$300m lifeline to save sharks
The Sunday Telegraph; By David Riccio; 23 January 2011
 

A MULTI-LEVEL shopping centre, complete with outdoor eateries and beer gardens, entertainment zones for the kids and a residential estate that sits alongside a redesigned Toyota Stadium.

This is the $300 million development that can save the Cronulla Sutherland Sharks once and for all.

The Sunday Telegraph was last week invited to a presentation of the Sharks' latest development proposal, joining corporate heavies and private sponsors as a consortium of leading property developers detailed their bid to transform the club pauper to prince.

The plan: the proposed property development of the Cronulla Sharks club. Source: The Sunday Telegraph

Cronulla members will get their first glimpse of the detailed proposal in eight days.

They will then be asked to determine the club's fate at an extraordinary general meeting on February 21. It shapes as the most significant night in the club's 44-year history.

"I'm under no illusions that there's still a lot of hard work to be done, but after seeing the proposal it's hard not to be impressed," Cronulla captain Paul Gallen said.

"The consortium have made a huge amount of good ground already, so it would be nice for everyone involved with the club if that was to continue so positively."

Since 1999, much has been written and said about Cronulla's bid to sell-off land adjoining Toyota Stadium.

The broken promises from previous boards have been outweighed only by the frustration of Sharks fans.

A lack of leadership has left the club wallowing in a $12 million debt. But this time, under the guidance of a young board headed by chairman Damian Irvine, the Sharks might be about to swim clear of the red ink.

As Irvine declared during last week's presentation: "We've now got the tools, the right people and the right plan. It's time for action."

Irvine and his board are being guided by a consortium of property developers from Capital Corporation, Parkview and Bluestone Property Solutions. The proposal represents a new vision for the club.

Their goal is to rid the club of debt for the first time in 12 years, reposition the Sharks as a market leader in the community and entertainment precinct, keep the team in the Shire and create an ongoing income stream.

The consortium was appointed in November following an expression of interest campaign conducted by David Hynes, executive director of Winston Langley Property development. It came after a report into the previous board's development proposal was found to be "unviable".

Gone are the plans of 18 months ago of building 145 "lifestyle" apartments for over-55s. Instead, the new proposal calls for a retail and entertainment facility that intends to transform over two hectares of bitumen car park adjoining the leagues club into an integrated development with retail shops, sporting complexes, corporate meeting facilities, outdoor bars and family entertainment.

Upon entering a development agreement, the consortium will advance an agreed up-front payment of $2 million that will go straight into the Sharks' coffers.

But it's the ongoing income stream from the retail arm of the development that should get Cronulla fans excited. The Sunday Telegraph has learned that the club is likely to pocket more than $1m annually.

It's understood major players such as Woolworths, Aldi and Coles have already shown preliminary interest in the development.

The residential development, which would house in excess of 500 dwellings, on the western side of Toyota Stadium could also deliver a profit stream for the Sharks.

While Irvine and his team are refusing to get ahead of themselves, the consortium has the power and experience to get things moving.

In just under two months, they have already met Sutherland Shire Council, Department of Planning and State Planning Minister Tony Kelly, while meetings with the club's financial lifeline, St George Bank last week, delivered positive feedback.

Irvine believes the deal is the right one for the Sharks.

"The consortium will advance the Sharks $2m up front, if members vote in favour of the proposal at next month's EGM," Irvine said.

"A big part of this process was to get an up-front commitment from the development partner that we choose, without sacrificing long-term returns. The club will retain ownership of the land for the retail component and the club building, along with Toyota Stadium, receiving perpetual rental on the space.

"Further, the residential development will also deliver profit streams for the Sharks from a percentage of the gross revenue."

The development would attract up to 400 new jobs while the green light from members on February 21 could see soil turned on the Woolooware site as early as next year.

The consortium has the passion and drive to see the development through.

Both Ben Fairfax, managing director of Bluestone Property Solutions, and Parkview Property development manager, Matt Crews, live in the Shire.

But listening to their pitch, you can't help but think, "do these guys really know what they're in for?" Fairfax insists they do.

"We will walk the members through our vision for this exciting integrated development and our strategy to deliver an outcome that will secure the long-term financial viability of the club," Fairfax said last week.

"This isn't about delivering hollow promises to the club and its members. There is a lot of hard work to go and we will get a lot of knock-backs along the way. However, there is the opportunity to deliver a leading edge integrated master planned development and reposition the Sharks Leagues Club and entertainment precinct as a destination location in the community."

For Irvine and his board, who have spent countless board meetings debating the proposal, February 21 can't come quickly enough.

"The most important thing we've achieved here is that at no cost to members we now have the mechanisms and structures in place to guarantee that we will get best use out of the land," Irvine said.

"We've looked at the entire land holding as opposed to a little pocket of holdings, which is what had happened in the past.

"It would be a relief [if the proposal was accepted] to finally deliver a return on our land assets for our membership and retire the debt once and for all.

"The benefits such a development will bring to our community and football club are massive and will place us in a very strong financial position to compete off-field and on-field with financial support unprecedented in our club's history."