Chapman, addressing media to announce a new jumper sponsorship between the football club and telco Optus, said the club had never heard about the controversial hotel proposal before details were dropped to News Corp late last year.
“We found out about that from you guys, the media,” he told reporters today.
“We haven’t been engaged around that discussion, and what it means to revenue streams – indeed what it might mean to expenses and risk.”
However, he added, “good on the [Stadium Management Authority] for looking at alternative revenue streams”.
“It’s getting harder and harder to make this all work – I support anybody that’s looking at alternative revenue streams,” he said.
Chapman, a former managing director of Bank SA and CEO of St George Bank, was asked what he’d expect the commercial rate of interest would be on a bridging loan the SMA has obtained from the Commonwealth Bank for the new development.
“It’s a fair question to ask, to be honest,” Chapman said.
“I’m not trying to be Sachin Tendulkar and bat this straight back [but] I’m not quite aware of everything that’s gone on… bridging loans of this nature [it would be] several per cent.
“I’d suggest 4.5 would be at the low end of the spectrum.”
While Planning Minister Stephan Knoll said today the loan was granted on the back of the Marshall Government committing to its own loan of $42 million to the SMA, the chairman of the SMA, Kevin Scarce, later confirmed that the bridging finance was secured at a rate of 4.6 per cent and guaranteed by the SACA and the SANFL.
Chapman said it was “really hard for us to make any sensible comment” on the development because “we’ve got no line of sight on it”, but “I applaud them for looking at other revenue streams”.
He said the club would welcome more engagement with the SMA about the facility “because it will help us in our own business-making decisions about how we can make the experience better for our fans and members”, noting that the cost of attending Adelaide Oval was “an issue” for those fans and members.
“We’d like to be more involved,” he said.
Please don’t change our beautiful stadium!
— Tex Walker (@texwalker13) December 14, 2018
Knoll today rejected that the bank loan for the SMA undermined the government’s rationale for investing in the project – because it was unable to otherwise secure funding – telling ABC Radio Adelaide “the only reason that they were able to get bridging finance was because there was a government loan in place”.
“That government loan is lawful and it’s why they’ve had to go and get bridging finance in the first place – the only reason that they were able to do that is because the bank was comfortable with the fact that there was a future loan that was being provided [by] the Government,” he said.
But Opposition spokesman Stephen Mullighan said the SMA had sought a commercial loan in a bid “to try and start construction early”, and arguing the Government loan had been delayed “in an attempt to bypass a law which prevents further money being spent at Adelaide Oval until the end of the year”.
The Adelaide Oval Redevelopment and Management Act 2011 prevents taxpayer money going towards developing the precinct beyond the original cap of $535 million until December this year – a clause inserted amid an outcry over escalating costs.
“If the government is providing any form of guarantee or security for this loan they are in breach of the law,” Mullighan said.
In a statement this afternoon, SMA chairman Scarce said the loan was guaranteed through the organisation’s joing venture partners, SACA and the SANFL.
“As the SAFA loan facility does not come into effect until December 2019, we have sought bridging finance as per our submission to allow us to meet our intended timeline of starting construction in the middle of this year,” he said.
“As a private company entering into a commercial arrangement with a third-party provider, we are entitled to keep this information confidential.
“However, in the interests of continued transparency, I can confirm that this bridging finance has been secured from the Commonwealth Bank at a rate of 4.6%. I can also confirm that the loan is guaranteed by the Adelaide Oval SMA Ltd. through its joint venture partners of SACA and SANFL who are responsible for the associated interest payments. It is not guaranteed by the State Government or, by extension, taxpayers. This has all been factored into our budgeting for the hotel.”
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