Economic Impact

As stated there are two broad areas that I wish to comment on with regard to the stadium. Without a doubt the majority of the complaints or concerns surrounding the proposed stadium have been surrounding the economics of the project.

There is no doubt that the critics have issues with ratepayer burden, while others have fears that the council has stretched itself too far, while others have expressed concerns about the possibility of a recession having devastating consequences for the council.

While on the other hand, proponents are understandably bullish and while not exactly painting a picture of the streets paved with economic glory, they are understandably up beat about the prospects for the stadium. These protagonists also see the potential for peripheral development of course having a positive spin off from the development.

Whilst there has been much written about the subject of stadium development, I have endeavoured to cover those published that have a more direct relevance to our situation in Dunedin. While it is easy to see the impact that the likes of the Wellington ‘caketin’ stadium have had on the economic and social environment in Dunedin around the times like big rugby games and events such as massive concerts. We can look to the literature available to see where else this has happened, and what cautionary tales are available for us to learn from.

Although less apparent through the fog of other issues, is the possible impact of increased tourism through stadia development. Calvin Jones (2002) of the Cardiff Business School looks into the impact/costs of ‘national’ stadia development in the UK and US, where there is often huge public injection of funds, while many of these stadia are privately owned. Jones points out that in recent history, development of stadia was often linked to central and local government urban regeneration and infrastructural development. While the evidence suggests that the economic benefits of such development occurs unevenly across the population. And as rightly demonstrated, the burden of costs for development shift from team owners (the likes of the Otago Rugby Union) to the councils. Jones also discusses the national or local pride that comes from hosting major events within new stadium. As Jones points out however, linking stadium construction to tight deadlines has a negative impact on the ability of all parties to fully debate the issues, and proposals like the Stadium of New Zealand proposed for the Waterfront in Auckland have very intensive and heated debates, often at the detriment of reasoned and informed debate. As Jones suggests, if the Stadium of New Zealand proposal wasn’t so dependent on the tight time frame of the Rugby World Cup which NZ is hosting in 2011, then the potential for the project to go ahead may have been improved, as all issues of economics, design and the social would have been more roundly discussed. This is where I see a point of distinction between the Stadium NZ and Dunedin Stadium. In the Dunedin case, there has been much more time to air the initial knee jerk fears and euphoria, and more reasoned and informed debate has ensued (not to everyone’s liking on both sides).

Jones also illustrates where the likes of the Cardiff, Wembley and City of Manchester ‘national’ stadiums are linked to a physical regeneration, which through increased media attention, business development and visitation numbers, which results in economic regeneration. One of Jones’ greatest concerns is the use of public money for private gains. And while he points out that the City of Manchester stadium is the only one to take public money to stay in public hands, there is an inevitable stress between commercial imperatives and the perceived public uses for stadium. This is of importance for the Dunedin Stadium, in that there is a massive injection of public money, into what could be perceived as primarily a private stadium. One of the main concerns illustrated in the UK example is the economic impact on the existing business in the area. As the area to be designated in Dunedin is in primarily in an industrial zone adjacent to public land, there are valid concerns of land purchases etc. However the likely impact on any retail or service industries (café’s etc) within the area are probably negligible, as this area is sparsely used by classic café clientele.

As Jones points out, the comparisons to be made between private professional teams occupying publicly developed spaces in the UK and US are difficult, as ownership issues are vastly different. In the US, the massive economic clout of national professional sports teams, such as a pro Basketball, Baseball, Ice Hockey or American Football team are evident. Unlike the UK (and to a certain extent NZ) in the US a sports team is the name, and they are essentially franchises. There are numerous examples (including modern) where a team owner has relocated that franchise to another city (or state and even country – between Canada and the US) where the local council has agreed to the economic use of public money to build a facility for private use. In many cases the civic pride that accompanies a city hosting a major professional sporting team stems from the national exposure that city gains from the sporting media. There are instances where the by declining the development of stadia for private sporting teams, there has actually been a positive economic impact on the local community. There is no doubt that in Dunedin, the economic strain on the city with the go ahead of $91.4million dollars invested, has potentially compromised other developments. This is yet to be seen, while the bullish economic prospects of the development are yet to come to fruition.

