AFL Takes Out $280M Loan & Reports A $17.8M Loss

[The_Wookie]

Are you serious? Why does the Vic Govt suddenly represent a factor - was it in 2011 or whenever the whinging/subsidies started ?

You mean besides the fact the AFL are requesting millions and millions of dollars from the Vic Gov at present?

IF the AFL don't own the joint, cant set the rentals, I ask why not? They can, they wont, wont by choice.

You really are full of it.

Yep the AFL is looking to get into the Vic taxpayer, but how does that effect todays rentals? I'll tell you, it doesn't!

and Ill tell you - theres no way you can possibly know that despite your sudden revelations of past experience.

 

[telsor]

OK, the WA Govt are the landlord, so are the AFL.

The Vic Govt are the landlord (MCG Trust) at the G, aren't they opposition for events/games .... yes, if you are chasing taxpayer dollars, Governments are the only way to go.

You mean, like in the AFLs stated plan to get the precinct developed further?

WA Govt are the landlord, and the effective owner of the potential tenants (WAFC owns the clubs, WAFC is a government body), yet the negotiations go on...


Even if the Vic government wasn't involved though, the AFL has to fully understand the finances of the stadium (and remember, they've never runa major stadium before, so it's outside their core skillset), then offer a deal, and the clubs that play there, having been screwed over previously, will doubtless want to go over it in minute detail. All of which take a considerable amount of time.

 

[Our Game]

They want a percentage of revenue not a percentage of peofit.

Revenues are huge and ever growing. The AFL just waste insane amounts of money. That is why they made a loss.

You are right. The next ten AFL executives (no doubt a number of ex football mates) under Gil get $650,000 pa + bonuses I cant see how any are worth this kind of money!
There is should be about $4 million that could be saved there alone.

 

[Rob]

Granted, there are plenty of variables (regarding who the opposition is, the amount of club members that attend, signage revenue etc) so yes the 30k is a ballpark.

However whether the breakeven point (for ethihad tenants who aren't injected with a favourable stadium deal) is 30k, or 25k or 20k.... is merely incidental.

When it's possible, as the saints discovered in 2013, to need to write the stadium a cheque for $100,000 after hosting a single game.... there's nothing mythical about it.

How is that such a problem? If all their income comes from prepaid memberships and very few are paying at the gate (which is hardly a surprise if St Kilda were playing a non Vic team), who do you propose pay the matchday expenses, if not St Kilda?

 

[The_Steadier]

How is that such a problem? If all their income comes from prepaid memberships and very few are paying at the gate (which is hardly a surprise if St Kilda were playing a non Vic team), who do you propose pay the matchday expenses, if not St Kilda?

You'd be right if the host club was just being charged for the stadiums costs on the day.


But what the host clubs are being charged per game is not just covering the stadiums costs on the day.

The price the host teams are locked in to paying (thanks to the AFLs 50 games a year contract) for every game covers:

*the stadiums costs averaged out over all the contracted games, regardless of who's playing and who's paying at the gate;
*plus a whole lot of juicy juicy fat too.

This is why it's true when people say the tenant clubs are/have been paying off the stadium for the league.

 

[Kwality]

You mean, like in the AFLs stated plan to get the precinct developed further?

WA Govt are the landlord, and the effective owner of the potential tenants (WAFC owns the clubs, WAFC is a government body), yet the negotiations go on...


Even if the Vic government wasn't involved though, the AFL has to fully understand the finances of the stadium (and remember, they've never runa major stadium before, so it's outside their core skillset), then offer a deal, and the clubs that play there, having been screwed over previously, will doubtless want to go over it in minute detail. All of which take a considerable amount of time.

So you buy the delays, I don't .... previous claims included rebate the interest charge & reflect the savings in the rent, but of course that doesn't work, there is still interest.

 

[Rob]

You'd be right if the host club was just being charged for the stadiums costs on the day.


But what the host clubs are being charged per game is not just covering the stadiums costs on the day.

The price the host teams are locked in to paying (thanks to the AFLs 50 games a year contract) for every game covers:

*the stadiums costs averaged out over all the contracted games, regardless of who's playing and who's paying at the gate;
*plus a whole lot of juicy juicy fat too.

This is why it's true when people say the tenant clubs are/have been paying off the stadium for the league.

How do you know this? Have you read the contract?

 

[The_Steadier]

How do you know this? Have you read the contract?

Of course I've read it.
Naturally I'm an AFL lawyer, here to offer opinions with my colleagues.
Afterall isn't that what bigfooty is for?

It's certainly not for mug punters to offer opinions to other mugs now is it?

 

[Rob]

Of course I've read it.
Naturally I'm an AFL lawyer, here to offer opinions with my colleagues.
Afterall isn't that what bigfooty is for?

