Agenda Item 5.1 COUNCIL REPORT

27 March 2007 ACTIVE MELBOURNE – AFL FACILITIES REDEVELOPMENT UPDATE

Committee Docklands and Major Projects

Presenter Cr Clarke

Purpose

1. To provide an update on the status of the redevelopment projects of the Australia n Football League (‘AFL’) clubs located at North Melbourne Recreation Reserve (North ), () and Punt Road Oval () and to recommend actions specific to each project.

Consideration at Committee

2. As a result of consideration at Committee, and after debate, the Docklands and Major Projects Committee endorsed the recommendation detailed below:

2.1. That the Docklands and Major Projects Committee: 2.1.1. in relation to the North Melbourne Recreation Reserve; 2.1.1.1. restates Council’s position that its funding is dependent on the proposed facilities including an indoor basketball/netball court and gymnasium for community use; 2.1.1.2. subject to funding, these community facilities are to be included in the plans for approval and are scheduled to be constructed at the same time as the Football Club facilities; and 2.1.1.3. recommend that Council advise the North Melbourne Football Club/Australian Football League that a minimum of $3.3 million must be held in a Trust account and be available before the contract is executed. 2.1.2. in relation to the Punt Road Oval: 2.1.2.1. notes the current status of the redevelopment; and 2.1.2.2. that in order to progress to the next step of planning the project; 2.1.2.2.1. approves in principle, incorporating all the community and Council facilities in the vicinity (with the exception of the proposed community garden) into the footprint of the new facility i.e. community meeting rooms and Council depot requirements, thus maximising the area that would be returned to publicly available parkland; and 2.1.2.2.2. note the intention for the removal of the disused former caretakers cottage to achieve 2.1.2.2.1 subject to the required statutory process and subject to the finalisation of the funding for the redevelopment from all parties of the Agreement; and 2.1.2.2.3. requests that the consideration of the relocation of the turf wickets not impact on the parkland. 2.1.3. in relation to Princes Park: 2.1.3.1. notes the current status of the redevelopment; and 2.1.4. requests a further update on the three projects at the next meeting of the Docklands and Major Projects Committee meeting.

3. The Committee approved the recommendation with the exception of paragraph 2.1.1.3 under delegation and, as such, only paragraph 2.1.1.3 is required to be submitted to Council for its consideration as detailed below.

Recommendation

4. That Council advise the North Melbourne Football Club/Australian Football League that a minimum of $3.3 million must be held in a Trust account and be available before the contract is executed.

Council Report Attachment: 1. Docklands and Major Projects Committee, Agenda Item 5.3, 6 March 2007 Page 1 of 12

DOCKLANDS AND MAJOR PROJECTS Agenda Item 5.3 COMMITTEE REPORT

6 March 2007 ACTIVE MELBOURNE – AFL FACILITIES REDEVELOPMENT UPDATE

Division City Design

Presenter Ian Harris, Group Manager Parks & Recreation

Purpose

1. To provide an update on the status of the redevelopment projects of the Australian Football League (‘AFL’) clubs located at North Melbourne Recreation Reserve (North Melbourne Football Club), Princes Park (Carlton Football Club) and Punt Road Oval (Richmond Football Club) and to recommend actions specific to each project.

Recommendation from Management

2. That the Docklands and Major Projects Committee: 2.1. in relation to the North Melbourne Recreation Reserve; 2.1.1. notes the progress on developing a design for the new community/football facility; 2.1.2. notes the concept of obtaining additional funding from another party to fund the gymnasium component of the facility with tenure of sufficient length to the operator to allow return on the capital investment – subject to community access as specified by Council; and 2.1.3. notes the current progress on the development of a new lease to the North Melbourne Football Club; 2.2. in relation to the Punt Road Oval: 2.2.1. notes the current status of the redevelopment; and 2.2.2. that in order to progress to the next step of planning the project; 2.2.2.1. approves in principle incorporating all the community and Council facilities in the vicinity (with the exception of the proposed community garden) into the footprint of the new facility i.e. community meeting rooms and Council depot requirements, thus maximising the area that would be returned to publicly available parkland; and 2.2.2.2. approves the removal of the disused former caretakers cottage to achieve 2.2.2.1; 2.3. in relation to Princes Park: 2.3.1. notes the current status of the redevelopment; and 2.4. requests a further update on the three projects at the next meeting of the Docklands and Major Projects Committee meeting