While the prospect of ‘franchise flight’ is slim to non-existent in our case, in the US this is of major concern when the debate of public money for private stadiums and democratic accountability are discussed. However, in New Zealand, ‘event flight’ is evident and a potential issue for Dunedin. The most recent example of ‘event flight’ has been Christchurch securing the rights to host the most Auckland of institutions the Ellerslie Flower Show, which of course will now need a new name. In the case of the stadium of Dunedin, it should possibly the case of which event(s) should we look at hosting or stealing from other regions. One could suggest the magnificent growing and presentation possibilities of a fully enclosed stadium, like ours could suggest that the National flower show could migrate even further south?

On the whole, Jones is cautionary in his views of the se of public money for large scale economic and sporting developments. However given the obvious points of difference between team ownership and stadia location and development between NZ and the US in particular, many of his concerns seem to be of little relevance to US.

Other studies such as that by Sullivan (1998), also point to the link between stadium development and civic pride, which one could argue is of major importance in the development of the stadium of Dunedin. Although less directly relevant to NZ, Zimbalist (1998), also points out the competitive nature of hosting a major league sports team, the civic pride which ensues and the competitive games that are played off between cities competing for sports franchises. Although in the future it is possible that Dunedin could host another professional sports team which would require the use of the stadium, this is possibly too far off to need serious consideration at the present.

More recently the economic impact of stadium development as discussed by Santo (2005) issues some precautionary notes, while extolling the positive impacts on the process of stadium construction. As Santo points out“ the recent wave of stadium construction has been marked by a migration of such facilities back to the urban core with an emphasis on revitalization and tourist appeal.” This is of course of more relevance to the Dunedin case, with the potential for tourist dollars, coupled with the economic and physical development of this area not too far from the heart of the city, particularly as it is located on the waterfront between the Port and the City (on a major road and rail link).

This is where the design of the stadium comes into question. As Santo states “it is not the sport activity, but the context which is key. Theoretically, a retro-style ballpark in a downtown or retail setting is likely to attract visitors from a wider area than its more utilitarian suburban counterpart, and is likely to induce longer stays and greater ancillary spending. If so, it is plausible that the new generation of sports facilities would have more favorable economic impacts than their predecessors”. Although the Dunedin Stadium thus far has been designed by possibly the leading designers of stadia globally HOCSports, there is no question that the likes of the gaudy ‘retro’ baseball stadiums which have been constructed in the US. Thus the likelihood that the Dunedin stadium would foster longer stays than say the now defunct National Stadium on the Waterfront in Auckland, is negligible. It could be argued however that the utilitarian nature of the events housed within the stadium will foster the longer of stays within the city for sports or event tourists. Santo goes on to apply economic models to this thinking on stadium design.

As Santo states, previous economic modeling indicate (as seen in Jones 2002) that the economic impact of sports stadium development is negligible and often seen negatively. However as Santo states, these models are based on economic assumptions of very different economic times on buildings of vastly different design, “The stadiums of the recent construction boom have been built amidst a very different context than those of the previous generation.” Santo argues that new thinking must be applied to economic modeling of sports stadiums constructed presently.

Jones, Calvin. Public Cost for Private Gain? Recent and Proposed ‘national’ stadium developments in the UK, and commonalities with North America. AREA (2002) 34.2. 160-170

Sullivan, N.J. Major League Baseball and American Cities: A Strategy for Playing the Stadium Game. Policy Studies Review Spring 1998, 15.1

Santo, C. The Economic Impact of Sports Stadiums: Recasting the analysis in Context. Journal of Urban Affairs. Vol. 27/No. 2/2005

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24 Comments

Filed under Architecture, Design, Inspiration, Media, Stadiums

24 responses to “Economic Impact

  1. Peter

    Like your blog on the stadium. You might be interested in checking out the Dunedin stadium thread at skyscrapercity.com. Just look under OZ/Kiwiscapers section.

