[APP] Adelaide Oval Hotel

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[APP] Re: Adelaide Oval Hotel

#481 Post by SRW » Wed Sep 18, 2019 8:15 am

I think the food and beverage prices are a legitimate news angle, as they do matter to people and factor into their decision to attend the oval. However, this ABC article reveals a bit more of the double taking by SMA/SANFL/SACA:
Adelaide Oval's food and drink prices set to rise as authority looks to offset low attendance
Leah MacLennan, 17 September 2019, ABC News

The cost of food and drink at Adelaide Oval is likely to go up again, with the Stadium Management Authority (SMA) saying poor performances by both local AFL teams are partly to blame.

Key points:

Football and cricket attendance at Adelaide Oval dropped significantly over the past year
Poor performances by the Crows and Power, and bad weather, have been blamed
The Government says the decline strengthens the business case for a controversial hotel
The SMA revealed the pending price increase at a parliamentary committee set up to probe a controversial $42 million luxury hotel development at the ground.


The authority's chair, former South Australian governor Kevin Scarce, told the committee while a final decision had not been made, price rises would be kept to a minimum, with details to be announced in November.

"Numbers go up and down depending on timing, performance," he said.

"My expectation is that any increase in price will be well below the costs charged by our suppliers."

Rear Admiral Scarce said prices at the oval remained competitive compared to similar venues, pointing out a full-strength beer at the Gabba cost $10.30, while in Adelaide it is $9.50.

According to an AFL price guide provided to the committee by the SMA, the oval has the most expensive pies of any stadium, but has the cheapest hot dogs, coffee and small soft drinks.

Image
A table showing the differences in food and beverage prices between Australian stadiums. Photo: The AFL 2019 price guide shows the comparison in prices between stadiums in different states. (Supplied)

While the Gabba has the most expensive beer, the Sydney Cricket Ground (SCG) leads the pack in most other categories.

It was revealed that part of the cost pressure came down to a significant drop in attendance at cricket and football matches at the oval this year, with Adelaide and Port Adelaide both failing to make the AFL finals.

Rear Admiral Scarce said attendance at AFL matches dropped by 50,000 over the course of the season, Big Bash League crowds were down about 11,000 per match, and last December's cricket Test against India drew 90,000 fewer patrons than the Ashes.

He blamed poor performances by the Crows and the Power, along with bad weather, for the drop in football attendances, saying the oval had already cut staff through natural attrition to rein in costs.

Decline highlights need for hotel, Government says

Beer, soft drink and food prices at Adelaide Oval have been a constant source of frustration for fans, with then premier Jay Weatherill accusing the SMA of "fleecing" supporters in 2016.

"I can't comment on what the pricing will be but I can say that we are absolutely aware of the issue of food and beverage pricing," SMA CEO Andrew Daniels said.

"I'm sorry that they pay increases, I have to pay increases, everybody has to pay increases as costs go up.

"The reality is a fabulous asset like the Adelaide Oval is incredibly expensive to maintain, to run, to upkeep."

However, Shadow Treasurer Stephen Mullighan said prices were already unaffordable and future rises would drive more people away.

"Rather than blaming the weather or blaming the performance of our two AFL teams, maybe the SMA should be asking families whether $50 for a round of drinks and some hot chips is too much," he said.

"It's no wonder people are choosing to go down to the supermarket and sit at home on the couch and watch the football rather than come to Adelaide Oval."


Infrastructure Minister Stephan Knoll said the decline in attendances over the past 12 months strengthened the business case for the hotel.

"This hotel will help to provide a better financial position for the oval," he said.

"This is a great asset but it does have some frailties … we cannot continue to rely on record crowds to make sure that the oval functions properly."

Rear Admiral Scarce told the committee construction was on track for to be completed next July, and start taking bookings in September.

He said fluctuations in attendance were only to be expected, and helped to illustrate why the SMA has decided to build the hotel.
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[APP] Re: Adelaide Oval Hotel

#482 Post by rev » Wed Sep 18, 2019 10:40 am

Part of the decline can be attributed to the rise in the cost of attending Adelaide Oval, ie food & drinks.
The prices went up last year I think. There wasn't an issue of declining crowds then. There is now, so they are using it as an excuse to jack prices up again.
That's what happens when you have so many greedy snouts in the trough instead of having an independent body.

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[APP] Re: Adelaide Oval Hotel

#483 Post by LMB » Wed Sep 18, 2019 11:37 am

I would be curious to see the hotels financial modelling and what their profit forecasts are based upon?

