Eden Park is in big financial trouble and could run up losses of $80 million over the next decade, says a report commissioned by Auckland Council.
Eden Park is pleading for $100 million from Auckland ratepayers as mounting financial pressures put at risk its ability to host All Black tests and other major events.
The Eden Park Trust has asked Auckland Council to take over a $40m loan and provide $64m for maintenance over the next decade, prompting one council source to call it "a $100m bailout".
A report done by consultants EY for council four months ago paints a bleak financial outlook for the city's premier stadium, saying revenue is falling and there is no money for new turf, floodlights and giant video screens. It faces losses of $80m over the next decade.
The council needs to do what it can to help Eden Park and not kneecap them through the Venue Development Strategy that takes cricket away.
What's more, this year's Rugby World Cup in Japan would result in the loss of one of two lucrative All Black tests, just two of the usual four cricket internationals and other revenue challenges meant the trust would be unable to pay interest costs of about $1.5m, EY said.
In the past fortnight, Auckland councillors have been called to confidential workshops to hear pleas from Eden Park Trust and Regional Facilities Auckland for $91 million to transform Western Springs into a cricket oval for tests and international one-day and T20 matches.
As well as the increased scale and cost of the cricket oval, the council's regional facilities arm plans to downsize QBE North Harbour and Mt Smart stadiums to "community stadiums".
The large sums of money are seriously worrying the mayoral office, where Mayor Phil Goff is trying to focus on housing and transport issues, including a possible $500m to $1b blowout on the $3.4b City Rail Link.
In a statement, Goff said Eden Park's financial position was not sustainable and indicated a willingness to help in a way that protect's ratepayers' interests.
He said the council would expect a "commercial rate of return" on the $40m loan when it terminates this year. The trust currently pays the interest on the loan but has been unable to pay down the capital.
The Mayor said the council had made no decisions about the $64m sought by the trust for maintenance, but his personal view was that any money be secured as a loan rather than a grant.
That would protect ratepayers in the event Eden Park was sold, Goff said.
It is understood Goff wants to resolve the difficulties at Eden Park before tackling Regional Facilities' latest "Venue Development Strategy" for stadiums.
Eden Park Trust chairman Doug McKay said all nine members of the trust and senior managers attended this Wednesday's workshop for a "full and transparent conversation". Photo / Greg Bowker
Eden Park Trust chairman Doug McKay said all nine members of the trust and senior managers attended this Wednesday's workshop for a "full and transparent conversation" around the situation at the park, the findings of the EY report and the $40m loan that terminates in September.
He said the trust was asked what it would take to keep to keep the park running on a sustainable basis and responded $64m was required for a 10-year maintenance plan, which includes $3.5m for a new turf and $5.6m for floodlights.
The $40m loan was a matter for the council after September, he said.
McKay said the trust would like to have a closer relationship with the council in the running of the park, but said legislative changes would be needed to change the governance structure of the trust.
Albany councillor John Watson. Photo / Nick Reed
Albany councillor John Watson said there was some sympathy around the council table for helping Eden Park, which had been unable to pay down the $40m loan underwritten by council to complete an upgrade for the 2011 Rugby World Cup.
"The council needs to do what it can to help Eden Park and not kneecap them through the Venue Development Strategy that takes cricket away," he said.