  2. Peter Entwisle

    The Cardiff stadium and the proposed Stadium of New Zealand on the waterfront in Auckland are both national stadia in much larger population centres than Dunedin. The more protracted discussion in Dunedin has only had the effect of revealing the uncertainty and modesty of the benefits over the costs and negatives of the proposed Awatea Street stadium.

    While siting a stadium at Awatea Street won’t hurt many cafes or perhaps even other businesses in that area taking sports events from Carisbrook will depress a depressed area still further.

    Santo’s point that recent retro-style stadia in old urban centres do better than functional ones in suburbs – in terms of tourist appeal – suggests a retro redevelopment of Carisbrook would do better in that regard than the proposed functional stadium at Awatea Street which is on the fringe of an urban area.

  3. Sorry Peter,

    but apart from a couple of Bars and a few Dairies which sell pies galore, I seriously South Dunedin could do without a big ugly stadium there.

    The nature of Carisbrook is insular looking with only the odd voyeuristic glimpse from the Scotsman Stand areas. But apart from that it puts a big ugly face to the area, overshadowing the neighbouring houses with the menace of the old Hammer/Teacher from the animation sequence in Another Brick in The Wall. That whole block is ugly and needn’t be.

    I think both parts of Dunedin would be greatly improved with the Awatea Stadium going a head.

    Forbury Park on the other hand is one building that if I won Lotto would get all of the spare money I had after the mortgage was paid off. Apart from it being in a serious state of disrepair, it’s still retained the charm of the old design. Carisbrook has add-on after add-on look about it, with scant regard to any form of architectural integrity. There is nothing about Carisbrook that is old/interesting or inviting. Forbury Park however almost draws you into it, you want to know whats behind that beautiful but now old and decrepit exterior. The lack of walls and open doors always draw you in. I could just stand down there any day and imaging the fun and excitement of yesteryear, the Interdominons and other great days in the sun with the gee gees.

  4. Peter Entwisle

    Neither Forbury nor Carisbrook is a visual highlight. With respect I think your preference for Forbury is only personal. Both are historic and both are capable of redevelopment and unlikely though this is in the existing climate, it’s possible to turn Carisbrook into something amazing. That may not happen but if you want to stare an ugly future in the face have a look at the CST’s latest vision for Awatea Street.

  5. Peter Entwisle

    Afterthought. You say “a couple of bars and a few dairies” are the only businesses around Carisbrook which profit from its activity. In fact there are a number of motels many more than two pubs and many retailers in the area report increased takings when there are games. There are no pubs, motels or retailers around Awatea Street. Even with the zone change there probably still won’t be because the adjacent land is either industrial, or sports reserve – Logan Park – or occupied by university and polytech faculty buildings.

  6. Paul Campbell

    The test last weekend apparently “filled all accommodation between Balclutha and Oamaru” – the new stadium, if built, will have fewer seats than Carisbrook had last weekend – so, at least as far as major tests are concerned, it will have no net economic benefit over the existing stadium (actually it will probably be ~10% less because of the fewer seats).

    In reality big tests are a red herring, they’re going to fill what ever space is available – the big problem is the economic viability of the local rugby team – the problem there is of course is that not enough people are going to the normal games – and the real reason for that is that they’re now being held at night rather than in the afternoon – mostly because the rugby unions got greedy and caved in to Sky for the Aussie TV market.

    The days of the local amateur rugby union fielding locals who represent us are long gone – the ORFU is a business and needs to stand by the results of it’s business decisions – if they decide that they can make more money from Sky than from local spectators then that’s their choice, and they can’t come complaining that no one’s coming to their games and that they need a covered stadium to fix it.