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Key Issues

3. The Docklands and Major Projects Committee at its 5 December 2006 meeting, in relation to the North Melbourne Recreation Reserve, resolved to:

3.1. note the draft landscape plan for the North Melbourne recreation Reserve; 3.2. note the Project Management Plan and draft Schematic Design Brief – Functional and Technical – North Melbourne Recreation Reserve Building Redevelopment; 3.3. reaffirm Council’s commitment of not more than $2 million capital funds towards the facility redevelopment, with any additional funds if required, being provided by the other funding partners, or from other sources; 3.4. request a further report on proposed provisions for the new facility lease be provided at the next meeting of the Docklands and Major Projects Committee; and 3.5. note that this decision is being made by the Committee under delegation from the Council and is subject to the referral notice process.

North Melbourne Recreation Reserve Issues

Grandstand

4. A contract for the demolition of the grandstand has been awarded. Works commenced on 28 February 2007 and be completed within 10 weeks.

Facility Design

5. The original submission by the North Melbourne Football Club to the AFL based on a floor area of 2605m2 was estimated at approximately $7 million including fit out. After considerable investigation and consideration of several options by the project team, a design option costed at $7 million has been prepared and is now being considered by the funding partners.

Key features included in the design:

5.1. Football Club facilities including training facilities, administrative office space, football club shop and storage space.

5.2. Gymnasium of 300m² which would be shared by the Club and the community. However as this gym is considered too small both for Club and community use, alternative source of funds could be explored (in addition to the $7 million) to provide a more suitably sized gym (see below).

5.3. Community space comprising community change rooms for users of the oval and meeting rooms.

5.4. Shared Club and community space including meeting rooms, a theatrette and circulation space.

5.5. An unroofed basketball/netball court with the potential to be roofed in the future.

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6. Although a gym of 300m² is incorporated in the design option being considered, all funding parties consider that this sized gym would not adequately meet the requirements of the Club or the community. Therefore the option of sourcing additional capital funding, either through the Football Club/AFL or another body such as a commercial fitness provider is being investigated which would allow the construction and fit out of an appropriate size gym. However the funding body would require tenure, such as sublease from the Club, for a sufficient period to allow return on the capital invested. The preliminary cost estimates of a financially viable gym in the order of 500m² would cost $0.8 to $1 million for construction and fit out.

Development of the Lease

7. Negotiations have progressed with the North Melbourne Football Club and the Department of Sustainability and Environment representing the Minister for Crown Lands – Minister for Planning on the new lease provisions. Council has also completed an initial assessment of the lease valuation. A number of key lease considerations have been agreed in principle between Council and the football club, including permitted use, lease areas, lease term, and lease commencement (upon occupation of facility. A number of other key considerations that will inform the development of the lease are awaiting finalisation of agreed project scope, design, and any third party funding contributions including: lease rental, facility maintenance, management arrangements, signage and naming rights and community access consistent with the Council resolution of October 2006.

8. Significant progress has been made on the key issue of signage and naming rights, with Council and the football club working closely to ensure an appropriate outcome for both parties. These outcomes will be incorporated into the lease.

Punt Road Oval Update

Project Overview

9. All funding parties have recently agreed that project governance model for the Richmond Football Club facilities redevelopment should be the same as that for North Melbourne i.e. Council chair the Project Control Group (‘PCG’), an independent project manager be appointed and the project be undertaken through Council’s processes. Action is now underway to establish the PCG.

Planning Issues

10. In order to achieve an integrated facility, achieve the maximum community benefit for Council’s contribution ($2 million) and maximise the return of parkland to publicly available space, the following planning principles are proposed:-

10.1. that the footprint of the combined facilities be kept to a minimum, and therefore be significantly less than the total area currently occupied by all the current facilities;

10.2. that all football club, community and Council facilities (with the exception of the proposed community garden) be integrated into a single development; and

10.3. that all redundant buildings and structures (including the degraded former caretaker’s house be removed. (See attachment 1). Note the demolition of the house is not supported by the East Melbourne Group (see consultation section) but a decision in principle would allow further planning of the overall facility to proceed with certainty.

