Farry responds to concerns

Carisbrook Stadium Trust chairman Malcolm Farry has defended his organisation against peer reviewers' suggestions it ‘‘excluded'' items necessary for the stadium, which would require funding, from its reports.

He said one item identified as an exclusion was a tram link and station, something the trust was not planning: ‘‘Their list of exclusions is not a list of exclusions.''

The reviews were ordered last year by the Dunedin City Council so councillors could get an independent assessment of the Carisbrook Stadium Trust's work.

Questions have been continually raised about the trust's investigations, including whether the stadium could be built for $188 million, and whether the trust's assertion it would make a profit was correct.

Davis Langdon was asked to review progress made by the trust, Creative Spaces looked at the stadium's design, Rider Levett Bucknall design and construction costs, and PricewaterhouseCoopers the stadium's operating forecasts.

The Davis Langdon review noted the trust was asked to provide ‘‘certain documents''.

‘‘At this point in time [March 8] some information is still outstanding. Consequently, this report is limited in its coverage and the areas we still have to review are noted in this report.''

Davis Langdon found the design had been developed in accordance with internationally recognised standards. But the report suggested ‘‘independent expert verification'' to confirm the health of turf under the ethylene tetrafluoroethylene (EFTE) roof, as well as a corrosion protection strategy and maintenance regime.

Construction costs, including contingency and escalation allowances, were within normal estimating tolerances.

The report noted budget ‘‘exclusions'', including necessary infrastructure upgrades such as the realignment of State Highway 88, which the council would need to consider when taking a holistic view of the entire project.

Other items excluded included a kitchen fitout, broadcasting facilities, electronic turnstiles, score boards and replay screens.

But Mr Farry said the State Highway 88 realignment was in the Dunedin City Council's transport strategy, and was not a cost to the trust.

A kitchen fit-out would be the responsibility of whoever took a contract to run the facility, a situation that was ‘‘very commercially common''.

Broadcasters would provide their own technical requirements, he said.

Turnstiles and replay screens could be hired, as they were only needed for big events, though there was a possibility of having screens as part of a sponsorship deal.

Mr Farry did not know why reviewers did not ask him about the items they considered to be excluded: ‘‘They never ever came and spoke to me.''

The review said depreciation had been excluded from the forecasts, and ‘‘we have been advised this may run into several millions of dollars per annum''.

Mr Farry responded that the council had included depreciation in its $91.4 million funding package as a ‘‘start-up fund'', and the trust had included money for maintenance.

Davis Langdon's report said interest had been specifically excluded from the forecasts.

Mr Farry said he thought reviewers were referring to interest the trust would incur.

The trust might need bridging finance, depending on the timing of private sector finance, but that would be covered by money it raised from the sector.

Creative Spaces' report said the stadium would have ‘‘excellent'' sight-lines, minimum viewing distances and generally good access to food and beverage outlets and toilets, ‘‘resulting in an enjoyable and memorable experience for spectators''.

But the growth of turf under the roof was ‘‘a significant risk'', and Creative Spaces recommended new generation artificial turf be investigated.

The architectural form of, and material selection for the stadium was a logical development of the initial concept, and the exposed roof structure and arrangement of cladding ‘‘provides a robust, dynamic and memorable image'', the report said.

‘‘However, it is considered the treatment of the south facade overlooking the Leith requires further development to achieve a similarly successful architectural and urban design response as the other facades.''

The approach to the durability and maintenance of the materials was appropriate to the marine environment and the wear and tear they would receive.

The Rider Levett Bucknall review of design and construction costs outlined a potential increase of $3.6 million to the estimated cost of the stadium.

But based on increases in construction costs of 4% per annum, the report said escalation costs would total $11.1 million, $1.1 million less than the amount included in the trust's cost plan.

It said a contingency allowance of $13.9 million was prudent, due to the conceptual nature of the design.

PricewaterhouseCoopers pointed out the risk inherent in the trust's 15-year operating forecast, a risk accentuated by potential changes that could occur in rugby, ‘‘which is the principal source of revenue for the stadium''.

‘‘The game will evolve. The issue for the stadium is whether the evolution will mean that rugby will generate the level of revenue for the stadium assumed in the forecasts.''

Concerts were a major contributor to the revenue forecasts, and the review acknowledged having a roof on the stadium would give it ‘‘considerable flexibility'', and enhance its attractiveness to promoters and performers.

The trust's forecasts for concerts were ‘‘modest''.

The sources of revenue identified by the trust were not unusual for the stadium, but PricewaterhouseCoopers ‘‘noted a number of issues with regard to individual revenue items''.

‘‘Our overall view is that the revenue forecasts are at the upper end of expectations. We would not describe them as conservative.''

One determinant of success would be the extent the Otago community supported the stadium and its events. The precedent had been set with Wellington's Westpac Stadium, which successfully lifted attendances compared with the final years of Athletic Park.


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