected this business area to lead to revenue growth, to the point that it created a new independent company: Real Madrid Estadi SL. The 2023/2024 Economic Report shows how the income has gone from €402,000 for "events and concerts" to a total of €8.5 million in 2020. the stadium (where revenue has grown the most), in the 2024/25 budget it is linked to the area VIP and in the museum and tour experience, while the concert stumbling block is dismissed as a simple "rescheduling." It should be noted that the Bernabéu's renovation has entailed a colossal expenditure of 1.162 billion euros, to which must be added 1.154 billion euros in loans.

The other business that has derailed is the public parking lot next to the Bernabéu. Madrid City Council awarded the project to Real Madrid, but the courts halted it due to a "lack of public interest." "What a coincidence that this rezoning is now coming," reflects Suárez. Madrid has already allocated sixteen million euros to the first phase of construction of this service, as revealed in the 2023/2024 Economic Report consulted by ARA.

And the signings?

For Real Madrid, like any other team, revenue is key if they want to embark on next season with new faces. The fact that Madrid has been able to regularly enter the transfer market doesn't mean they haven't had to make internal adjustments to achieve this.

Specifically, the rising cost of the Bernabéu renovation and the failure of some of the business lines have put the club's accounts under pressure. The Real Madrid leader had already activated a lever, selling part of the business at the new Bernabéu stadium on Sixth Street for 360 million euros – a loan suspended due to the cancellation of concerts. Last season, he made another deal worth 82.9 million euros: selling part of the boxes VIP to various companies to market them for thirty years. Thanks to this income, Madrid saved its accounts.

For its part, the urban rezoning will not only mean a shower of millions for the club. It will also be key to the change of ownership of the club, which is the project Florentino Pérez is working on and which he wants to secure before he leaves the presidency. Ultimately, the president has been doing as he pleases for the past sixteen years: he returned to the Bernabéu box in 2009 as the sole candidate and has since been renewing his mandates without having to call elections. The last time was this season and until 2029. But Florentino is not eternal, and with the new ownership model, he aims to ensure that all his governing work is continued by someone he trusts.

For all these reasons, the urban development series surrounding Real Madrid seems to be unstoppable. "I did everything possible to get [David Beckham] to come to Real Madrid," Florentino Pérez himself admits in the documentary. Netflix about the player. Twenty-five years later, he's once again doing everything possible to achieve his goal.