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Princes Park Update

11. All funding parties have recently agreed that the project governance model adopted for North Melbourne and Richmond should also be adopted by Carlton i.e. Council chair the Project Control Group, the project be managed by an independent project manager engaged by Council and tendering be undertaken through Council processes. Action is now underway to establish the Project Control Group.

12. In January 2007 a group seeking election to the Carlton Football Club Board announced a proposal for major redevelopment project at Princes Park, building on the proposed redevelopment project already being planned by the State Government, AFL, Council and football club. Council had no input into or knowledge of this development plan, and since the group was not elected it is understood this proposal is not progressing.

Relation to Council Policy

13. City Plan Strategic Objective 3 – Inclusive and Engaging City of Melbourne:

13.1. “Deliver and provide access to facilities and services to support city residents, visitors and workers.

13.2. Plan for the changing needs of residents, local and international students, visitors, workers and businesses in the city.

13.3. Improve community health and wellbeing by increasing participation in sporting leisure and recreation activities and implementing the City Health and Active Melbourne Strategy.

13.4. Contribute to the development of sporting and recreational facilities and investigate the feasibility of communal facilities in Docklands in accordance with Council’s ‘Partnership Funding Principles for new sports facilities in parklands’.

13.5. Promote, celebrate and further develop the City of Melbourne as a culturally rich capital city that encompasses its key strengths in art and sport.

13.6. Promote and further develop Melbourne as a sporting capital by delivering the Active Melbourne and National and International Sports Marketing Policy programs.

14. The Draft Active Melbourne Strategy is:

“part of Council’s response to the issues and challenges of increasingly sedentary lifestyles within modern communities, with the aim of enhancing the health and well being of our community. This strategy will strive to provide opportunities for as many people as possible to participate in physical activities to contribute positively to their health and well being”.

15. Under the theme of “Place”, the Draft Active Melbourne Strategy advocates that Council:

“will work cooperatively with the private and voluntary sectors to ensure that these are safe, appropriately equipped and maintained places for the community to access a range of activity opportunities” and that “the availability of purpose built facilities, eg. community recreation centres or the general infrastructure people use in daily life eg. parks and open space is a crucial factor in enabling activity”.

16. The partnership Funding Principles for New Sports Facilities in Parkland was approved by Council in 2001 and resolved that it:

16.1. “approve partnership funding principles for new or refurbished facilities located in parkland based upon council contributing the cost of the community benefit component of the

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facilities, and the sporting organisation contributing the cost of the component that would benefit the sporting organisation;

16.2. require that each specific proposal require community consultation and be subject to separate Council approval; and note that any proposal involving new or modified structures would be subject to the statutory planning process and be subject to the community feedback as required as part of the statutory planning process.”

Consultation

17. Council has undertaken an assessment of general recreation needs within the local areas of North Melbourne, Carlton and East Melbourne. This assessment has been of a general nature relating to the recreational needs within each local area but also determined the likely community demand that could be met by the redeveloped facilities. The draft schematic designs for all redevelopments will incorporate the community requirements as indicated by the recreation needs study.

18. Comprehensive discussions on the proposals have been held with the AFL, football clubs, Department of Sustainability and Environment (representing the Minister responsible for Crown land) and Sport and Recreation Victoria.

19. Following completion of the schematic design for each project, extensive community and stakeholder consultation will be undertaken. Further community input will then be invited during consideration of the planning permit application for each project.

20. Discussions have been held with the East Melbourne Group (EMG) on the proposal to demolish the degraded, disused caretaker’s house near the Punt Road Oval in . The Association’s stated position is as follows:

20.1. The original plan to renovate the house and construct a community garden within the surrounds of the house was proposed in 2004 and should proceed;

20.2. In accordance with EMG policy on historic buildings, the gardener’s cottage built in 1914 is of social and heritage significance and very much part of the history of Yarra Park. It therefore ought not be demolished, but instead restored and maintained by the parks manager, the City of Melbourne; and

20.3. The suggestion that community space could be found in the Richmond Football Clubs premises is not an option.

Finance

21. Council has resolved to contribute no more than $2 million to the redevelopment of facilities at the North Melbourne Recreation Reserve, Punt Road Oval and Princes Park.

