Private sector funding for stadium always in doubt

What does CST’s Malcolm Farry say now, you have to ask.

### ODT Online Tue, 28 Feb 2012
Doubts over private sector funding for stadium
By David Loughrey
The future of “private sector funding” for the Forsyth Barr Stadium may be thrown into question by the shock announcement last night the Otago Rugby Football Union (ORFU) could fold by the end of the week. Dunedin Venues Management Ltd (DVML), the Dunedin City Council-owned company running the stadium, has sold season tickets on the expectation an Otago team would play at the stadium in the ITM Cup.
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### ODT Online Tue, 28 Feb 2012
DCC in queue of creditors
By Chris Morris
The Dunedin City Council seems set to join a queue of worried creditors after confirming it is owed more than $400,000 in unpaid rent by the Otago Rugby Football Union. However, any prospect of a last-minute bail-out by the council appears to have been ruled out, with council chief executive Paul Orders and Mayor Dave Cull last night in unison about there being no city council plans to save the union.

Mr Orders said the Otago union had a “proud history” and liquidation would “clearly” have implications for the Forsyth Barr Stadium, although the extent of these was as yet unclear.

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Posted by Elizabeth Kerr


Filed under Construction, CST, DCC, DVL, DVML, Economics, Hot air, People, Politics, Project management, Property, Site, Sport, Stadiums

6 responses to “Private sector funding for stadium always in doubt

  1. Anne Elliot

    Great to finally see the Oddity put speech marks around “private sector funding”.

    Oddly, I posted one comment today and have been denied access to post any more.

  2. Hype O'Thermia

    What’s that about? What message did you get? Is it your log-in, doesn’t it accept who you are?

  3. Anonymous

    The ORFU situation is just a curtain-raiser for the DCC in about 2 years time. Very roughly, here’s what will happen (it is almost inevitable):
    – adverse $10-15M settlement in High Court judgement
    – DVML revenue fails to meet target, posts loss of approx $5M in 2012
    – DVML will be wound-up, stadium mothballed
    – Highlanders franchise leaves in 2013
    – debt-servicing limit breached in 2013
    – DCC forced to post 10-15% rates rise in 2013
    – Commissioner appointed and Council dissolved prior to triennial elections

    If the new CEO has his head screwed on (and I think he does), then DVML cannot survive past the end of this year. With no rugby in 2013, it can be opened only for major events and remove a huge amount of operating cost.

    At least the stadium is only “in danger” of becoming a white elephant. Some of us thought it already had that status:

  4. Phil

    That’s the trap that everyone is caught in now. Of course the ORFU know how much it is going to cost them to rent the stadium for the day. I refuse to believe that it was never mentioned during their discussions with the stadium operators. Don’t believe that for a minute. In not signing up as a tenant, they are subject to a game day hire rate.

    The stadium wasn’t going to make any money out of ORFU matches at the agreed rate. Now the tone has moved to the ORFU requiring a further reduced rate. Making the loss to the stadium, and the ratepayer, even greater. It’s ironic that the stadium will lose less money if it stays closed on game day than it will if it opens.

  5. I can’t believe I’m saying this but…..
    It would be cheaper for -us- DCC to just donate the money to orfu. Just hand over the 2+ mill and be done with it. Then they could pay all the LOCAL people they owe, including -us- DCC and that stadium.
    Tell nzrfu to piss off with all their ‘financial models’ that don’t work unless your scalping the public like they are, then get to paying for the lemon.

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