AFL club plans to move away from pokies with sale of pub
Aussie Rules team, the Melbourne Demons, are the latest to move away from gaming revenue as it has announced it will sell a lucrative poker machine venue it owns.
The Age reports that Melbourne Football Club will see the Bentleigh Club in a move that will net the club more than $20 million.
The club plans to invest the funds from the sale of the pub into a future fund, which is planned to generate revenues to offset the annual gaming revenues lost from gambling.
The move comes after the Western Bulldogs, Collingwood and Geelong had all divested their stakes in poker machine venues in recent years and North Melbourne was the first club to walk away from poker machine revenue.
Five Victorian clubs, Carlton, Essendon, Richmond, Hawthorn and St Kilda, were all awarded new 20-year licenses in 2018 to operate machines.
Essendon at the time said the longer-term plan was to move away from gaming, while St Kilda has said they want to reduce their reliance on gaming revenue once they find alternative revenue streams.
Richmond president Peggy O’Neal said in 2020 that after litigation regarding the lease of the Wantirna Club had been completed, the club was “in a position to consider the club’s long-term position with respect to gaming”.
Hawthorn president Jeff Kennett has been defiant that the club was involved in legal venues that delivered significant income and they would remain involved in gaming until an alternative revenue source was available, but that would not happen in the short or medium term.
Melbourne Demons not dependent on pokies for revenue
Melbourne CEO Gary Pert said the Demons had now reached a point where they could sell the Bentleigh Club and turn those funds into an ongoing revenue stream.
“Financially, we are in the strongest position we have ever been in our long history as a club and this is a crucial step in solidifying this financial security, without the need for support from gaming related venues,” Pert said.
“The decisions to sell the Leighoak in 2018 and now the Bentleigh Club have been based on securing the best long-term financial outcomes for the club, but it is also pleasing that this has completely removed the club’s reliance on gaming related income.”
No sale will be finalised and settled before at least August 2022, due to prior contractual and licensing commitments.
Melbourne earned more than $10 million from the Leighoak sale, which enabled it to retire the last of its debt and have the funds available to withstand the $3 million hit the club took from COVID_19, without having to ask for special assistance from the AFL.
Pert said all AFL clubs got into poker machine venues initially to try to find revenue sources that were not reliant to the cycles and fluctuations of on-field performance.
“When we get this money, and it will be more than $20 million, and we invest that money in a future fund, a primary element of this will be to replace gaming revenue.”
When it owned the Leighoak and the Bentleigh Club, Melbourne was earning about $500,000 a year in gaming.
Geelong Cats end long association with pokies
Last November, The Geelong Football Club ended its long association with pokies venues by selling its Point Cook pokies venue.
The Cats announced the completion of the protracted sale of The Brook Point Cook to the Melbourne Racing Club.
The sale was originally expected to settle in early 2020 for a seven-figure sum, but was delayed because the venue had to shut its doors during the coronavirus pandemic, Cats chief Brian Cook said.
Less than a decade ago, the club pocketed $4 million per year from gambling.
It had 180 pokie machines across two venues and benefited from gambling sponsorship at its home ground.
Monday’s sale means it has now gone cold turkey, no longer making any money from those venues.
“This is a proud day for our club,” Mr Cook said.
“If you look at our mission, it’s quite obvious gaming doesn’t fit, and if you look at our values, it doesn’t fit in there either.
“We have a value of being commercial and considered. You need to consider the effect of gaming on all people, not only those who enjoy it and find it as a pastime but also those who get into it in an unhealthy way.
“That, in the end, was the crunch for us; we didn’t necessarily want to be involved in an activity that had detrimental outcomes to a number of people in the community.”