AFL likely to buy Etihad stadium in the next 12 months - Brian Cook

[Tas]

no Essendon got a deal because their CEO signed a better deal on the Clubs behalf. the poorer clubs, had the AFL sign deals. north didn't have to leave the MCG

We didn't have to leave, but our decision to leave was on the basis that the AFL offered us a significantly better offer to play there and they had to get teams to play there one way or another to meet the game and crowd requirements. The folly of the smaller clubs is that they did not get a guarantees in writing that the AFL would and the stadium manager would meet the 'conservative' estimates and the ground would in fact be subsidised.

We really shouldn't have to be worried about getting ripped off by the commission that is engaged with looking after the competition and the clubs.

 

[Tas]

Not so sure Essendon's deal is inherently THAT much better, more that as they sell out the ground regularly, they get the 'bonus' of selling a lot of reserved seats that for other home clubs would be GA/let's hope we sell them on the day.

I don't think the reserved seating money goes to the stadium. I don't think it had to do with the crowds, Carlton was writing cheques to Docklands for crowds over 40k, as was St Kilda back when they were doing okay.

Between the 3k AFL member seats, Axcess One and Medallion Club seats there is too small of a sellable margin between the break even point and seats you can actually sell.

Estimated match return at Docklands is 36%. MCG is 41% but the capacity is much larger. You also have a considerable amount of MCC and AFL members that contribute to the match return.

Subiaco is 77%. Kardinia Park is 90%. Carrara is 100%.

I assume if AFL is able to acquire Docklands the return would likely be around 75% i would assume. Not only that, the revenue streams that either go straight to the AFL or Stadium Australia should now go to the gate, fixed revenue used to offset fixed overheads.

it should be significantly better unless the AFL intentionally botch it so they don't piss off the MCG tenants.

 

[Matt Stevic]

To this day, I'd like to know what on earth Wayne Jackson was thinking when he sold off Waverley and created this mess in the first place.

Can somebody please point out just ONE tiny little advantage that came from Etihad? Apart from "fancy TV screens" and "the seats aren't wood", both of which could have easily been fixed at a much lower cost at Waverley.

 

[Experimental]

Can somebody please point out just ONE tiny little advantage that came from Etihad? Apart from "fancy TV screens" and "the seats aren't wood", both of which could have easily been fixed at a much lower cost at Waverley.

A new, undercover, world-class stadium, in a fantastic location, perhaps? Did you really need somebody else to point that out?

 

[telsor]

I assume if AFL is able to acquire Docklands the return would likely be around 75% i would assume. Not only that, the revenue streams that either go straight to the AFL or Stadium Australia should now go to the gate, fixed revenue used to offset fixed overheads.

I'd think that 75% would be optimistic. For good or ill, the retractable roof and extra ground maintenance required due to the shadows (etc) does add costs to the ground that would need to be made up.

Also, returns are averages...Bigger crowds will always get better returns, both in relative and absolute terms.

 

[Scotland]

Between the 3k AFL member seats, Axcess One and Medallion Club seats there is too small of a sellable margin between the break even point and seats you can actually sell.

Estimated match return at Docklands is 36%. MCG is 41% but the capacity is much larger. You also have a considerable amount of MCC and AFL members that contribute to the match return.

Subiaco is 77%. Kardinia Park is 90%. Carrara is 100%.

This barrow is tired. It's been pushed enough. Stop comparing Etihad to Subiaco and Kardinia Park. They are completely meaningless comparisons and until Etihad becomes a small stadium in a country town or you start charging your 40,000 season ticket holders $50 a game you'll never get the mythical percentage return you think you deserve.

I assume if AFL is able to acquire Docklands the return would likely be around 75% i would assume. Not only that, the revenue streams that either go straight to the AFL or Stadium Australia should now go to the gate, fixed revenue used to offset fixed overheads.

it should be significantly better unless the AFL intentionally botch it so they don't piss off the MCG tenants.

You assume wrong. There will be no free lunches at an AFL-owned Etihad Stadium, and clubs which draw low crowds and are reliant on general ticket sales will continue to get return percentages they are not happy with.

 

[Silent Alarm]

To this day, I'd like to know what on earth Wayne Jackson was thinking when he sold off Waverley and created this mess in the first place.

Can somebody please point out just ONE tiny little advantage that came from Etihad? Apart from "fancy TV screens" and "the seats aren't wood", both of which could have easily been fixed at a much lower cost at Waverley.

Accessible to most Melburnians and easy to get to for people on a V-Line – as opposed to only flattering the vocal but still minority eastern suburbanites who liked Waverley. Not to mention the fact Waverley was outdated in the 1990s and would have required some serious redevelopment (paid for by who exactly?) by now.

Etihad is a great stadium in almost every single facet. The issues it faces would have been issues whether it was built at E-Gate or where Collingwood train now – as originally proposed. And considering Victorian AFL fans complain about the uber plush Etihad, imagine the complaints about Waverley – antiquated, ages from anywhere, a cauldron without the history that the MCG has, in a freezing cold location... Hawks aside, you would seriously struggle to get 75% of an Etihad crowd to Waverley. That is an obvious, fundamental issue for a professional and cash-centric AFL of 2014.