Legal

22. The matters detailed within the report are within the functions and powers of Council under the Local Government Act 1989. Legal advice will be provided as required in relation to the various proposals.

Sustainability

23. It is anticipated that the redevelopment at each site will result in return of some parkland as community open space. The redevelopments will be designed to greatly improve the aesthetic presentation of the buildings and provide the opportunity to enhance the overall appearance of the park settings. The objective is that the community will have greater access to sporting and recreational facilities thus supporting Council’s Active Melbourne program.

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Background

24. Council resolved in December 2005 to, in part:

“Support the redevelopment of the recreational and sporting facilities located on land managed by the City of Melbourne at North Melbourne, Richmond and Carlton which are currently used by three Australian Football League and various clubs and note that the provision of financial support will be managed through Council’s annual budget processes;”

25. The Council resolved in October 200656 meeting, in relation to the AFL facilities redevelopment resolved to:

25.1. in relation to the North Melbourne Recreation Reserve: 25.1.1. resolve that the existing grandstand be demolished in order to achieve full open space and community benefits of the re-landscaping of the reserve; 25.1.2. note that under delegation tenders will be invited and awarded for the demolition of the grandstand; 25.1.3. note the progress of the redevelopment of the North Melbourne Football Club facility including the development of a draft project brief incorporating requirements for key community benefits; 25.1.4. approve Option 2 as the site location of the facility redevelopment as proposed in Attachment 1 of this report; 25.1.5. to further define the concept brief including areas and cost back to the next Docklands and Major Projects Committee; and 25.1.6. consider the inclusion of key lease principles to be applied to the redevelopment as part of lease negotiations between all parties: 25.1.6.1. community use areas (eg gym, stadium); 25.1.6.1.1.1.1. club use to be programmed and agreed on regular basis (eg annually); 25.1.6.1.1.1.2. community access no less than 80 per cent of available hours; 25.1.6.1.1.1.3. available consistent with comparative facilities (eg 9.00am to 10.00pm, 7 days per week); and 25.1.6.1.1.1.4. costs/charging consistent with similar Council facilities; 25.1.6.2. shared use areas (eg meeting rooms, reception); 25.1.6.2.1.1.1. club use to be programmed and agreed on regular basis (eg annually); 25.1.6.2.1.1.2. community access less than 50 per cent of usable hours; 25.1.6.2.1.1.3. available consistent with comparative facilities; and 25.1.6.2.1.1.4. costs/charging consistent with similar Council facilities; 25.1.6.3. club use area (eg administration offices, players change rooms); 25.1.6.3.1.1.1. community access to be minimal; and 25.1.6.3.1.1.2. limited opportunity for community usage 25.2. in relation to the Punt Road Oval: 25.2.1. note the development of a preliminary concept brief and an initial concept plan for the redeveloped Richmond Football Club facility incorporating; 25.2.1.1. requirements for key community benefits;

