The deal is not a bad one for the club. They get a bigger stadium without the large spending. They can sell the old one to pay of debts, albeit this might just mean the current owners getting reimbursed for paying off the debts.
The questions arise in the far future. What happens at the end of the lease? They will have nothing and will have to buy land and build anew or find somewhere else to lease. What happens if the stadium becomes unusable in 30 or 50 years? Are they bound by the lease to whatever replacement the authorities make, do they have to contribute to a replacement, or does the lease just end early, leaving with the problem of what next?
The leasing system is not necessarily bad, but generally not our tradition. Perhaps clubs like City and West Ham will start a new tradition of authorities helping more with stadium needs of local clubs. We saw how our threat to leave got Haringey more involved. How would Newham react to West Ham moving in the future?