    As I understand it the ORFU currently owes the city $1-2M with no chance of repayment in sight (it’s all rather murky so it’s hard to tell what’s really up with this stuff) – whatever the situation we should not be rewarding their poor financial stewardship by mortgaging our future and throwing a huge white elephant at them. Instead if we are to build a new stadium we should 1) make the Rugby Union pay up their debts to us first 2) make them sign on the dotted line to play a certain number of games per year for the next 15-20 years

    We shouldn’t be building a stadium if it’s not going to be used and if the ORFU is in such a shaky financial state that it will not survive to make good use of a new stadium there seems little point in throwing away all this money

  7. Paul Campbell

    One other comment about the economic impact …..

    Even though I was born in Dunedin and have returned to raise my kids here I lived in Berkeley and Oakland California (across the Bay from San Francisco) for 20 years. A few years back some of the Oakland City Council decided to try and lure back their football team from LA by spending up big on their aging stadium.

    This process was going to to be largely funded from private industry mostly by selling rights to luxury boxes with the city picking up the slack if anything went wrong (sound familiar?) – needless to say the .com bust occurred in the middle of this, no one wanted to spend up big for boxes, of course the costs ballooned and the city got stuck with the bill (a bit like the current economic downturn ….).

    Now in Oakland, which is not the most affluent of cities, this meant that city-funded homeless shelters had to close and families ended up homeless on the street

    I used to think that something like that couldn’t happen in Dunedin – but then there was that article in the paper a while back about the city no longer having the funds to help poor people with their heating bills ….

    So I guess the main reason I’m against the stadium in Dunedin is because I’ve lived in a city where a stadium was pushed through with many of the same arguments we’re seeing today, and pushed through the process in much the same way that this one has without public hearings or any sort of city wide vote on the issue – and one that failed in just the way that the critics at the time warned it would leaving us (and particularly the most vulnerable or us) holding the bag

  8. Paul,

    thanks for the input. As you know I have discussed the US comparisons, however they provide little of reference to our situation, other than throwing up half issues.

    As you will very well know the situation in the US is very different with virtually every major sporting team in which ever code they may be, are owned by private business or in many cases single wealthy individuals. In New Zealand we are the complete opposite of this, every major team is owned either indirectly by the people or is seated in a regional context.

    I could have included a plethora of material on US sports teams and stadium development. One afternoon in the library at UBC (Vancouver) gave me more than enough material, however it also hilighted vastly different issues.

    One for instance, is that in the US, if the stadiums are publicly funded, as they quite often are, any profit from the teams will more or less go straight back into the pockets of the likes of Paul Allen of the Mariners (one of the richest men in the world – co-founder of Microsoft). While building a stadium also doesn’t guarantee that the franchise (that’s what they call a pro sports team in the US) will stay in the city, this bebate fills page after page in the literature. The Montreal Expos, were relocated to the nations capital, Washington (didn’t even stay within Canada), a move that was controversial at the time. And there are numerous examples of teams holding the threat of relocation over civic leaders for want of public money to build essentially a business it’s plant and infrastructure. I am all for cities trying to help out private enterprise, but would Dunedin ever consider purchasing Fisher and Paykel a free brand new state of the art factory just to keep them in the city – no thankfully.

    Back in Dunedin, the stadium will be built with public money, but then that money will be paid back over time, and the city will reap the rewards of more test match rugby, The Phoenix visiting, international football (soccer), the odd concert etc etc, not single individual owner(s). It’s not as if this money is lost forever as in the case all across North America.

    Also corporate boxes in any major US stadium are significantly more expensive than any corporate boxes in Dunedin, no comparison. Plus there is a lot of ‘old’ money here, no flash larry .com money, just look at the tenants of the current boxes, bugger all start-up companies there.

    As for city wide vote on the issue, I really have to take you up on this. The single most volatile issue at the last election was the Stadium. I voted for the candidates who were pro-stadium, and as a whole, those who have done the analysis of the voting patterns, showed that there was more or less a clear line between those vocally opposed to the stadium being ousted to those vocally for the stadium returning some of the biggest vote counts. The people were well informed by the time the vote came, they knew the issues and the likes of the Syd Ade got exceedingly disproportionately high air time and column space in the media.

