Docklands (Etihad) stadium new AFL tenant club agreements

NoobPie

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The AFL were foolish IMO - from a tenant club pov - to pay $200m and have to service that with debt rather than wait a few years and each year would have been $25m less to purchase it which would have only been $30 on 31/12/25.

They have to find around $12 mil cash to pay the interest and depending on length of loan maybe $20m of capital repayments each and every year. Where does that money come from?? Tenant clubs.
Well, clearly all else being equal, they thought it advantageous to bring forward the purchase. Perhaps relating to the potential public investment. Note also that the afl is giving a ten % dividend and is intending on paying off the debt 3 years ahead of planned ownership
 

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RussellEbertHandball

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Well, clearly all else being equal, they thought it advantageous to bring forward the purchase. Perhaps relating to the potential public investment. Note also that the afl is giving a ten % dividend and is intending on paying off the debt 3 years ahead of planned ownership
The AFL, just like Graeme Sameul did in 1998-1999 when he engineered the AFL's put $30m in now, own it all for $30 in 2025, wasn't thinking of its clubs when it did the deal. It was thinking of its own position.

A 10% dividend of what and to whom??

Are you saying they paid the owners $200m and are paying off their debt as well? If not, then what is the relevance of 3 years?
 
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NoobPie

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The AFL, just like Graeme Sameul did in 1998-1999 when he engineered the AFL's put $30m in now, own it all for $30 in 2025, wasn't thinking of its clubs when it did the deal. It was thinking of its own position.

A 10% dividend of what and to whom??

Are you saying they paid the owners $200m and are paying off their debt as well? If not, then what is the relevance of 3 years?
Dividend wrong word and I've attracted the opportunist pedantry accordingly. From what I've heard the Tennent clubs are getting 10% better returns and the afl is still hoping to pay off the debt by 2022/3...ie ahead of the handover
 

The_Wookie

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Dividend wrong word and I've attracted the opportunist pedantry accordingly. From what I've heard the Tennent clubs are getting 10% better returns and the afl is still hoping to pay off the debt by 2022/3...ie ahead of the handover
In these things the wrong words matter, and the description was vague. Its not like a spelling mistake or grammatical error - say like "tennent" instead of the more correct, tenant.
 

Kwality

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Well, clearly all else being equal, they thought it advantageous to bring forward the purchase. Perhaps relating to the potential public investment. Note also that the afl is giving a ten % dividend and is intending on paying off the debt 3 years ahead of planned ownership
The propaganda surrounding the timing of the purchase was a feel good result for the fans of the tenant clubs, none of which has been delivered.

In the tailights of the game moved to Ballarat ....
 

NoobPie

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The propaganda surrounding the timing of the purchase was a feel good result for the fans of the tenant clubs, none of which has been delivered.

In the tailights of the game moved to Ballarat ....
You're saying the afl over egged the benefits of the early purchase to the tenant clubs for pr purposes? Maybe. Has absolutely no relevance to whether it was a prudent investment though

Again, on face value, the afl is claiming it will pay the stadium advanced purchase off in 6 years while increase returns to tenant clubs by 10%.
 

Kwality

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You're saying the afl over egged the benefits of the early purchase to the tenant clubs for pr purposes? Maybe. Has absolutely no relevance to whether it was a prudent investment though

Again, on face value, the afl is claiming it will pay the stadium advanced purchase off in 6 years while increase returns to tenant clubs by 10%.
Got plenty to do with relevance to tenant clubs, was the Commission mislead or was it party to the spin? As for the fans of the clubs concerned, they bitched & whinged about the old owners but dont appear to have the same old, same old under the AFL, go figure ...
 

The_Wookie

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Got plenty to do with relevance to tenant clubs, was the Commission mislead or was it party to the spin? As for the fans of the clubs concerned, they bitched & whinged about the old owners but dont appear to have the same old, same old under the AFL, go figure ...
I assume that if the league can give them a 10% up lift now, and pay debt off in less time that the lease would have been - 2-3 years earlier apparently - then the clubs are going to end up better off again when the league isnt using stadium revenue to service the loan - as the previous owners did.
 

Kwality

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I assume that if the league can give them a 10% up lift now, and pay debt off in less time that the lease would have been - 2-3 years earlier apparently - then the clubs are going to end up better off again when the league isnt using stadium revenue to service the loan - as the previous owners did.
:eek: ... good news would be everywhere the AFL could claim credit.
 

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RussellEbertHandball

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I assume that if the league can give them a 10% up lift now, and pay debt off in less time that the lease would have been - 2-3 years earlier apparently - then the clubs are going to end up better off again when the league isnt using stadium revenue to service the loan - as the previous owners did.
What is the benefit of paying out the loan 2 or 3 years before they could have got it for free?? They might then do a good deal with the clubs?