It's certainly not for mug punters to offer opinions to other mugs now is it?

My apologies, when you made clear statements as to the obligations of host clubs I assumed you might know what you were talking about, as opposed to just making s**t up.

 

[Kwality]

SOOKING is par for the course @ Docklands, its someone else who is responsible ... one thing appears to me, it was stuffed up for AFL footy AND nothing has changed leading up to season 2017, the AFL will take the money from the supposed victims of the dud deals, & ...

The AFL bought the place & AFL cheerleaders bleat about how little competence they (the AFL) have to deliver what fans were expecting, season 2018 maybe ... Ben Dover in the far queue ... the AFL kept the management team in place at Docklands, excuses by the cheerleaders are transparent ... lets employ someone who is competent GIL?

 

[Professor Knowall]

SOOKING is par for the course @ Docklands, its someone else who is responsible ... one thing appears to me, it was stuffed up for AFL footy AND nothing has changed leading up to season 2017, the AFL will take the money from the supposed victims of the dud deals, & ...

The AFL bought the place & AFL cheerleaders bleat about how little competence they (the AFL) have to deliver what fans were expecting, season 2018 maybe ... Ben Dover in the far queue ... the AFL kept the management team in place at Docklands, excuses by the cheerleaders are transparent ... lets employ someone who is competent GIL?

Yes, Peter Gordon obviously didn't know what's he was talking about when he said just last week that the AFL buyout will be tremendous for the Bulldogs. I'm sure he'll be most thankful for your inside knowledge that the AFL only purchased Docklands just to continue to screw over the Tenant clubs.

Given these "facts" as supplied by Kwality, it's just a bit surprising we haven't heard so much as a murmur of complaint from the tenant clubs, let alone the expected outrage - in fact quite the opposite. Why is this so?

 

[Garlic muncher]

Yes, Peter Gordon obviously didn't know what's he was talking about when he said just last week that the AFL buyout will be tremendous for the Bulldogs. I'm sure he'll be most thankful for your inside knowledge that the AFL only purchased Docklands just to continue to screw over the Tenant clubs.

Given these "facts" as supplied by Kwality, it's just a bit surprising we haven't heard so much as a murmur of complaint from the tenant clubs, let alone the expected outrage - in fact quite the opposite. Why is this so?

Yep, because Peter Gordon is a yes man - not!

 

[Kwality]

Yes, Peter Gordon obviously didn't know what's he was talking about when he said just last week that the AFL buyout will be tremendous for the Bulldogs. I'm sure he'll be most thankful for your inside knowledge that the AFL only purchased Docklands just to continue to screw over the Tenant clubs.

Given these "facts" as supplied by Kwality, it's just a bit surprising we haven't heard so much as a murmur of complaint from the tenant clubs, let alone the expected outrage - in fact quite the opposite. Why is this so?

As you know Prof, that's not what I said ..... I am critical of the failure of the AFL to act after years of clubs whingeing despite your poor attempt to put your own spin on what I said. BF posts on the subject were thick & fast, were being the operative word.

As his clubs directly effected, Mr Gordon running the party line is good politics.

Perhaps the deals aren't the duds the AFL expected ..... perhaps there isn't the room to move as anticipated .... is the Victory deal an asset for the stadium ...
... clearly there is something stopping the AFL acting.

 

[Demonoid]

Personally I don't see how the Docklands home clubs will be that much better off in the first few years.

$200mil loan I assume is at 5-6% so that is $10-$12mil of interest paid in year 1 of the loan and then there are principal repayments. The $80mil looks like for working capital needs which needs to be paid back both principal and interest, probably over a shorter period than the $200m loan. If the AFL has stitched up Vic government monies for upgrade to the stadium and precinct then the deal makes some sense otherwise they should have waited a few years.

The previous owners were carrying $200mil in debt in 2013 and I doubt the situation got much better in 3 years since then.

http://www.afr.com/business/etihad-stadium-profits-up-24pc-to-48m-20140518-iuc2n
The privately owned Etihad Stadium in Melbourne recorded a 24 per cent increase in operating profit in the year to December 2013 according to documents recently lodged with the Australian Securities and Investments Commission.The financial report of the stadium’s owner, Stadium Operations Limited, revealed net operating profit reached about $4.8 million in 2013, up from $3.9 million the year before. Total revenue rose by about 10 per cent to $79 million. However, the stadium’s net loss after about $21 million worth of interest expenses was $16.7 million, down slightly from the $17.3 million loss recorded in 2012.

