A deal struck in 2014 meant the council would receive payments if the profits made by Abu Dhabi United Group (ADUG) on schemes in Ancoats and New Islington exceeded a certain level. But Prof Adam Leaver, co-author of a 2022 report by the University of Sheffield into the council's relationship with ADUG, said commercial secrecy around the arrangements meant it was hard to know if the council got the best value it could. The council said it expected another payment soon, and that the regeneration had been worth £1.25bn to the city.
In 2008, Manchester City was bought for £200m by ADUG, owned by Sheikh Mansour bin Zayed Al Nahyan - a senior member of the Abu Dhabi ruling family, who is a current vice president and deputy prime minister of the United Arab Emirates (UAE). In the next decade, the club went on to win the first three of eight Premier League titles, and ADUG and Manchester City Council became partners in a company called Manchester Life. But in 2018, the Premier League began investigating the club's financial dealings, and, last week, it announced the club had been found guilty of 115 charges, including some around a so-called disguised funding scheme, which was said to have seen the club's owners topping up sponsorship and commercial deals with more than £800m of their own funds.
The club continues to deny any wrongdoing and have until 2 October to submit an appeal. Since then, Manchester City Council's relationship with ADUG has come under renewed scrutiny. Under the terms of the Manchester Life partnership, ADUG was able to lease development sites owned by the council across east Manchester, near to the club's stadium.
The council and ADUG struck an overage deal. Such deals are common in partnerships between public authorities and private developers, and normally ensure that if the value of a plot of land increases beyond a certain limit because of development or it being sold, the authority receives a share of what are sometimes known as the "super-profits". According to Leaver's 2022 Manchester Offshored report, about 10 acres of land were transferred into Manchester Life's control.
The report estimated about £112m of property sales had been made by companies ultimatley owned in Abu Dhabi. Leaver told the BBC that it was hard to gauge how good a deal the council had struck. He said it was not possible to see how much profit had been remitted to ADUG from connected companies registered in Jersey, where there is far less transparency about companies' finances.
"So we can't compare how much profit was received by the council relative to their ADUG partner," he said. He added the fact that the overage agreement's terms were concealed from public view meant it was not possible to know how much profit ADUG needed to make before it was obligated to give a share to the council. In July this year, the council revealed that reviews of how it managed and monitored overage deals with developers found "weaknesses in documentation, monitoring and assurance, particularly around historic overage arrangements".
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