Wenger can be an Arsenal figurehead for life

Arsenal's directors have admitted for the first time to having a degree of pessimism at one stage about whether their new £357m stadium at nearby Ashburton Grove would ever be built. But by finally agreeing £260m worth of loans from six different banks they now claim to have secured the future of the club, and of Arsène Wenger as manager.

Wenger, whose contract expires in 2006 just as the new ground is due to open, will negotiate his next one from a position of strength, knowing that the club want him to stay for life and have even considered him as a future chairman. He has agreed all along that it was unrealistic for Arsenal to stay at Highbury with its capacity of 38,000 (fewer for Champions' League games), and the fear was that he would be lured away by a club like Real Madrid before the new 60,000 stadium was complete, which would then lead to an exodus of players.

"We probably underestimated the size and complexity of this project," said Arsenal's managing director, Keith Edelman. "There are huge complications with regenerating sites in the middle of London. When you take giant strides forwards, which this is, there must be moments when you sit back and think, 'Are we going to get to the finish line?' It's certainly caused sleepless nights."

Ken Friar, who was Edelman's long-serving predecessor before resigning to work full-time on the project, admitted in his dry manner: "Eighteen months ago we were cautiously pessimistic about the future. But everybody just gritted their teeth and got going again. We had to win this one." Danny Fiszman, the other director most heavily involved, has called it his "five-till-nine job: five in the morning till nine at night".

With Wembley's costs escalating and clubs such as Leeds United in trouble after borrowing too heavily, the banks' caution was so extreme that they even explored the scenario of whether they would get their money back if Arsenal were suddenly relegated. They will do so, Edelman insists, as well as receiving interest payments of £15m a year on the 14-year loan. That outlay - the equivalent of a star player every season - is considered to be worth it once crowd capacity increases by almost 60 per cent, with much greater scope for executive boxes and corporate hospitality. Manchester United, even though they may possibly expand Old Trafford, will no longer be taking £1m more each match than their closest rivals.

Exactly 30 years ago Friar, as club secretary, was part of the historic meeting at which the boards of Arsenal and Tottenham discussed building and sharing a new stadium at Alexandra Palace. He later offered the GLC £162,000 for the site. Last Thursday morning he sat at the same table in the Highbury boardroom, as Edelman teased him: "Why didn't you do that deal? Think of the trouble it would have saved!" Not to mention the £357m.

But at that time Highbury still held 63,000, White Hart Lane not much less, and Hillsborough, the Taylor Report and compulsory all-seater stadia were more than a decade away. This time every possibility has been explored, including the two north London clubs sharing Wembley, which was considered unattractive financially and, ironically, too big for club football with its 92,000 seats. Having looked at some 30 possible sites, Arsenal decided that moving round the corner in Islington was the least-bad option.

"The driving force behind all this was that if we didn't move, we could not be a top European club for the next decade," Edelman said. "We'd have decayed. We could not stay at Highbury, keep our squad together and have significant funds for transfers. But this funding will enable us to ensure we have money available for a good-sized transfer budget. The first sign of that was the [Jose Antonio] Reyes signing, which we wouldn't have been able to afford to do had we been staying at Highbury."

So whereas the perception was that Wenger was handicapped by having money put aside for the new stadium, the argument now is that without the finance coming into the club he would have been in a worse position. To ensure that transfer funds are not drained away, a company separate from the football club has been set up and Sir Robert McAlpine has taken on the stadium construction at a fixed cost of £220m, with penalty clauses for any overrun on time.

But despite having already suffered one 12-month delay caused by overoptimism about the starting date, the club expect that in August 2006 they will have a quality team sitting in the home dressing-room and christening the Premiership's newest stadium - with Wenger. A stickler for detail, the meticulous manager has been as closely involved in planning as he was at Arsenal's unsurpassed training centre, and he likes what he sees. "He went round the site," said Friar, "and came back and just shook both his fists in delight."

That may have been the moment at which the directors realised that the fateful day when Wenger says au revoir could be a long way off. "We want him to lead the team out in 2006," Edelman added, "and we want him to be here for as long as he wants to. The chairman's even said he might be a chairman in years to come. He's got the intellectual capability to do it, which I think is very rare for a manager. And when you've built something you don't want to walk away from it. I think he'll be with us for very many years."