SANFL Club Ownership of Adelaide Oval?

[Sojourner]

My information is that each of the SANFL clubs owns an equal share in Football Park. With the move by the SANFL to a redeveloped Adelaide Oval, will the SANFL clubs also own an equal share of the new venue each?

If Adelaide Oval is to be the showpiece stadium controlled by the SANFL then it should follow that the 9 SANFL clubs should "own" equal portions of it also as was the previous arrangement with Football Park?

[redandblack]

None of the clubs 'own' anything except a share in the assets of the SANFL and that share would only become tangible in the event the SANFL as a body ceases to exist.

I would think that Adelaide Oval is owned by either the Adelaide City Council or the State Government. The SACA leases it, so it's not possible for the SANFL or its clubs to own it.

Unfortunately I don't think your idea on this stands up, Sojourner.

[gossipgirl]

My information is that each of the SANFL clubs owns an equal share in Football Park. With the move by the SANFL to a redeveloped Adelaide Oval, will the SANFL clubs also own an equal share of the new venue each?

If Adelaide Oval is to be the showpiece stadium controlled by the SANFL then it should follow that the 9 SANFL clubs should "own" equal portions of it also as was the previous arrangement with Football Park?

in this case nothing changes for the clubs as the SANFL will still own footy park

[doggies4eva]

Sojourner is basically right.

The fact is the 9 clubs own the SANFL which owns Footy Park.

The question that he alludes to is if the 9 clubs have control of an asset that shows a good return on investment then why would they want to degrade that asset by moving AFL events which are the cash flow that gives Footy Park its value?

30 odd years ago when the SANFL saw the need to leave Footy Park there was a significant reason for doing so. After grabbing a handfull of cash now it may well find itself in 30 years time back in the situation that it found itself in when the move to Footy Park was forced.

[Hondo]

D4eva your argument would be the basis of the SANFL's demands on the SACA for this deal to go ahead

As I have read it the SANFL want a cash return from AFL games at AO at least the same as they get currently from AAMI Stadium. Fair enough too. They have the bargaining strength in this deal so I reckon they'll get most of what they want but we'll see.

If they get that then they have all that land at West Lakes to do with what they please including running other sporting events at AAMI Stadium (maybe). Don't quote me, but I heard that under the Liberals plan for a brand new CBD Stadium (without the SACA), the SANFL would have to sell AAMI Stadium to kick the cash into the new one. Not 100% sure on that though so I'll stand corrected.

To get an ownership stake in AO the SANFL would need to invest funds into it somehow rather than just use it every weekend in AFL season.

[doggies4eva]

Maybe I need to rethink this idea! The value of an asset is determined by the expected future cashflow from operating that asset.

In the case of a sporting stadium it is the profits derived from the revenue of events less the expenses of operation those events and the overheads of maintaing the asset. The propect of one day selling the asset and recovering (possibly more than the initial purchase price in) cash also needs to be factored in.

Clearly the key reason that Footy Park is a vlauable asset is because of the ability of the SANFL to generate cash flow from AFL games and the SANFL GF. I doubt that there is much profit in holding minor round SANFL games given the cost of staffing, cleaning and maintaing such a large stadium.

So it the main cash genretaing activities are moved to Adelaide Oval then that Oval will become a more valuable asset and Footy Park will decline. Because of this I think it is paramount that the SANFL gets some sort of permanent ownership of Adelaide Oval to protect their interests.

This will leave the problem of what to do with Footy Park. Selling some of the outlying property may free up some capital which can be better invested but I find it hard to justify the on-going ownership of a 50,000 capacity stadium which would seldom be used. This would then be a financial drain on the SANFL.

No doubt all of these factors will be considered by the SANFL and maybe the training facilities for the Crows can justify some of the capital tied up in Footy Park. I would think that with the Power facing financial problems that a possible solution would be to have both the Crows and the Power use Footy Park as a training ground.

There are many factors which need to be weighed up before I would be convinced that this is a good move but it has potential.

[Hondo]

If they get the same match day return from AO then they could just sit on AAMI Stadium for a few years at least and see what can be done with it.

What I was trying to say is that the only reason AAMI Stadium would ever be sold would be if it stopped being used in which case it's terminal value is whatever they can sell the land to developers for or what they could get as a return from redeveloping the property themselves.

They could build a theme park there if they wanted, for example. However, I think everyone involved would prefer that a secondary sports stadium be available if needed .. ie, soccer world cup.

So you make a fair point about the declining value of AAMI especially with no further major upgrades. It's just whether that "value" is ever real or just theoretical. In this case, the "value" only becomes real if it was sold which would be because there's no AFL games there. That's unless the SANFL were ever contemplating selling it while AFL games are still being played there ... which they wouldn't.

I am not sure if a fractional ownership of AO is possible or even if it's necessary.

That's how I see it anyway. There's a lot of water to go under the bridge on this deal as you say.

[doggies4eva]

I don't know who owns Adelaide Oval but an arrangement could always be made - for example when Netball was planning on leaving the Findon Basketball stadium BASA offered to sell the stadium to a separate entity and for each organisation to own shares in the new entity. It never happened because the govt came along with $Ms of taxpayers money which resulted in both organisations struggling. History could repeat

[Hondo]

The SANFL may want to keep their options open for their own CBD Stadium down the track and just use the AO as needed without tangling up ownership issues?

Who knows