Auckland Council proposes $63 million loan bailout for Eden Park

Friday, 15 March 2019

Eden Park has seen it all in sport - but 2020 and Covid-19 has brought new challenges

Auckland councillors are to consider $63.3 million worth of loans to bail out Eden Park, which is expected to seek new planning rules to stage concerts.

The loan package mostly replaces $46.5m of existing council commitments to the stadium, a $7m bank loan, and adds $9.8m for essential maintenance.

A council report confirms the Eden Park Trust 'has indicated' it will be seeking a relaxation of planning rules for up to six concerts a year.

Eden Park could receive a $63 million loan bundle from Auckland Council

The proposal would allow the stadium to renew its ageing turf next year, and upgrade the North Stand and other facilities over three years.

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The significant new element of council support for Eden Park is $9.8m of lending available for three years to enable an agreed programme of maintenance.

The biggest items are $1.5m to replace the stadium turf which is more than twice the ideal seven-year age for use, $2m to upgrade lifts in the North Stand, and $2m to refurbish kitchens.

A detailed agreement would have to be reached between the council and the Eden Park Trust Board, for the money to be provided.

That loan bundle is significantly less than the trust board's request for $64m worth of grants over the next decade.

It excludes some items which the council calls 'non-essential' and for which funding may be available elsewhere.

'Such items may include video replay screens, replacement of field lighting, CCTV upgrades and upgrades to player changing rooms,' said the report to next Tuesday's Finance and Performance committee.

Mayor Phil Goff said the council wasn't prepared to make a 10-year commitment on the maintenance list.

'We want to see, before making any forward commitment , what their financial position will be three years out,' Goff told Stuff.

The report confirms comments made on Friday by Goff, that the trust board wanted fewer restrictions on staging concerts.

'Additional events are expected to significantly improve the financial performance of Eden Park Trust within a three-year period (based on the time needed to obtain the consent and schedule in a programme of concerts or other events).'

Eden Park presently has the right to apply for consents for up to six concerts a year, but has so far shied away from what can be a lengthy and costly planning process.

If concerts were to be deemed a 'permitted' activity in planning rules, Eden Park could stage them almost as of right, with some conditions.

Goff wouldn't directly answer Stuff's question on whether the loan package came with an understanding the stadium should seek less restrictive rules on staging concerts.

'I think the Eden Park Trust Board needs to look at how it can optimise the use of their facilities, and much of that may be uncontroversial,' said Goff.

'Their chief executive is striving to get better utilisation - I think we've got to keep pressure on the trust board to keep on doing that.'

A major part of the package which councillors will consider, is a repackaging of existing council support.

The deal has been sparked by the need for Eden Park to repay a $40m loan to ASB Bank, which the council guarantees, and has already moved onto it's books.

The stadium can't afford to repay the loan, and said it also can't afford $64m of essential maintenance in the coming decade.

A report commissioned by the council from consultants Ernst and Young, forecast the stadium could run up losses of up to $80m in the next decade.

The council proposal also includes a $6.5m loan which the council made to Eden Park in 1999.

On top of that is replacing a $7m 'facility' the stadium has at ASB, which allows it to draw money for a short term, and a separate $500,000 overdraft.

The Eden Park Trust Board on Friday declined Stuff's request for comment on the possibility of it seeking Environment Court approval to more easily stage concerts.

That move could be a political hot potato with local body elections in October, even though the council itself would not take a stand because of its role as regulator of the planning rules.

It will also attract both fervent support and opposition from the neighbourhood around the stadium's suburban Sandringham location.

Tuesday's meeting follows 10 months of largely confidential negotiation of how the council might support the trust-owned stadium.

A confidential council plan approved in May 2018 hoped the Government would share 50-50 with the council the stadium's $6.4m maintenance needs.

That May 2018 report has been made public and shows the Government rejected any funding support last November in a letter to the mayor.

Eden Park's Trustee and management met councillors behind closed doors in February, and councillors on Thursday considered the latest plan in a confidential workshop.

The Finance and Performance Committee will consider the plan in public on Tuesday, with an appearance also scheduled by the Trust Board.