    Building a stadium, will not prevent people from putting food on the table. The council is not responsible for the social security of the people, that is the role of the state within NZ (unlike the US). Sure some people will pay in rates, which they are already finding hard to manage, but that’s another whole issue – you do not hold back from economic development in times of perceived or real slow down. The poorest people in Dunedin will not be left holding the bag, as you know it is the rate payers, not renters (whom are the majority of the ‘poor’) who will pay for this. Some landlords will pass this cost onto their tenants, some will not. Because in a renters market those who set their rents high, fail to fill their houses.

    In short, we can always learn from the positives and negatives similar developments provide from around the globe. Just in this case, although the obvious easy comparison to draw is with the flood of new stadiums across the US, it just provides little or real substance from which we can learn. The examples from Germany, France and the UK provide more in the way of public money and public good with regard to stadium construction.

    I’ve also got to take issue, with a couple of other points. The new stadium will have slightly less capacity, but room for temporary seating which will bring it’s capacity up to that of Carisbrook over the weekend, about 30,000.

    Also there is evidence that new stadium attracts wealthier supporters, whom will stay at the likes of the new Hilton, so the economic benefits in from these singular events will quite possible be greater.

    As for the rugby issue, there is talk about the young players whom will come to Otago Uni, try to play for Otago if the stadium goes ahead. I can not name my sources, but this is very real talk about the place. But if we are to talk about rugby as the only tennant, or focus on them alone, we are going to doom the development from day one. There are a multitude of sports and events which could be lured here, there is even talk of a mini Big Day Out. Why not, once again we are only limited by our imagination and the incompetence of those running the place.

  9. Paul Campbell

    I’m very familiar with Paul Allen – I work for him (or rather one of his companies even though I live in Dunedin …)

    It’s my understanding that Rugby was now a business (remember I moved away for 20 years) – are you saying that the ORFU’s shares are owned by the city council?

    I carefully read all the candidate’s statements, I could only see one guy who explicitly said he was in favour of the stadium (I don’t think he got elected) – there were a bunch of people who were against the stadium running – they formed 2 parties and split the vote, some got elected, some didn’t.

    In reality I suspect there were a bunch of people running who were really in favour of the stadium but didn’t put that in their candidate statement, but put it out to stadium supporters what their real agenda was – which probably explains the two sides different take on the result of the election

  10. What I am saying, is that the ORFU is an affiliated Union of the NZRFU, and only professional in that it must produce an income other than funding from the RFU. The ORFU is not owned by a singular individual whom at his will could up shop and move to sunnier locations (Tauranga for eg). The Otago Rugby Union is based in Otago. Unlike the Seattle Seahawks in the US (good team), where the franchise operated under the NFL banner is the Seahawks, which are based in Seattle, but do not belong to the team. Come on Paul, you lived there you know how this operates. Although Rugby has undergone many changes in NZ, the only real difference is that players get paid and rugby is broke (with all those TV rights I don’t know how). Not much else has changed.

    Paul, the candidate statements were wishy-washy rubbish. Many many people (or anyone interested in the debate) were following the papers, and it was obvious who the main councillors who were against the stadium were, they were the most vocal, and they were re-soundly beaten. Add to that the position of most councillors was clearly spelled out in the media (ODT) in the weeks and months leading up to the election. The ODT did a big 3 page summary of all of the councillors stance on a number of issues around the city. Any slightly informed voter knew who was for what before the election, and if you didn’t it’s called uninformed and you got what you deserved. That’s democracy. I don’t just read the policies of the political parties to know what they are up to, because policy statements are just signalling intent, you always get a fuller story from a variety of sources including the media.