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25.2.1.2. options for including Council’s Yarra Park depot within the redeveloped facility; 25.2.2. consider the inclusion of key lease principles to be applied to the redevelopment as part of lease negotiations between all parties: 25.2.2.1. community use areas (eg gym, stadium); 25.2.2.2. club use to be programmed and agreed on regular basis (eg annually); 25.2.2.3. community access no less than 80 per cent of available hours; 25.2.2.4. available consistent with comparative facilities (eg 9.00am to 10.00pm, 7 days per week); and 25.2.2.5. costs/charging consistent with similar Council facilities; 25.2.2.5.1. shared use areas (eg meeting rooms, reception); 25.2.2.5.1.1. club use to be programmed and agreed on regular basis (eg annually); 25.2.2.5.1.2. community access less than 50 per cent of usable hours; 25.2.2.5.1.3. available consistent with comparative facilities; and 25.2.2.5.1.4. costs/charging consistent with similar Council facilities; 25.2.2.5.2. club use area (eg administration offices, players change rooms); 25.2.2.5.2.1. community access to be minimal; and 25.2.2.5.2.2. limited opportunity for community usage; 25.3. in relation to Princes Park: 25.3.1. note the development of a draft concept brief and an initial concept plan for the Carlton Football Club facility, incorporating; 25.3.1.1. requirements for key community benefits; 25.3.1.2. options for including Council’s Princes Park depot within the redeveloped facility; and 25.3.2. consider the inclusion of key lease principles to be applied to the redevelopment as part of lease negotiations between all parties: 25.3.2.1. community use areas (eg gym, stadium); 25.3.2.1.1.1.1. club use to be programmed and agreed on regular basis (eg annually); 25.3.2.1.1.1.2. community access no less than 80 per cent of available hours; 25.3.2.1.1.1.3. available consistent with comparative facilities (eg 9.00am to 10.00pm, 7 days per week); and 25.3.2.1.1.1.4. costs/charging consistent with similar Council facilities; 25.3.2.2. shared use areas (eg meeting rooms, reception); 25.3.2.2.1.1.1. club use to be programmed and agreed on regular basis (eg annually); 25.3.2.2.1.1.2. community access less than 50 per cent of usable hours; 25.3.2.2.1.1.3. available consistent with comparative facilities; and 25.3.2.2.1.1.4. costs/charging consistent with similar Council facilities; 25.3.2.3. club use area (eg administration offices, players change rooms);

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25.3.2.3.1.1.1. community access to be minimal; and 25.3.2.3.1.1.2. limited opportunity for community usage; 25.4. indicates its intention to contribute not more than $ 2 million capital funds for the facility at the Punt Road Oval and not more than $2 million capital funds for the facility at Princes Park (similar to the existing commitment to the North Melbourne facility) subject to: 25.4.1. community benefits at each facility being achieved to the satisfaction of Council; 25.4.2. the design of each facility achieving a significantly improved presentation within the respective park setting; 25.4.3. any capital funding contribution being determined through and subject to Council’s annual budget process; 25.4.4. the AFL/individual AFL Clubs and State Government each contributing no less than any amount that may be provided by Council, noting that any allocation by Council may be conditional on such contributions; and 25.4.5. noting that the anticipated overall requirements on Council’s capital budget program (subject to approval) is anticipated to be in the order of: 25.4.5.1. financial year 2006/2007 - $0.7 million (including carry forward of $0.150 million from 2005/2006) which is already allocated in 2006/2007; 25.4.5.2. financial year 2007/2008 - $3.3 million; and 25.4.5.3. financial year 2008/2009 - $2 million.

26. Melbourne is renowned for being the sporting capital of Australia. A major part of this reputation and image is generated by the Australian Football League (‘AFL’). The City of Melbourne has a significant part to play in this area and maintenance of the facilities is part of its responsibility. The City of Melbourne has some responsibility for the buildings and facilities on these parcels of land and the condition of some of these buildings is such that urgent refurbishment work is required.

27. The AFL and State Government have developed a Victorian AFL Club Facilities Funding Program to assist Victorian AFL clubs to develop their training and administrative facilities. The program proposes a four (4) way funding arrangement involving the AFL, State Government, local government and individual clubs. The City of Melbourne currently has five (5) AFL clubs located within the municipality (Carlton, Richmond, North Melbourne, Collingwood and Melbourne).

28. The AFL has indicated that it is strategically important for each of its member clubs to have access to the best possible training and administrative facilities. Council officers have consequently worked with the AFL and the State Government to support the achievement of this outcome and to also ensure that there is an increased community benefit as part of any redevelopment.

North Melbourne Recreation Reserve Redevelopment

29. The original submission by the North Melbourne Football Club to the AFL in November 2005 was based on a floor plan of 2,605 m2. The estimated construction cost to fit out was costed at approximately $7 million. This included a 300 m2 gymnasium area for club and community use, a 640 m2 stadium, and 45 m2 circulation space.

30. All funding partners agreed to Council managing the overall project including chairing the project control group and appointing an independent project manager and architect.

