The facility has recorded a $1.2 million loss since opening in 2022, according to a review by KPMG. Photo: Eurobodalla Shire Council.
A multi-million facility in Batemans Bay has clocked in a $1.2 million loss since it opened less than a year ago.
A review carried out by KPMG has examined the financial performance of the Bay Pavilions precinct since it opened in June 2022 to 31 March 2023.
It found the precinct lost $1.2 million against the baseline financial model’s forecast loss of $563,000.
Mayor Mathew Hatcher said the precinct had been a long-term project.
“This project started in 2016 under a previous general manager and a previous mayor and a previous council.
“It was supposed to be delivered at least a year earlier than it came,” he said.
The precinct had a total construction cost of $63.5 million and is composed of two attractions – the Arts Pavilion and the Aquatic Pavilion – and includes a theatre, gallery, two pools, a gym and a bar, among other facilities.
It is operated by a third party called Aligned Leisure, a subsidiary company of the AFL’s Richmond Football Club.
The review was ordered by Eurobodalla Shire Council (ESC) general manager Warwick Winn earlier this year.
According to the review, total revenue for Bay Pavilions precinct in the nine month-period was found to have been $2,692,238, or an 8 per cent difference to expectations.
The review found that Bay Pavilions also had an operating loss of $6.10 per visit, or more than double the $2.45 predicted in the baseline financial model.
Total patronage was found to have been 12 per cent lower than expected.
Mayor Hatcher said some facilities at the Bay Pavilions precinct had proven more popular with the community than others, however.
“The learn to swim aspect of the pool is being heavily used, but other parts of the facility like the arts and the performing arts space are being heavily underutilised,” he said.
“We’ve got to work with the management of the facility to make sure that we’re getting everything we can out of it.”
Operating expenses also came in 13 per cent higher than what was forecast.
Mayor Hatcher said ESC would review the report when it was formally presented to them at their upcoming meeting on Tuesday (15 August).
“Everything is based around a projection of a business case,” he said.
“The performance of it was always kind of a guess, but you’re only working with figures that are based on information from other facilities of the like.”
“Notwithstanding that, clearly the business case was wrong and clearly it’s not performing the way the previous council thought that it would,” he said.
The review also found that financial models indicate Bay Pavilions will have operating and total losses across the next 10 years.
KPMG reviewed around 200 documents and carried out interviews as part of the review, and Mayor Hatcher praised the council’s transparency throughout the process.
“There’s not a conspiracy in the background of [Council] asking a consultant to give us the type of report that we want,” he said.
“We’ve even released the documents that we sent to them, so everyone can see everything.”
“That’s what I want the community to take away from this,” Mayor Hatcher said.
The full Bay Pavilions Financial Performance Review report is available on the council’s website and will be formally presented to ESC at its meeting on 15 August.
Loading ...