The Stadium Operations balance sheet showed its owners have a loan of about $199 million outstanding. The stadium is owned by five investment and superannuation funds, including the Statewide Superannuation Trust and the JF Infrastructure Yield Fund.
http://www.afr.com/business/etihad-stadium-profits-up-24pc-to-48m-20140518-iuc2n

The medallion Club will be a key component of the AFL making decent $$$

Surely they would be paying less than "5-6%"? I'm paying under 4% for my loan and from what I understand, the higher your borrowings the better your interest rate. Granted commercial loans have higher interest rates, but I dare say one of the reasons the AFL acted now are that interest rates are at historic lows. It would not surprise me if they were paying not much more than the inflation rate. Their partners NAB would have given them a sweet deal


On iPad using BigFooty.com mobile app

 

[Byron_Clanger]

AFL's gotta stop propping up the bummy clubs, either you're financially viable to exist on your own or you're not. I'd rather see clubs fold than have the league and my club constantly having to fork over money to other teams.

 

[RussellEbertHandball]

Surely they would be paying less than "5-6%"? I'm paying under 4% for my loan and from what I understand, the higher your borrowings the better your interest rate. Granted commercial loans have higher interest rates, but I dare say one of the reasons the AFL acted now are that interest rates are at historic lows. It would not surprise me if they were paying not much more than the inflation rate. Their partners NAB would have given them a sweet deal


On iPad using BigFooty.com mobile app

But they wont be getting a 25 year loan like a housing loan. It will most likely be 10 years.

 

[The_Wookie]

AFL's gotta stop propping up the bummy clubs, either you're financially viable to exist on your own or you're not. I'd rather see clubs fold than have the league and my club constantly having to fork over money to other teams.

Id like to see your club compete on the same terms as the terms as these other "bummy" clubs. Christ I hope it happens at Perth.

 

[Rob]

Id like to see your club compete on the same terms as the terms as these other "bummy" clubs. Christ I hope it happens at Perth.

Which terms are you talking about?

Presumably not the one about how the 2 Perth clubs have to pay millions to the local governing body.

 

[Kwality]

Id like to see your club compete on the same terms as the terms as these other "bummy" clubs. Christ I hope it happens at Perth.

& that says it all !!!

 

[The_Wookie]

Which terms are you talking about?

Presumably not the one about how the 2 Perth clubs have to pay millions to the local governing body.

No Im talking about the one where the clubs have access to revenues at stadiums that Victorian clubs - other than Geelong - can only dream of, and have no say in, due to over-arching AFL deals. Specifically, hospitality and event revenues at the stadium, as well as the ability to charge what they want for memberships - agaain a luxury that no one else has, not to mention no competition from the AFL itself - and while the clubs have to pay a royalty and rent, its still only a part of what they make from these revenues.

& that says it all !!!

Yawn. You take stuff so literally when you want to.

 

[Rob]

No Im talking about the one where the clubs have access to revenues at stadiums that Victorian clubs - other than Geelong - can only dream of, and have no say in, due to over-arching AFL deals. Specifically, hospitality and event revenues at the stadium, as well as the ability to charge what they want for memberships - agaain a luxury that no one else has, not to mention no competition from the AFL itself - and while the clubs have to pay a royalty and rent, its still only a part of what they make from these revenues.

You're making a huge assumption that:
a) smaller Victorian clubs could actually sell that space to start with - at least enough to cover the rent (which would obviously run into the millions for a clean stadium). They don't seem to be able to sell what they've got now in terms of corporate facilities, and clearly having access to Medallion club and MCC/AFL members seats would just give them a s**t ton of empty space. If they have to cough up millions for that then you'll send them to the wall.
b) they'd be able to negotiate a good deal without the bloc power that the AFL has. Why on earth would the MCC or Docklands authority give a small Vic club a good deal? What do they bring to the table? At least at the moment they can tag onto the negotiating power that comes with wanting the matches involving the big Vic clubs.

I think the larger clubs could argue that they'd be better off if they were simply left to their own devices. The smaller clubs, probably not IMO. They'd either get screwed by the large stadiums having to pay for a bunch of space they can't sell, or end up playing at some cheap suburban shithole to terrible crowds whilst the larger clubs get bigger and bigger with their superior facilities. A bit like soccer in London if you want a comparison where Millwall and Leyton Orient have no hope of competing with Chelsea and Arsenal. Geelong isn't a great analogy, they use their geographic advantage by capitalising on their location to get funding for their stadium. No Melbourne club (certainly no small Melbourne club anyway) would ever have that sort of bargaining power.

Not that i'm in favour of the current system, I personally think the AFL has no business selling memberships or signing stadium deals for some clubs and not others. But I don't think doing away with it would mean all Victorian clubs would be better off.

 

[Kwality]

No Im talking about the one where the clubs have access to revenues at stadiums that Victorian clubs - other than Geelong - can only dream of, and have no say in, due to over-arching AFL deals. Specifically, hospitality and event revenues at the stadium, as well as the ability to charge what they want for memberships - agaain a luxury that no one else has, not to mention no competition from the AFL itself - and while the clubs have to pay a royalty and rent, its still only a part of what they make from these revenues.
Yawn. You take stuff so literally when you want to.

great stuff .... seeking to deny posters opinions that hold a different view to your own ... I have my opinions even when you don't like it, SO do you want it to happen in Perth or not ...

