WACA MUSINGS I
WACA MEMBERS ONCE AGAIN NEED TO ASK A LOT OF QUESTIONS!
The WACA was last refurbished in circa 2002, it did so without fanfare but a time when Premier Alan Carpenter’s Government was wanting to move cricket to Subiaco Oval. (WACA wins turf war with Subiaco Oval)
For the last 20 years the WACA’s successive administrations have struggled to achieve further refurbishment but for an upgraded media centre before the 2015 Cricket World Cup.
The WACA entered into a disastrous deal with Ascot Capital (Ripple Holdings) in 2009 under CEO Graeme Wood and Chair David Williams to re-zone and develop large tracts of the WACA into apartment towers to fund an upgrade.
That deal left the WACA with a noose around its neck in the form of a contingent value uplift fee payable if any of the land the subject of the development agreement is later sold or leased not in accordance with the original agreement with Ascot Capital.
WACA Members had the opportunity to read and vote on that agreement in 2009. I was the only Member to take up the opportunity to read the agreement and could not believe what the WACA was proposing to sign but my calls of concern were ignored until Board Member George Jones AM resigned in 2013.
George Jones was anointed incoming Chair to replace David Williams but resigned beforehand over the agreement with Ascot Capital and publicly encouraged Members to “ask a lot of questions about it.”
We now fast forward to 2021 and WACA Members would once again do well to follow Mr Jones’ advice and “ask a lot of questions” but this time about the WACA’s proposed pool deal with the City of Perth.
The City of Perth is the second largest CBD landowner behind the State Government.
The balance sheet comparisons between the WACA and the City of Perth are chalk and cheese. The City of Perth has net assets of $1.2 billion compared to the WACA’s $10.7 million. On parking revenue alone, the City of Perth generates nearly double the WACA’s total annual income.
The City of Perth is also not short of land. One just needs to look at the four city block sized, ‘at grade’ public carparks adjacent to the WACA as a small example of the City’s landholdings.
So why then is the WACA entering into a deal that would give up valuable WACA land to the City of Perth for a pool?
Under questioning by myself at a Members only briefing on 24 March 2021, the night before the WACA’s media announcement of its latest refurbishment, and in response to written questions submitted by myself after the briefing it is not because of:-
1. Any positive financial return;
2. Any condition of the State or Federal Government’s $30 million (each) grants; or
3. To ensure the upgrade of much needed cricket facilities and other ground infrastructure.
Pool concept image presented to WACA Members 24 March 2021.
CEO Christina Matthews and Chair Terry Waldron made it very clear the WACA upgrade will occur with or without a pool and the pool was not a condition of any government grant.
As for the financial return, it is another noose around the neck of the WACA because the WACA proposes to grant the City of Perth a 40 year peppercorn lease over valuable WACA land for the City to build and operate a pool – think of the large tract of land between Shepherd Gates and the Prindiville Stand on the corner of Nelson Crescent and Hale Street.
The principal governance and financial questions for the WACA Board in the Members’ interests are, “What is the highest and best use/return for the land being proposed to be leased?” and “What is the opportunity cost to the WACA of the proposed 40 year peppercorn lease deal?”
This land was once so valuable it was going to contain dozens and dozens of apartments, now it is worth a peppercorn?
In answers to my questions, the WACA does not know the area of land to be leased or the value of land to be leased. I find that concerning before proposing a 40 year peppercorn lease.
I suspect the opportunity cost to the WACA of a 40 year peppercorn lease will be quite significant and increasingly so in coming years.
The Perth CBD is the only CBD in Australia with major at grade public carparks in its heart and 80% of them sit opposite the WACA, owned by the City of Perth. The other 20% sit in front of the Perth Concert Hall.
These are all likely to be developed over the next 5, 10, 15 or 20 years – particularly such prime land opposite Queens Gardens and the WACA.
This then makes the WACA land proposed to be leased to the City of Perth for a peppercorn very valuable.
The message to Government should be, “Let us retain this land as a future revenue stream for the WACA. Proceeding with a 40 year peppercorn lease will only result in the WACA knocking on Government’s door for more money in 10, 20, 30 and 40 years’ time.”
WACA Members need to ask a lot of questions about this pool deal and the WACA Board needs to ensure that the lease deal is presented in full to Members for ratification or not at a General Meeting.
(I have been a WACA Member since 1986/87 and was elected to the WACA Board after the resignation of George Jones AM in 2013, serving for 2 years.)