Maitland District Leagues Club’s run of bad luck continues with the “imminent” sale of the property falling through and an auction on Thursday failing to reach its reserve price.
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The club went into voluntary administration in March this year after its board of directors agreed to place the Bulwer Street business into the hands of Newcastle-based insolvency firm Shaw Gidley as administrators.
Fairfax Media reported at the time that the club owed in the vicinity of $2million with over $1.5million to St George Bank and more than $468,000 to unsecured creditors.
The club’s annual report (available online) for the year ended December 31, 2017, showed a loss of $488,385, compared to $239,126 in 2016. In 2015 it made a profit of $332,402 but recorded a loss in 2014 of $1,548,651.
The report revealed that over the past four years the leagues club received income from the sale of a property it owned in Weblands Street, Rutherford and the sale of poker machines to Tabcorp. It also showed its 2017 Tabcorp Gaming Services Fees were $787,894 compared to $569,234 in 2016 and $261,562 in 2015.
In April the leagues club and Club Maitland City announced a proposal to amalgamate, with both business entities to trade from Maitland City's Rutherford site. Both organisations entered into a memorandum of understanding which was agreed to "in principle" and later approved by club members and leagues club creditors. The history making agreement proposed to sell the Leagues Club's Bulwer Street property and consolidate the business with Maitland City at its Arthur Street site.
Valued at $3.3million the club properties (four in total (and 41 car parks) located along Bulwer Street were to be sold to extinguish creditors’ claims against the Leagues Club.
Maitland City will receive any remaining Leagues Club assets to support it in honouring its commitments under the memorandum.
That sale price was expected to depreciate due to soft market conditions. A sale to a private investor was said to be imminent in the middle of the year, however this fell through. The property was then listed for auction and was to go under the hammer in Newcastle on Thursday but was passed in. Fairfax Media understands negotiations now are being carried out with a potential buyer.
It is also understood that the potential sale may not cover the leagues club debts which are compounded by a five-year contract it entered into with Tabcorp in 2015.
The amalgamation was fast tracked and approved by the Independent Liquor and Gaming Authority. This was supposed to take six months but was done in 30 days in a bid to streamline the club’s transition.
Club Maitland City CEO Ian Martin said the whole process has been frustrating. “We have just had to sit back and let it run its course,” Mr Martin said.