Quick scenario to consider:
39 event days at Oval per annum ( 22 AFL, 1 SANFL, 15 Cricket, 1 concert)
On event days they would be getting a room rate of $300 per room.
$300 x 138 rooms = $41,400 revenue per night
$1,614, 600 is their total annual accommodation revenue from event days, assuming they're full.
Approx 25% profit would be the market expectation, so around about $400,000 per year total profit from event days.

Then there's another 326 days of the year that the hotel needs to consider. My expectation is that occupancy will be considerably less than 100%. Let's give them 70% until the novelty wears off.
The average rate will also be considerably less. If they're competing directly with CBD 5 star properties let's say an average rate of $180 per night
You can calculate the revenue and profit from there and they'll be lucky to be banking profit of $2000 per day.

So I don't understand how they are planning that most of the profit each year will repay the loan, plus $600,000 to Adelaide Oval, and the rest to be split between SACA and SANFL???
What are they basing their figures on? Is it just me or is someone viewing the revenue and profit potential through rose coloured glasses?
I believe the hotel will be lucky to have a Net Profit of $800,000 per year.

All this before things start to go wrong and property upkeep is required...
The consistency of service will also be below par because it will need to be a largely casual team due to only having 39 event days per year and 326 days of uncertainty.

Maybe I've given this all too much thought but seriously, I cannot see how this project is viable.
Oh wait, it's only viable because the taxpayer will repay the loan when it fails.

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[APP] Re: Adelaide Oval Hotel

#484 Post by Nathan » Wed Sep 18, 2019 12:24 pm

I don't see the complaint about food and drink prices. It's no different to pricing at any other captive venue or event, and it should just be assumed there's some kind of premium on them. Comparisons between other stadiums on who is 10 or 20c cheaper/dearer for a pint and some hot chips is dumb, as is the complaints if they go up by that much. Oh, the beers have gone up by 20c? Even over the course of the season that's hardly much of a change. At best it's a minor whinge, rather than something that should be a major focus when talking about the bloody hotel.

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[APP] [APP] Re: [APP] Re: Adelaide Oval Hotel

#485 Post by Waewick » Wed Sep 18, 2019 9:39 pm

LMB wrote:I would be curious to see the hotels financial modelling and what their profit forecasts are based upon?

Quick scenario to consider:
39 event days at Oval per annum ( 22 AFL, 1 SANFL, 15 Cricket, 1 concert)
On event days they would be getting a room rate of $300 per room.
$300 x 138 rooms = $41,400 revenue per night
$1,614, 600 is their total annual accommodation revenue from event days, assuming they're full.
Approx 25% profit would be the market expectation, so around about $400,000 per year total profit from event days.

Then there's another 326 days of the year that the hotel needs to consider. My expectation is that occupancy will be considerably less than 100%. Let's give them 70% until the novelty wears off.
The average rate will also be considerably less. If they're competing directly with CBD 5 star properties let's say an average rate of $180 per night
You can calculate the revenue and profit from there and they'll be lucky to be banking profit of $2000 per day.

So I don't understand how they are planning that most of the profit each year will repay the loan, plus $600,000 to Adelaide Oval, and the rest to be split between SACA and SANFL???
What are they basing their figures on? Is it just me or is someone viewing the revenue and profit potential through rose coloured glasses?
I believe the hotel will be lucky to have a Net Profit of $800,000 per year.

All this before things start to go wrong and property upkeep is required...
The consistency of service will also be below par because it will need to be a largely casual team due to only having 39 event days per year and 326 days of uncertainty.

Maybe I've given this all too much thought but seriously, I cannot see how this project is viable.
Oh wait, it's only viable because the taxpayer will repay the loan when it fails.
The Oval hosts a lot of non sport related corporate events every month, something even more attractive now there is a hotel.

Its a unique offering only 100 metres across from the convention centre and Casino.

It will make money. Management might be a problem, but that's the case anyway.

For me, the cost of food and beverage is far more of an issue as I have to pay for it. I'll happily accept premium, but they gouge purely and simply.