    But although we are talking about Rugby, they will be the major tenant, they aren’t the only ones signalled to use the place and unfortunately people like Syd have thrown up that smoke screen all too often. It’s not a stadium for the ORFU, it’s a new Dunedin stadium which the ORFU will be using. This is a good thing, unless you have a rock solid product, diversity in product is just sensible marketing/business acumen.

    I will assume someone will come back with, “Well just what will be in there then”. Short answer is I don’t know, but then I don’t want to know everything. Did the Museum signal when it was redeveloped that it would outline every exhibition coming up, and the inclusion of the new Butterfly enclosure? We can only assume that whoever will run the place, will want to keep their job and get the best possible use for the building.

  11. Paul Campbell

    You know I read the ODT pages too – there were few people who came out on either side, mostly the people who were standing against the stadium – as far as I could tell most of the incumbents waffled on the issue and didn’t really answer the question

    Now they’re politicians trying to get elected, they don’t want to alienate possible voters on either side, it’s SOP in politics and I understand that – but if you go that way you can’t come along later and claim a mandate.

    Having returned from years in the US I relished the chance to vote again and spent a lot of time trying to be informed, read everything I could get my hands on – I found few candidates who were completely in favour of the stadium (mostly one guy standing out in South Dunedin who didn’t get in). What I don’t have is a history of the various councilor’s positions over the past decade or so which I guess could have given me more subtle insight into their pronouncements

    As I’ve said before I think that there’s a real disconnect in the community around what the election meant what the councilors were standing for – you may have.

    As I understand from recent ODT articles Rugby wont be a ‘tenant’ in the normal sense, they’ll rent it game by game through some management company, they wont be signing a lease

  12. Anne Elliot

    You are right, Paul, there is no anchor tenant that has come forward for the proposed stadium. The second largest slice of projected revenue is to come from – car parking! Perhaps the best way “to help the university” would be to build them a parking building. If a plan change to permit that activity was sought, perhaps it could include as permitted activity the odd cafe or restaurant for a more convivial atmosphere. See, no real need for a stadium, too :-).

    Anne Elliot

  13. Paul Campbell

    Car parking? but there are what? 100 parking spots there? I bet every player will be getting one for free – someone else suggested they’ll have to be using clown cars

    Getting 30,000 people down there by bus will be interesting, maybe 75 people per bus if we crush them in? – 400 bus trips – at least Carisbrook is serviced by frequent scheduled services – I bet they’ll have to take buses out of regular service to make those 400 trips

  14. Anne Elliot

    Paul, what do you mean when you say, “I bet every player will be getting one for free”?

    There will hardly ever be any players there as no anchor tenant has come forward and the stadium is expected to be used at the most up to 16 times per year for rugby. That’s not a lot of player parking.

    Anne

  15. Meg Davidson

    Compie said: I will assume someone will come back with, “Well just what will be in there then”. Short answer is I don’t know, but then I don’t want to know everything. .. We can only assume that whoever will run the place, will want to keep their job and get the best possible use for the building.”

    Compie, don’t you think you and other stadium supporters ought to concern yourselves with realistic projections of use for the stadium? The CST sure haven’t, and someone has to. Do you really think it is a good game plan to spend nearly $140m of public money on a stadium and leave it to the poor sucker who runs the place to find people to use it, and sack him if he can’t?????

  16. Meg

    I don’t have the development plan or am privy to it, but as far as I am aware they have done due diligence / economic impact on the project, and am not looking to build a stadium that will loose money. Does anyone set out to run a business that won’t work? I don’t think so.

    Do you seriously think that the respective councils are going to give them $140million to build an empty shed. If you have that view of it, you have a rather defeatist view of the development. Further you have a low opinion of our councils, or if they are giving out millions of dollars to ventures that are going to fail, I’ll put a business plan together tonight and head down to the council offices first thing Monday morning. I always thought there was a market for coloured swimming pool water…

    Come on Meg, councils don’t give out this sort of money to ventures that have a greater than average potential for failure, and neither council is taking this development lightly, or it would have been rubber stamped this time last year.

