Retirement living company Aveo says it won’t bail out Shortland Waters Golf Club after the club entered voluntary administration.
The Newcastle Herald reported on Tuesday that the club was seeking an amalgamation partner after two years of building work at the course had left it with a cash-flow crisis. Several other Newcastle golf clubs, including Belmont, are crunching the numbers on taking over the former Steelworks layout, but the course’s future is by no means guaranteed.
Treasurer Kerry Duggan this week raised the prospect of the club, which has 534 members, being sold off to developers if it was not financially viable.
Aveo, which is building a 300-lot, $220 million retirement village in the middle of the course, said on Friday that it would “not be a candidate to take over the management of the Shortland Waters golf course”.
The company is also building new holes and a new clubhouse at the course in a deal which rescued the club from financial difficulty two years ago.
“Aveo has previously provided $8.5 million in financial support to complete the Shortland Waters golf clubhouse and new course holes,” a spokesperson said.
“We welcome the interest shown by several other Newcastle golf clubs in potentially taking over the management of the Shortland Waters golf course.”
Mr Duggan said golfers were avoiding the course during the construction work, but he said the club likely would have folded if not for the Aveo deal.
“Aveo recognises that the decision by Shortland Waters golf course to enter voluntary administration reflects a wider decline of the golf course industry,” the Aveo spokesperson said.
“Aveo also recognises that decisions about the future of the Shortland Waters golf course are now decisions for the appointed administrator.”
Merewether, one of many golf clubs in the Hunter looking at redevelopment joint ventures to prop up declining revenue, will hold a member vote next month on a seniors-living project.
Belmont Golf Club took over the struggling Belmont Bowling Club late last year after the bowling club sold its premises for $4.8 million.
Cessnock Golf Club has been trying to find another club to merge with since going into voluntary administration in April with debts of about $11 million.
In 2005, the club signed a joint venture with Newcastle construction company Daracon Group for a course redesign and housing estate known as Stonebridge Living.
The club owes more than $10 million to secured creditor David Mingay, the managing director and founder of Daracon Group.
Creditors agreed at a meeting on July 24 to enter into a deed of company arrangement with the golf club to give it more time to negotiate with potential partners.