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[APP] Re: [APP] Re: Adelaide Oval Hotel

#486 Post by citywatcher » Wed Sep 18, 2019 11:12 pm

Nathan wrote:I don't see the complaint about food and drink prices. It's no different to pricing at any other captive venue or event, and it should just be assumed there's some kind of premium on them. Comparisons between other stadiums on who is 10 or 20c cheaper/dearer for a pint and some hot chips is dumb, as is the complaints if they go up by that much. Oh, the beers have gone up by 20c? Even over the course of the season that's hardly much of a change. At best it's a minor whinge, rather than something that should be a major focus when talking about the bloody hotel.
Remember though there is a game on EVERY weekend
Having looked at the plans and costings more closely this hotel is a crock in my opinion

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[APP] Re: Adelaide Oval Hotel

#487 Post by ChillyPhilly » Wed Sep 18, 2019 11:36 pm

Nathan wrote:
Wed Sep 18, 2019 12:24 pm
I don't see the complaint about food and drink prices. It's no different to pricing at any other captive venue or event, and it should just be assumed there's some kind of premium on them. Comparisons between other stadiums on who is 10 or 20c cheaper/dearer for a pint and some hot chips is dumb, as is the complaints if they go up by that much. Oh, the beers have gone up by 20c? Even over the course of the season that's hardly much of a change. At best it's a minor whinge, rather than something that should be a major focus when talking about the bloody hotel.
Comparisons are dumb because the prices make them so pointless: an exorbitant $5.10 for a damn bottle of water, $10 for a tiny little burger or $10.20 for a cup of weak beer.

The SMA is downright wrong to blame fans. They need to look in the mirror. For the first time, fans are citing Adelaide Oval prices as reason to stay away in 2020.
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[APP] Re: [APP] Re: Adelaide Oval Hotel

#488 Post by Waewick » Thu Sep 19, 2019 8:39 am

ChillyPhilly wrote:
Nathan wrote:
Wed Sep 18, 2019 12:24 pm
I don't see the complaint about food and drink prices. It's no different to pricing at any other captive venue or event, and it should just be assumed there's some kind of premium on them. Comparisons between other stadiums on who is 10 or 20c cheaper/dearer for a pint and some hot chips is dumb, as is the complaints if they go up by that much. Oh, the beers have gone up by 20c? Even over the course of the season that's hardly much of a change. At best it's a minor whinge, rather than something that should be a major focus when talking about the bloody hotel.
Comparisons are dumb because the prices make them so pointless: an exorbitant $5.10 for a damn bottle of water, $10 for a tiny little burger or $10.20 for a cup of weak beer.

The SMA is downright wrong to blame fans. They need to look in the mirror. For the first time, fans are citing Adelaide Oval prices as reason to stay away in 2020.
They charge $9 for about 100mls of red wine. You can buy the bottle at Dan Murphy's for $9. They are making 70 odd bucks on that bottle. (100mls is being generous)

As I said, I under stand the need for a premium, but they are not putting a premium on it, they are gouging.

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[APP] Re: [APP] Re: Adelaide Oval Hotel

#489 Post by rev » Thu Sep 19, 2019 12:34 pm

Waewick wrote:
Thu Sep 19, 2019 8:39 am
ChillyPhilly wrote:
Nathan wrote:
Wed Sep 18, 2019 12:24 pm
I don't see the complaint about food and drink prices. It's no different to pricing at any other captive venue or event, and it should just be assumed there's some kind of premium on them. Comparisons between other stadiums on who is 10 or 20c cheaper/dearer for a pint and some hot chips is dumb, as is the complaints if they go up by that much. Oh, the beers have gone up by 20c? Even over the course of the season that's hardly much of a change. At best it's a minor whinge, rather than something that should be a major focus when talking about the bloody hotel.
Comparisons are dumb because the prices make them so pointless: an exorbitant $5.10 for a damn bottle of water, $10 for a tiny little burger or $10.20 for a cup of weak beer.

The SMA is downright wrong to blame fans. They need to look in the mirror. For the first time, fans are citing Adelaide Oval prices as reason to stay away in 2020.
They charge $9 for about 100mls of red wine. You can buy the bottle at Dan Murphy's for $9. They are making 70 odd bucks on that bottle. (100mls is being generous)

As I said, I under stand the need for a premium, but they are not putting a premium on it, they are gouging.
Same thing with beer. What's a carton at Dan Murphys, 40-50? 24 in a carton. Works out to be about $2 a bottle on the higher end.
They're selling beer for about $10. About $190 mark up/profit..but you should also factor in that they get they're probably getting supplied at wholesale price not retail. So bigger profits still.

This is the greedy hands of the SANFL, Leigh Whicker from the SANFL had his own personal catering company doing the f&b at AAMI stadium.
It's all been folded into the SMA I believe..correct me if I'm wrong. Same faces from AAMI stadium.

Even more reason for an independent SMA.

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[APP] Re: Adelaide Oval Hotel

#490 Post by Nort » Thu Sep 26, 2019 1:48 pm

Looks like initial works have started on dismantling some of the Oval facade.