I don't want clubs to die, relocate, or even be shafted, but the issues with Etihad are the inherent issues of so many teams in one city playing out of a two-stadium duopoly. The only way you could get past this is if every team had their own oval. Which, obviously, is absolutely ludicrous.

 

[The_Wookie]

A couple of things here

• The AFL deal is to 2025, not 2015. The contract allowed for the number of games to be reduced from 44 to 40 in 2014
• Essendons deal is with the stadium, it was not negotiated by the AFL, but between the club and the stadium as foundation tenant. Carlton's deal is also with the stadium, but its match returns arent fantastic due to the upfront payment it received when it signed on originally. North, St Kilda and the Bulldogs havent had contracts at the stadium since 2007 as far as Ive been able to find, and may well almost be limited to the guaranteed 100k return per match.
  
• When the AFL takes over the stadium all revenues associated with the stadium then become part of the AFL revenue. Presently limited to pourage and signage, the AFL would take over carparking, catering, various member areas and clubs in the facility as well as revenue from non AFL events. This will have the effect of increasing stadium returns, as presently all these revenues are held by stadium management.
  
• If the AFL takes over the stadium early, it wont invalidate Essendons contract nor will it invalidate the Victory contract at the stadium.

 

[AstonSouffle]

Prove it.

The AFL had an interest in getting more clubs to sign up to Docklands as they wanted ground consolidation but to take that to 'we were forced' is a bit extreme.
The clubs held all the cards. They negotiated their agreements - can't blame the AFL for the clubs getting dud deals

Prove it?

Have the gall to call Kwality a troll and you spout stuff like that.

Essendon is a powerhouse club that much is known, they had better bargaining power. You choosing to ignore that, shows your either blinded by your superiority supporting Hawthorn gives you, or you're a troll bud. Everyone knows those teams got a dud deal and didn't exactly have a lot of choice due to circumstances. You suggesting 'tough' they should of known better? You wouldn't have that opinion of you were a supporter of those clubs.

 

[SterlingArcher]

. Not sure I understand your point

They'd continue to play them at their home grounds; or wherever the AFL decided to play them, but as always in negotiation with the clubs.
Pretty much same as now.

Nope, think you're completely wrong here in that you're basically saying his point is no big deal. The clubs hands were forced.

 

[telsor]

To this day, I'd like to know what on earth Wayne Jackson was thinking when he sold off Waverley and created this mess in the first place.

Can somebody please point out just ONE tiny little advantage that came from Etihad? Apart from "fancy TV screens" and "the seats aren't wood", both of which could have easily been fixed at a much lower cost at Waverley.

Because Arctic park had awful traffic problems so was hated by all and sundry.

 

[B4Bear]

Prove it.

The AFL had an interest in getting more clubs to sign up to Docklands as they wanted ground consolidation but to take that to 'we were forced' is a bit extreme.
The clubs held all the cards. They negotiated their agreements - can't blame the AFL for the clubs getting dud deals

Where do you come up with this s**t? We were forced to play there by the AFL, and effectively had zero bargining power because of it.

North, St Kilda and the Dogs were the sacrificial lambs for the AFL.

 

[Doggy Dan]

All those thinking that the AFL taking over Etihad will somehow change any of the current club deals are deluded. The AFL will hold current contracts firm and continue to drip feed the Dogs, Saints, and North, like little kids having to ask for pocket money. This in turn forces the kids to do their chores in silence (for us that means dreadful scheduling, leading to dreadful exposure, leading to our perpetual issues).

 

[The_Wookie]

All those thinking that the AFL taking over Etihad will somehow change any of the current club deals are deluded. The AFL will hold current contracts firm and continue to drip feed the Dogs, Saints, and North, like little kids having to ask for pocket money. This in turn forces the kids to do their chores in silence (for us that means dreadful scheduling, leading to dreadful exposure, leading to our perpetual issues).

North, St Kilda and the Dogs dont have contracts. The contract they play under is the one the AFL holds that forces a certain number of games to be played at the Stadium. Those three clubs havent had a fixed contract in years

 

[TedDougChris]

North, St Kilda and the Dogs dont have contracts. The contract they play under is the one the AFL holds that forces a certain number of games to be played at the Stadium. Those three clubs havent had a fixed contract in years

Yes, but we (Dogs) have tried to play games at Kardinia Park in recent years - and on every occasion the AFL has said No. We may not have a contract for Docklands, but we are being forced to play there and have our hands tied behind our backs in terms of trying to generate more revenue by playing elsewhere... There was a statement earlier this year that we were making more money from the VFL games at Whitten Oval than we were at our AFL games at Docklands...

 

[Papa G]

If they buy it out, won't it still have to be paid for? Or do you think the AFL will be just slash the price of chips and be happy for clubs to make profits on 17,000 crowds?

