Disaster averted: Lessons from a property turnaround
Optimising your club's property assets can pose significant challenges. For clubs seeking to navigate this journey, especially in the intricate landscape of property development, the importance of professional property development advice cannot be overstated.
The challenges faced by clubs in property development
Property developers are seasoned professionals in their specialised field whereas club executives are focused on the operation of their club. This discrepancy in knowledge and expertise often results in developers leading clubs into agreements which are less valuable and riskier than the club anticipates, with potentially serious negative consequences for the club.
Why clubs need property development advice?
Club executives, despite their expertise in managing clubs, may lack the nuanced understanding required for successful property development. Professional commercial property advice and support is available to enable clubs to realise development potential whilst protecting themselves from bad deals, empowering club executives to achieve maximum returns while minimising risk.
Caringbah Bowling and Recreation Club (CBRC)
The experience of CBRC serves as a compelling example of the importance of expert property development advice. Facing financial pressures and in dated and inefficient premises, CBRC initially contemplated participating in the development of a neighbouring property as a potential solution. Augusta Advisors conducted an expert review discovering that the terms negotiated by the developer were far from favourable for CBRC and in fact had the potential to exacerbate the club's financial troubles and possibly lead to its closure.
Fortunately, this advice was received by the club before a formal agreement was finalised. With ongoing guidance from the team at Augusta Advisors CBRC extricated itself from this precarious situation and secured an alternative and better development partner under significantly improved commercial terms for the club.
“Taking the advice from August Advisors prevented the club from making a potentially severe mistake and has ensured its survival and prosperity”
The transformation of CBRC
The process culminated in the negotiation and execution of a Project Development Agreement, a substantial legal document designed to protect the interests of CBRC. Since then, Development Approval has been obtained for new state-of-the-art club premises, two new bowling greens, basement parking for club patrons and 244 apartments with 50% earmarked as affordable rental units. Construction has commenced and CBRC is anticipated to occupy its new premises by mid-2025.
Barry Whitton, CBRC's Chairman, confirmed that “taking the advice from August Advisors prevented the club from making a potentially severe mistake and has ensured its survival and prosperity. Thanks to that CBRC now anticipates a bright and secure future and maintaining its valuable contribution to the Caringbah community.”
How you can maximise your club’s potential with August Advisors:
CBRC's experience underscores the pivotal role that expert advice and support plays in using property assets to secure the future of clubs. With such assistance you can expect:
A new, fully fitted out club: We encourage envisioning a brand new club to drive motivation and set the tone for a transformative journey.
Diversified revenue sources: We emphasise the importance of exploring revenue streams beyond gaming, such as from commercial, residential, or retail tenants, ensuring financial stability.
Protection against developer exploitation: We highlight the need for vigilance and professional guidance to safeguard against the significant risk of exploitation by developers in the property development process.
To visualise success: We stress the significance of visualising success, helping stakeholders understand the positive impact of a revitalised club on their overall vision and objectives.