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[APP] Re: Adelaide Oval Hotel

#491 Post by Bob » Fri Oct 11, 2019 1:28 pm

Major construction starts on Adelaide Oval Hotel

https://indaily.com.au/news/local/2019/ ... val-hotel/

One paragraph in particular which quoted Minister Knoll happened to catch my eye...

“It’s also going to return money to taxpayers in the form of dividends and it’s going to keep our world-class Adelaide Oval the best in the country, if not the best in the world.

Silly statements like that is what makes people from interstate have a laugh at Adelaide. Embarrassing coming from a State Minister.

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[APP] Re: Adelaide Oval Hotel

#492 Post by Llessur2002 » Fri Oct 11, 2019 2:06 pm

Bob wrote:
Fri Oct 11, 2019 1:28 pm
Major construction starts on Adelaide Oval Hotel

https://indaily.com.au/news/local/2019/ ... val-hotel/

One paragraph in particular which quoted Minister Knoll happened to catch my eye...

“It’s also going to return money to taxpayers in the form of dividends and it’s going to keep our world-class Adelaide Oval the best in the country, if not the best in the world.

Silly statements like that is what makes people from interstate have a laugh at Adelaide. Embarrassing coming from a State Minister.
I'm not really a fan of Minister Knoll but if it's the last part of the quote you're talking about then that's completely subjective and I think there are many people (including countless sporting commentators and journalists) who would class the Oval among the best sporting grounds in the country/world. But let's not get into this argument again...

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[APP] Re: Adelaide Oval Hotel

#493 Post by Bob » Fri Oct 11, 2019 2:51 pm

Llessur2002 wrote:
Fri Oct 11, 2019 2:06 pm
Bob wrote:
Fri Oct 11, 2019 1:28 pm
Major construction starts on Adelaide Oval Hotel

https://indaily.com.au/news/local/2019/ ... val-hotel/

One paragraph in particular which quoted Minister Knoll happened to catch my eye...

“It’s also going to return money to taxpayers in the form of dividends and it’s going to keep our world-class Adelaide Oval the best in the country, if not the best in the world.

Silly statements like that is what makes people from interstate have a laugh at Adelaide. Embarrassing coming from a State Minister.
I'm not really a fan of Minister Knoll but if it's the last part of the quote you're talking about then that's completely subjective and I think there are many people (including countless sporting commentators and journalists) who would class the Oval among the best sporting grounds in the country/world. But let's not get into this argument again...
Can't have a State Minister making a statement that says 'the best' - see the word 'the' - he didn't make a subjective statement - he made an actual statement, one that is incorrect. He needed to stick to the positives of having a unique situation with a hotel attached to a major sporting stadium which is a differentiator to other stadiums that should attract international attention - and leave the statement at that.

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[APP] Re: Adelaide Oval Hotel

#494 Post by ChillyPhilly » Fri Oct 11, 2019 3:26 pm

It's called the halo effect.
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[APP] Re: Adelaide Oval Hotel

#495 Post by Llessur2002 » Fri Oct 11, 2019 3:46 pm

Bob wrote:
Fri Oct 11, 2019 2:51 pm
Llessur2002 wrote:
Fri Oct 11, 2019 2:06 pm
Bob wrote:
Fri Oct 11, 2019 1:28 pm
Major construction starts on Adelaide Oval Hotel

https://indaily.com.au/news/local/2019/ ... val-hotel/

One paragraph in particular which quoted Minister Knoll happened to catch my eye...

“It’s also going to return money to taxpayers in the form of dividends and it’s going to keep our world-class Adelaide Oval the best in the country, if not the best in the world.

Silly statements like that is what makes people from interstate have a laugh at Adelaide. Embarrassing coming from a State Minister.
I'm not really a fan of Minister Knoll but if it's the last part of the quote you're talking about then that's completely subjective and I think there are many people (including countless sporting commentators and journalists) who would class the Oval among the best sporting grounds in the country/world. But let's not get into this argument again...
Can't have a State Minister making a statement that says 'the best' - see the word 'the' - he didn't make a subjective statement - he made an actual statement, one that is incorrect. He needed to stick to the positives of having a unique situation with a hotel attached to a major sporting stadium which is a differentiator to other stadiums that should attract international attention - and leave the statement at that.
I think most people would be absolutely fine with an official representative of a state or country making the occasional statement referring to it or one of its major assets as 'the best' and wouldn't be offended or embarrassed by it.

I personally think that the best Shiraz in the world comes out of the Barrossa. Again it's subjective so others would disagree but it's definitely a contender. However, I can't see anyone having a problem with the Minister for Tourism spruking it as 'the best' during a press conference about our wine regions - some might argue that it's his job to do just that. Why would it be different for the Oval?

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