Build it While they Still Come

Last week Gareth Parker wrote an excellent piece in the West Australian newspaper entitled “Stadium Sums Don’t Add Up.”

There is no doubt that nationally Western Australia is becoming viewed as no more than a country town when it comes to hosting top sporting events, and that is due to a lack of foresight and planning by both the sporting bodies and the politicians. Perth boasts some of the worst stadia in a capital city in Australia, and unless someone takes the initiative we will be like Adelaide waiting 53 years for teams like the Socceroos to set foot in Western Australia again.

As Mr. Parker stated in his article the sport that we don’t mention was effectively broke in the early 1990s, ‘the game was gifted a long-term lease to Subiaco Oval on a peppercorn rent to secure its financial future. Since then the ground has received two taxpayer-funded facelifts, the $11 million Roberts Road revamp in 1995 and the $40 million redevelopment of the city and northern ends in 2000 and football is the strongest sporting code in WA.’

This code of football’s cash-generating assets are the lease on Subiaco Oval – and the revenue from the naming rights – which is now known as Paterson’s stadium, and the licences for West Coast and Fremantle to play in the AFL competition.

As Mr Parker reported “Last year, according to their annual reports, West Coast and Fremantle generated about $46 million in operating profits from playing football at Patersons Stadium – a figure that does not include the $36 million the clubs spent on their football departments, coaches and players (player salaries, a seemingly contentious element in this debate, tallied about $8 million per club).They paid a combined $9.5 million in rent and royalties to the WAFC in 2010 – money that goes into junior, community and country footy. And as the WAFC’s 2010 annual report notes, 80 per cent of its revenue comes directly from Subiaco Oval.”

These figures make it abundantly clear why the code in control of the stadium is unwillingly to allow the other codes near its management contract. This writer raised this issue with both Alan Carpenter and Geoff Gallop when they were in state Parliament, believing it is wrong that one code of football should benefit from the success of another, with the WAFC receiving money from the Glory’s famous finals appearances at Subiaco Oval and the Western Force’s first three seasons.

The stadium issue is a big one, and it is one that will have a big impact on the future of sport in this state. Paterson’s Stadium has had as mentioned millions of tax payers’ money spent on it for what is essentially one code of football. That code has reaped the benefits and has taken full advantage of the state-owned stadium and held other sports to ransom because the Sports ministers of the time were and are too scared to rock the boat.

The Western Force had to move from Subiaco as their fans were talking with their feet and refusing to watch a sport that needs to be played in a rectangular stadium. Their rent per game went from $220,000 per game to $110,000 per game at NIB Stadium. But this move came at a cost as they were forced to spend close to $3million on upgrading facilities to meet SANZAR standards; an upgrade that Perth Glory benefitted from without contributing a cent.

The Force reasonably asked that these costs be offset against the rent but owners the Town of Vincent, and Allia Venue Management, who have the management contract for the stadium for another 13 years, declined their request. They lost $800,000 last year as a result, which is in fact a good return when you look at the expenditure.

The Government has committed to spend $85 million on the eastern stand at NIB Stadium, both of the tenants are still screaming because they say as long as Allia Venue Management hold the management contract they cannot make money, something that the WAFC’s record at Subiaco would confirm.

What must be taken into account however is that the owner of Allia Venue Management, Mr Nick Tana, was the man who underwrote the original redevelopment of NIB Stadium, and without his commitment it would still be a temporary rectangular stadium erected on a football oval. He bankrolled the redevelopment for the Town of Vincent, so is it not fair that he should make some money from personally taking that risk?

The government have suggested that Venues West be given the management of the venue if they can convince Mr Tana to relinquish his control, yet they have a poor record in terms of making venues pay and would appear to be a poor choice.

If this too is to be a government run stadium, why not bring in professional venue managers such as those that run Suncorp Stadium in Brisbane and other stadia throughout Asia and Europe to manage the venue, and for that matter let them have control of Patersons Stadium too?

There is a great bit of advice in all businesses and that is stick to what you know best. The Western Force is a rugby club with expertise in that area and not venue management. Perth Glory is a football club who also have no expertise in venue management.

The taxpayer will have to fit the bill of that there is no doubt, so therefore does not the tax payer deserve to have the best people running the stadium to ensure that they have a prompt return on their investment? The management contract should be put out to tender with the proviso that those teams representing the state be afforded the best rental prices to use the facility. Let the venue managers make their money by hosting concerts and similar events.

There should not be one stadium in Perth, but two, and if our current leaders continue to bicker about who should have control more delays will occur and by the time it is built we will have missed the boat. We may no longer have teams in national competitions to support. It needs strong leadership to drive this project forward; hopefully someone will emerge to fill that role soon.

Build it While they Still Come
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