    It is critical that the ORFU is a main tenant, but then, like any operation in the entertainment business, it needs to be fluid, it needs to respond to changes in economics and other factors. It is not the role of the developers to do this, it is the role of the management team.

    As I have stated, I run this blog so that I can draw examples from around the world, to see what can inform good decision making and what we can learn from other similar situations. I look to the failures of the old Millennium Dome and the transformation into the O2 arena and then astounding success of that. I look to the design and planning decisions of the other developments around the world to see what processes they underwent to get to where they are here.

    For me, one of the biggest things I can take from being human, is to be critical of what others are doing and to learn from their success and failures. If we look at the failures of the Millennium Dome (that beautiful big tent in London) and how management turned it around as The O2 into one of the most successful entertainment arenas in the world, we can see what (even on the small scale of Dunedin NZ) is worth avoiding, and what is worth copying. Nobody of any worth has ever to try to reinvent the wheel, they have however tried to refine and improve on it.

    And these are not unrealistic thoughts.

  17. Paul C

    “Getting 30,000 people down there” will be the same as getting 30,000 people to any stadium anywhere in the world. It won’t be interesting, it will be just a matter of fact. How many people actually take a scheduled bus service to Carisbrook to see a test match, and when that once half hourly bus has been by, how many people wait for the next bus.

    You people are just being a little too disingenuous with your observations. If you haven’t noticed, there are chartered busses, taxis and the hordes all walking to Carisbrook, this will be the same at the other end of town.

    The new stadium’s location is also it’s greatest strength with regard to getting people in and out of there, with a train line running right by it. Get the Taieri train parked in town, fill it up and make as many trips as it can to the ground. Put a band on one of the carriages and turn it into a fun thing. Then at the end of the night get the opposite happening.

    “I bet they’ll have to take buses out of regular service to make those 400 trips”

    It’s all just negative isn’t it. Why (once again) with the option to be positive or negative are you folk always looking for the negative. I’d be happy with critical, but this is just silly. Come on, people travel all the bloody way to Vineyards to watch a concert, they can certainly walk the distance to the new stadium

    Octagon to Carisbrook = 2.4km
    Octagon to Awatea St = 2.0km

    Given humans walk 2.5km/hr, it will take about 12mins less to walk to the new stadium, through much nicer scenery than it was to the old stadium.

  18. Meg Davidson

    I vote Compie for stadium manager. I’m sure he would do a fine job.

  19. Peter Entwisle

    Compie, you say you aren’t privy to the development plan. Others are. The CST presented such a plan which was peer reviewed by others. Part of the doubt about the proposal comes from those reviews. They expressed serious reservations about much that was in the plan and pointed to the significant number of “exclusions”, things which had been left out making it difficult to assess the real strength of the proposal.

    The CST’s figures put annual operating surpluses at only about $300,000 without looking at the cost of servicing the capital tied up in it. $300,000 pa on a $188m facility, and that on doubtful projections? This is not only not a business proposition – it’s not being suggested as that – it’s not good spending on a public facility because the “public good” and downstream economic benefits don’t justify it either.

    I think the councils have been a bit cautious – hence the conditions attached to their support. But they’ve already voted $11.4m of public money – much of it now already spent – to investigate this and develop the plan, for fear of appearing too “negative”.

    They could get to a point where they’ve spent so much they’re afraid to press the eject button for fear of being accused of wasting the money they’ve already spent.

    This is the stuff of which real-life public spending disasters are made.

  20. Peter Entwisle

    Compie, I agree with you about the buses. If the Awatea Street stadium was the only stadium in town, and if the NZRU let us have a big match there, people would get to it somehow. More or less as they now do to Carisbrook – as you so rightly observe.

    But the CST itself says 20 big matches a year at Awatea Street wouldn’t justify it as a use for public money.