Do you want the stadium deal at Geelong to fall over, or just the one in Perth ... you'd be consistent?

 

[The_Wookie]

great stuff .... seeking to deny posters opinions that hold a different view to your own ... I have my opinions even when you don't like it, SO do you want it to happen in Perth or not ...

I havent denied anyone anything. I do find your repetitiveness tiresome. Id like Perth folks to actually appreciate what they have and the difficulties Melbourne clubs face compared to the two WA clubs.

Do you want the stadium deal at Geelong to fall over, or just the one in Perth ... you'd be consistent?

Geelong folks still play Etihad and the MCG, and you dont see them in here telling other clubs to shape up or ship out.

You're making a huge assumption that:
a) smaller Victorian clubs could actually sell that space to start with - at least enough to cover the rent (which would obviously run into the millions for a clean stadium). They don't seem to be able to sell what they've got now in terms of corporate facilities, and clearly having access to Medallion club and MCC/AFL members seats would just give them a s**t ton of empty space. If they have to cough up millions for that then you'll send them to the wall.

b) they'd be able to negotiate a good deal without the bloc power that the AFL has. Why on earth would the MCC or Docklands authority give a small Vic club a good deal? What do they bring to the table? At least at the moment they can tag onto the negotiating power that comes with wanting the matches involving the big Vic clubs.[/quote]

Id like small Victorian clubs to have the option of not playing at either stadium if they felt they could get better financial rewards elsewhere. They do not have a choice at the moment. Its play where you are told.

I think the larger clubs could argue that they'd be better off if they were simply left to their own devices. The smaller clubs, probably not IMO. They'd either get screwed by the large stadiums having to pay for a bunch of space they can't sell, or end up playing at some cheap suburban shithole to terrible crowds whilst the larger clubs get bigger and bigger with their superior facilities. A bit like soccer in London if you want a comparison where Millwall and Leyton Orient have no hope of competing with Chelsea and Arsenal. Geelong isn't a great analogy, they use their geographic advantage by capitalising on their location to get funding for their stadium. No Melbourne club (certainly no small Melbourne club anyway) would ever have that sort of bargaining power.

And frankly i dont care if they do or dont. They SHOULD have the right to figure it out for themselves.

Not that i'm in favour of the current system, I personally think the AFL has no business selling memberships or signing stadium deals for some clubs and not others. But I don't think doing away with it would mean all Victorian clubs would be better off.

End of the day, if you want clubs to sink or swim, then they should have the freedom of choice to do that, but as long as the AFL continues to compete against them in membership, sponsorship, seating and stadium deals, then the AFL can deal with shortfalls in club funding because of it. This is the legacy of the league we have now. and Until that day comes, fans of the WA model can rant all they like about Victorian football clubs, I couldnt give a damn.

 

[Kwality]

I havent denied anyone anything. I do find your repetitiveness tiresome. Id like Perth folks to actually appreciate what they have and the difficulties Melbourne clubs face compared to the two WA clubs.



Geelong folks still play Etihad and the MCG, and you dont see them in here telling other clubs to shape up or ship out.



b) they'd be able to negotiate a good deal without the bloc power that the AFL has. Why on earth would the MCC or Docklands authority give a small Vic club a good deal? What do they bring to the table? At least at the moment they can tag onto the negotiating power that comes with wanting the matches involving the big Vic clubs.

Id like small Victorian clubs to have the option of not playing at either stadium if they felt they could get better financial rewards elsewhere. They do not have a choice at the moment. Its play where you are told.



And frankly i dont care if they do or dont. They SHOULD have the right to figure it out for themselves.



End of the day, if you want clubs to sink or swim, then they should have the freedom of choice to do that, but as long as the AFL continues to compete against them in membership, sponsorship, seating and stadium deals, then the AFL can deal with shortfalls in club funding because of it. This is the legacy of the league we have now. and Until that day comes, fans of the WA model can rant all they like about Victorian football clubs, I couldnt give a damn.[/QUOTE]

Its not as if anyone does not know the AFL royally stuffed stadium deals in Melbourne, fawning to the MCC, arriving late for the Docklands. Club after club sacrificed by AFL mismanagement.
The difficulty for many Melbourne clubs is they can not pull a crowd except against the bigger Melbourne clubs, now that'd be news !!

 

[The_Wookie]

The difficulty for many Melbourne clubs is they can not pull a crowd except against the bigger Melbourne clubs, now that'd be news !!

An AFL club should be able to survive with a 26,000 crowd average.