Paying off a $200m+ loan in 6 years instead of 10 years affects the net cash flow the AFL receive from ownership of the stadium and leaves less cash to give to the clubs unless they draw it from consolidated revenue. There is no real benefit to the tenant clubs for paying off the loan by 2023 compared to the AFL owing it for $30 at the end of 2025.
 

The_Wookie

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What is the benefit of paying out the loan 2 or 3 years before they could have got it for free?? They might then do a good deal with the clubs?
its not just stadium returns to the clubs, the AFL is eyeing off upgrades to the facilities as well, and is in a better position to negotiate those as owner rather than renter of the stadium.

Paying off a $200m+ loan in 6 years instead of 10 years affects the net cash flow the AFL receive from ownership of the stadium and leaves less cash to give to the clubs unless they draw it from consolidated revenue. There is no real benefit to the tenant clubs for paying off the loan by 2023 compared to the AFL owing it for $30 at the end of 2025.
I dont think we have enough public information to make that analysis properly. The AFL must believe there is some merit to the idea though.

Also I dont know if you noticed this - but the AFL didnt actually enact its purchase of the land either until last year - so it was never just $30, they still had to lay out the $30 million for the freehold title. (which was previously suggested, given they had a short period from the end of the lease to buy the freehold according to notes in the Annual Reports)
 

Our Game

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The AFL have their hand out to the State government for $300 million for improvements which they wouldnt have been able to ask for if they didnt own the property
BTW it would cost 1 billion plus to replace the stadium so $200 Million is a great deal esp for the tenant clubs to also gain 10% in revenue
 

threenewpadlocks

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Correct me if I'm oversimplfying this but the reason the AFL purchased Etihad can come down to:

Differences in how land tax is calculated now it's owned by a non-profit
A different revenue stream should the next TV rights deal not increase, to reduce the reliance on TV revenue money etc.
A belief that they could get more money out of Etihad than the previous owners could - this could be because they could get Government money for a refurbishment, which the previous owners couldn't, and therefore be more appealing for other events and sports teams to make a revenue out of that.
A belief that for whatever reason they could make more money out of the stadium than the previous owners couldn't - how they negotiate with various other sporting codes etc.
 

BringBackTorps

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H/Sun 9.3 E.Sewell writes, re a deal (for period to 2022) reached between St K & the AFL over DS:-
.St K has "... a recast stadium deal that will double its matchday earnings".
."...the average take at a home game will rise from $125,000 to $325,000...with 11 home games, the bottom line improvement is forecast to be $2.2 million".

. StK CEO M Finnis said "We kind of feel for 17 years we've been paying the rent and the mortgage on Etihad Stadium...it does shine a light on how poor a deal we've been wearing for over a generation".

Also, Sewell said "Saints are tonight expected to confirm a five-year, $1 million partnership with paper brand Reflex to sponsor the club's women's program"
(I assume this is $1 million pa)

Article is behind paywall -heading "Saints reveal bold plan to halve $10 million debt by 2020".

EDIT:

Foxsports 8.3 states:-

. the EXTRA $2 million pa that St Kilda will receive from the new DS deal presumes the crowds are about the same as in 2017
. that whilst the Saints wont specify a dollar figure on Reflex sponsorship of the Southern Saints VFLW teams in 2018 & 2019, and AFLW teams 2020-22, it is believed "to be close to $1 million pa".

It should be noted that the southern suburbs have strong female AF participation nos.
The South Metro Football League has about 11,000 jnr. team players, & 2000+ are jnr female team players. St Kilda will probably attempt to exploit this advantage (now that its financial position will be significantly improved) -& ramp up these female nos. before it commences in the AFLW in 2020
 
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Topkent

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H/Sun 9.3 E.Sewell writes, re a deal (for period to 2022) reached between St K & the AFL over DS:-
.St K has "... a recast stadium deal that will double its matchday earnings".
."...the average take at a home game will rise from $125,000 to $325,000...with 11 home games, the bottom line improvement is forecast to be $2.2 million".

. StK CEO M Finnis said "We kind of feel for 17 years we've been paying the rent and the mortgage on Etihad Stadium...it does shine a light on how poor a deal we've been wearing for over a generation".

Also, Sewell said "Saints are tonight expected to confirm a five-year, $1 million partnership with paper brand Reflex to sponsor the club's women's program"
(I assume this is $1 million pa)

Article is behind paywall -heading "Saints reveal bold plan to halve $10 million debt by 2020".
I'd be shocked if they it's 1m pa
 

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