Title: Santiago Bernabéu’s Vision: Real Madrid’s Stadium and the Rise of Gentrification
Subtitle: A Historical Perspective on Land Value and Urban Growth
In 1943, amidst the turmoil of the Second World War, Santiago Bernabéu assumed the role of president of Real Madrid soccer club. Little did the world know that his visionary leadership would not only transform the destiny of the club but also shape the future of urban development. Bernabéu, with a fervent desire for success, proclaimed to his team, “Gentlemen, we need a bigger soccer field and we are going to get it.” These words would mark the beginning of an extraordinary journey that would elevate Bernabéu’s name from that of an individual to an iconic symbol, synonymous with greatness.
At the time, football stadiums were already a prominent feature in many city skylines. The period between 1890 and 1910 saw the construction of the first stadiums, with England alone witnessing the creation of 50 such venues. These stadiums were typically situated in close proximity to the city center, as transportation options were limited, making it easier for fans to attend matches. The sheer magnitude of the crowds was astounding, with a match at Crystal Palace Stadium in 1913 drawing a staggering 120,000 spectators—almost 40,000 more than the capacity of today’s major stadiums.
Santiago Bernabéu astutely recognized the growing demand for soccer and the potential for financial success that lay within. He understood that a larger stadium would accommodate more fans, resulting in increased ticket sales. The revenue generated could then be used to attract top-tier players, leading to on-field success and a further influx of spectators. It was a virtuous cycle that Bernabéu sought to establish.
To realize his grand vision, Bernabéu needed to find the perfect location for the new stadium. Accessibility and size were the key considerations. Fortunately, transportation had improved significantly since the early 20th century, allowing for the selection of a more central yet affordable site that wasn’t bound by the constraints of the historic city center. After careful deliberation, a plot of land just south of Madrid’s Chamartín neighborhood was chosen—a vast expanse surrounded by ample parking spaces for fans, whether they arrived by car, bus, donkey, or bicycle.
Interestingly, the pattern of stadium construction in Europe differed from that in the United States. American stadiums often emerged in former industrial or port areas, where economic decline had rendered vast plots of land available for development. In Europe, however, many stadiums initially sprung up near the city center. As cities expanded, these stadiums gradually found themselves in prime locations, greatly increasing their value and providing an incentive for clubs to sell the land and build modern stadiums on the outskirts. A recent example of this is the rival club Atlético de Madrid, which sold its old stadium in 2019 for approximately 180 million euros.
In the case of Bernabéu and Real Madrid, the land for their new stadium was purchased in 1943 for a mere 18,000 euros—equivalent to 40 cents per square meter. Today, the average price per square meter for apartments in the center of Madrid is 5,292 euros. This staggering increase serves as a testament to the escalating value of urban land. While the average inflation rate in the Eurozone from 1943 to 2023 was 6.8%, the average annual increase in real estate prices amounted to 8.84%. These figures highlight the significant impact of inflation on the value of land over time.
The dynamic relationship between urban growth and land value is a result of the finite nature of space within a city. As cities expand and reach their natural limits, the cost of utilizing space inevitably rises. To cope with this, innovative solutions such as second, third, and even fourth layer developments have emerged. However, the ground can only support a limited number of upper layers, and logistical considerations further restrict the possibilities. As cities offer greater professional opportunities and attract larger populations, the demand for access to limited urban space intensifies, engendering a virtuous circle.
This process, commonly referred to as gentrification, has its detractors, as it often results in the displacement of long-time residents from their neighborhoods. Those unable to generate enough income to cover the rising cost of land usage are eventually forced out by those willing to pay more, driven by the expectation of lucrative returns. Santiago Bernabéu’s astute acquisition of land not only secured Real Madrid’s future success but also triggered a rise in surrounding land values, effectively giving birth to gentrification as we know it today.
As cities worldwide grapple with similar challenges, it becomes increasingly evident that the value of urban land is intricately tied to its scarcity and the economic potential associated with it. Santiago Bernabéu’s foresight and shrewdness, embodied in Real Madrid’s iconic stadium, have left an indelible mark on the urban landscape, reminding us of the complex interplay between sports, business, and the ever-evolving cityscape.
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About the author - J-S Tremblay
I've been involved in the cryptocurrency world since 2016 and trading since 2019. I started Moon and Lambo in 2021. I'm passionate about crypto and love to share my knowledge. I hate bankers and I hope that cryptocurrency will change the financial world for the better. View full profile...
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