  21. Peter Entwisle

    Thought for the day: in 1884 the Russians advanced into Afghanistan. This led to a tremor of fear through the British Empire. Afghanistan is the back door to India. The Russians might continue their advance there and further – to remoter regions of the Empire. This led to the construction of massive defence works for the four main harbours of New Zealand – the Waitemata, Port Nicholson, Lyttelton and Otago Harbour. Here a large Armstrong Disappearing gun was installed at Fort Taiaroa – what we know as Taiaroa Head. There were two others commanding either end of the Ocean Beach – the long strand we know as St Clair and St Kilda. There were extensive underground tunnels, stables and other gun emplacements – all constructed at the public expense. The cost was about 120,000 pounds sterling. No Russian fleet ever came. Those guns were never fired in anger. There’s now only one left, the one at Taiaroa Head. In the whole of the 19th century about 40,000 pounds sterling was spent on buildings for the University of Otago. Imagine if the money for the defences had been used as an endowment for the university. By now it might be a lot nearer the standing of Harvard in its ability to fund research and hire the best talent. It isn’t a bad university – it’s a very good one. But it could have been a whole lot better if that money hadn’t been wasted.

    I recommend a visit to the disappearing gun. It’s not only fascinating Victorian technology, and there’s excellent views both under and overground. But it’s also striking testimony to the spectacular misuse of public money.

  22. Cheers Peter,

    been to the gun many times, it’s a fun little afternoon out.

    The world of 1884 is so different from 2008, we can only place that in context of historical military response. It offers little for the vision of Dunedin in the modern world. We could look at other areas where public money has been misspent, history is littered with this, just as it has been with private money. Life’s passages and choices will always be viewed as easy through the looking glass of time.

    It’s also a little disingenuous to compare Otago with Harvard with ‘what-if’s’. Harvard has an endowment of over $35Billion USD, an endowment of even 1% (US Dollars) of that Otago could only dream about, even if we saved every penny from 1884.

    But then lets turn that on it’s head, and say, what if (playing a futuristic counterfactual game). What if the stadium is a success.

    What if that area of town is transformed?
    What if the extra business income and hence rates?
    What if we had extra bed occupancy nights?
    What if there was increased airport money from extra flights,
    What if the Taieri Train/Tram business became more prosperous?
    What if there was an increase in people through the doors of the sports hall of fame after getting off the train/tram from the stadium, and one would presume Chinese Garden, Settlers Museum, Otago Museum would all see greater numbers.
    What if cafe’s were developed there and they employed people and more rates income was generated?

    What if simply it was a success because many people worked bloody hard to make it so. What would happen, well rates would be more stable, the council would have increased income, the city would be more prosperous, business would thrive, we’d be sending a message to the world, come here we look to the future.

    If faced with the prospect of looking at one’s naval and thinking ‘nah too hard’ and ‘not my money’ or looking to the inner harbour and city vibrancy and thinking, what if… I know which one I would go with any day. It’s equally valid to say what if rather than we can’t or we shouldn’t.

  23. Peter Entwisle

    Depending what you did with it, though not by saving it, you could turn 120,000 pounds sterling in 1886 into US$35b today. However that’s not what I was saying or implying. One could have certainly provided the means to improve Otago University so that it was “a lot nearer the standing of Harvard” than it is.

    Sure the world has changed since 1884 but I take it you recognise it’s still possible to waste huge sums of public money on unproductive projects at the expense of other opportunities. This is the complaint about the Awatea Street stadium, that it would be just such a lemon.

    You ask, what if the stadium is a success? Well, if it were, ex hypothesi, all sorts of good things would follow. But this doesn’t address the reasons for supposing it will fail: it won’t be used as much as its proponents claim; it will cost more; other uses of the money would produce more public good and downstream economic benefits.

    To make a persuasive case you have to somehow counter these claims. So far no-one has. The stadium, if it went ahead would be likely to be another disappearing gun.

    The thing about asking What if? is that it’s possible the question may be answered. Such answers aren’t always positive and one needs to be able to acknowledge that.

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