 

[Doggy Dan]

Yes, but we (Dogs) have tried to play games at Kardinia Park in recent years - and on every occasion the AFL has said No. We may not have a contract for Docklands, but we are being forced to play there and have our hands tied behind our backs in terms of trying to generate more revenue by playing elsewhere... There was a statement earlier this year that we were making more money from the VFL games at Whitten Oval than we were at our AFL games at Docklands...

I don't believe there are no contracts or formal agreements in place but if it is the case and the AFL are not allowing us to explore other avenues for our home games this is third line enforcement, we should contact the ACCC!

 

[Doc Hattori]

Obviously the AFL think buying the stadium now rather than for $1 later is cheaper than propping up the clubs that entered into bad agreements

which is exactly the opposite of Vlad's view

 

[TedDougChris]

If you didn't sign the agreement with Docklands where would you have played games? They wouldn't force any team to fold. They didn't allow Fitzroy to fold (to drive to point home), they aren't going to allow and push their luck on another team (see North to GC)

No, the AFL have never, ever done anything to impact on the Bulldogs, have they...... There has never been any bias towards certain clubs from the AFL.. [/research 1989 Dogs-Lions Merger before making stupid ill-informed comments mode]

 

[ManOfClay]

They've been bled badly enough by Etihad (as have we, but as always North has been smart, agile and innovative and got our way out of it) and they can't take any more.

Yep. North have ever so swiftly positioned themselves to be the Hobart Roos

 

[NZ_Tiger]

While the AFl pay $250 mil now rather $1 in 2025, that price includes the ten years of revenue streams. $330 purchase price would probably be forecast to return 7%-8% on investment over the course of the agreement, so some decent coin.

 

[Tas]

This barrow is tired. It's been pushed enough. Stop comparing Etihad to Subiaco and Kardinia Park. They are completely meaningless comparisons and until Etihad becomes a small stadium in a country town or you start charging your 40,000 season ticket holders $50 a game you'll never get the mythical percentage return you think you deserve.

They aren't meaningless comparisons, while Docklands has much higher overheads, both static and variable, the AFL will likely play 50+ games at Docklands compared to 7 at Geelong or 20 at Subiaco, the static overheads are divided amongst a lot more games. Naming rights sponsorship and fixed advertising, which are far more lucrative than they are anywhere else that plays AFL, would also be offset against static overheads.

Ultimately, the ability to maximise revenue is going to be based on the how many of the premium membership categories are sold and the amount of corporate boxes the stadium manager and the clubs can sell. Membership price is largely limited by the AFL controlling the door price.

You assume wrong. There will be no free lunches at an AFL-owned Etihad Stadium, and clubs which draw low crowds and are reliant on general ticket sales will continue to get return percentages they are not happy with.

Yeah, who am I going to believe, all the AFL club CEOs who have done the math and told the AFL unanimously that it is imperative they buy out Docklands as part of their equalisation policy, or believe your idiotic opinion which is balanced by two equally large chips on each shoulder?

Anyone who pulls a small crowd isn't going to be making money, nobody expects that. It s when you get 40k+ and are still losing money which is the problem.

Ultimately, how good or how bad it is going to be is going to depend on how clean the stadium is and if all the revenue streams are accounted for. Clean doesn't mean there is no debt to pay off and there aren't expenses to pay for hosting games, clean means there are no snouts in the trout.

 

[Tas]

I'd think that 75% would be optimistic. For good or ill, the retractable roof and extra ground maintenance required due to the shadows (etc) does add costs to the ground that would need to be made up.

Also, returns are averages...Bigger crowds will always get better returns, both in relative and absolute terms.

Docklands and MCG both have very low returns compared to the other major stadiums, but both have a lot of debt associated with them, the Adelaide Oval redevelopment has cost $610m, $30m came from the Federal Government, $5m from the AFL and the rest has been paid for by the state government. If Port or the Crows had to repay that debt through their 20 games a year then both clubs would be dead in a matter of years.

Only a small portion of the MCG redevelopment was funded by the state government, I think $150m or so out of the $1b+ cost, and most of that debt repayment has been worn by AFL football, the cost associated with using the MCG for a few hours is radically different to what they charge Victoria for a 5 day test.

Docklands was mostly commercial funding. Both our two stadiums have taken a premium chunk out of the revenue that could be earned. Getting bigger crowds is always going to be better, the problem at Docklands is if you have to draw 40k+ to break even and your maximum potential is 50k then there is too small a margin to make a decent return. Even though the MCG has a high base cost as well, there is the potential for the very big drawing games to offset that because there is a huge variance between the break even point and capacity.

Docklands break-even point has to be 15-20k otherwise there just isn't the scope to sell enough tickets to generate a decent enough return, if you can't make a decent return even when selling games out in fully ticketed games then the stadium is pointless.

 

[FootyJunkie]

Will it be re-named AFL Stadium?

 

[FootyJunkie]

Does that mean that we can buy cheap pies and chips.

players desperate to get out of Collingwood?