After Alinghi’s victory in the 2003 America’s Cup, an effort began to change the rules of the competition. A key goal was to improve the process by which each year’s challenger was chosen. It was hoped this move would turn the Cup from an esoteric series of matches, only understood by a tiny minority, into a major spectator sport, with all the commercial potential that involved.

In practical terms, this meant introducing full-fleet racing to choose a challenger rather than relying on the traditional one-on-one contests only – eliminating the duplication and confusion that arose under the previous system, where, effectively, two separate competitions were held.

“The two events were usually completely independent, resulting in duplicated effort and, at times, frustration or confusion for partners, participants and spectators alike,” explains the competition’s website. Also, the dependence on matches made it difficult to sustain the interest of spectators – especially newcomers to the sport.

To overhaul the system, a new company was created. Previously, each competition was organised by the previous winner. Now, an independent company, America’s Cup Management (ACM) was established to act as the governing body, with responsibility for logistics and commercial interests.

For Ernesto Bertarelli, the man behind Alinghi and ACM, the priority was to create a string of events between each America’s Cup contest – held every four years – to sustain public and commercial interest. Also, since Alinghi’s home was Switzerland and lacked a seawater port, another venue – the first in Europe since the original race – had to be found.

Led by Michel Bonnefous, a childhood friend of Mr Bertarelli’s, ACM combed more than 60 potential locations. In the end, it came down to four: Naples, Lisbon, Marseilles and Valencia. All offered a mix of merits such as wind, attractiveness and financial backing.

The Bay of Naples has an unforgettable backdrop in the shape of Mount Vesuvius and was widely supported by many who had sailed there. But it was feared the strong south-westerly winds could cause choppy waters. Marseilles has many attractions, with three different types of principal wind and a rocky headland, which gives shore-based spectators good views. There was also the potential to build Cup facilities in the city’s famous old town. Lisbon, meanwhile, has reliable winds of 12-18 knots on over 300 days each year. Also, Portugal has organisational experience and a cheaper cost of living than its three competitors.

However, in November 2003, Valencia emerged as the winner. On paper, Spain’s third-biggest city seemed no more compelling than the others. But a daily sea breeze in the summer months was expected to offer reliable sailing conditions. That was a major factor in a competition keen to boost its popularity, since television coverage is unforgiving of interruptions.

But it was probably Valencia’s financial commitments that clinched the decision. Officially, it pledged to invest €1bn in infrastructure, and many believe the real expenditure has been much bigger. It seems that the city was prepared to do anything to outdo Barcelona, its bigger neighbour to the north.

Valencia proposed a massive scheme to spruce up its huge, but grimy, commercial port by building a special area for the America’s Cup teams. The project included a new canal to give the yachts direct access to the sea, without first, as in the past, having to trudge past the tankers and freighters at the commercial berths.

Anyone returning to Valencia for the first time after a long absence will be astonished by the transformation. Most striking is the new Port America’s Cup, which includes team boathouses and a lavish public relations and visitor facility. The new port has also prompted significant redevelopment in the surrounding area, in the form of hotels, apartments and a 700-berth marina.

However, for all the city’s efforts and attractiveness, the selection of Valencia has had some negative consequences. Some believe the choice played a part in the clash between Mr Bertarelli and his skipper, Russell Coutts. The New Zealander was widely believed to prefer Lisbon, because of its keener winds. Although the choice was only one ingredient in a cocktail of differences, it may contributed to the eventual dismissal of Mr Coutts.

The issue became more contentious last month, when unusually windless conditions seriously disrupted some of the early regattas. Valencia may be lavishly equipped for this year’s Cup, but it remains to be seen whether the local weather will vindicate its selection.

Haig Simonian is the FT’s bureau chief in Zurich