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31. Following the appointment of the project manager, architect and other sub consultants in June 2006, the project has been informed by the development of a Project Management Plan and Technical and Functional Brief. These have been agreed by the Project Control Group funding partners, and have further defined the scope of the project and reviewed in detail the spatial requirements of the project through an extensive area analysis schedule. Several design options which meet all the funding partners’ requirements have been considered by the project team but these exceeded the agreed $7 million budget.

32. As none of the funding partners are able to commit any extra funding beyond that already agreed and articulated in the Project Management Plan, a revised concept plan option has currently been produced that meets the $7 million budget and is currently being considered by the funding partners.

33. As the gymnasium component in this plan does not meet the requirement of any of the funding partners, additional funding (above the $7 million) for gym construction and fit out is desirable.

Punt Road Oval Redevelopment

34. The removal of the disused house and Council facilities adjacent to the Punt Road oval, and incorporation of all Council and communities facilities, including meeting areas, into the new facility would lead to significant return of parkland for public use and maximise Council’s return on its investment in the project.

35. The condition of the disused weatherboard former caretaker’s house is very poor, requiring major structural work to restore it to habitable condition, including re-stumping, re-roofing, re-wiring, re- plumbing and re-plastering, at a cost estimated at $140,000 - $190,000. Additional funds estimated at $100,000 would also be required to modify it for alternative uses and enable it to comply with OH&S and disability access requirements.

36. The heritage significance of the house has been assessed as ‘of local significance and a contributory element within the Yarra Park precinct’ (Yarra Park Conservation Analysis prepared by John Patrick Pty Ltd in association with Bryce Raworth Pty Ltd, October 2001).

37. Although the East Melbourne Residents Association requests the retention and renovation of the house for community activities, these could be provided in line with Council’s $2million contribution to the new redeveloped football club facility. Also Council has already provided a dedicated building for the Association in Powlett Reserve, and other meeting facilities are available at the East Melbourne Library.

Attachment: 9 1. Yarra Park Depot and House Complex Page 10 of 12 Attachment 1 Agenda Item 5.3 Docklands and Major Projects Committee 6 March 2007

Page 11 of 12 Agenda Item 5.3 Docklands and Major Projects Committee 6 March 2007 FINANCE ATTACHMENT

ACTIVE MELBOURNE – AFL FACILITIES REDEVELOPMENT UPDATE

Funding of $6.050 million (gross) has been included in the 2006/07 budget for the North Melbourne Football Club redevelopment.

External contributions by the AFL, State Government and North Melbourne Football Club will be $5.50million.

Council’s direct contribution in 2006/07 will be $1.027 million (including $0.477 million carry forward from 2005/06). The sum of $0.327 million will be set aside from the carry forward for the demolition of the grandstand.

A further bid of $1.3 million will be included in the 2007/08 budget process for the North Melbourne Recreation Facility Redevelopment and be subject to the normal budget processes.

Funding for the Carlton & Richmond Recreation facilities and any further funding requirements will be subject to normal budget processes.

Removal of the disused former caretakers cottage will need to be funded from Council’s operating budget and will be subject to the normal budget processes.

Kerrie Jordan Acting Manager Financial Services

Page 12 of 12 Agenda Item 5.3 Docklands and Major Projects Committee 6 March 2007

LEGAL ATTACHMENT

ACTIVE MELBOURNE – AFL FACILITIES REDEVELOPMENT UPDATE

The matters detailed in this report are within the functions and powers of the Council under the Local Government Act 1989 (“the Act”). Legal advice will be provided as required in relation to the various proposals.

Section 3C(1) of the Act provides that:

“The primary objective of a Council is to endeavour to achieve the best outcomes for the local community having regard to the long term and cumulative effects of decisions.”

Section 3C(2) of the Act provides that in seeking to achieve its primary objective the Council must have regard to facilitating objectives including:

“(c) to improve the overall quality of life of people in the local community;

(e) to ensure that services and facilities provided by the Council are accessible and equitable;”

Section 3E(1) of the Act provides that the functions of a Council include:

“(a) advocating and promoting proposals which are in the best interests of the local community;

(b) planning for and providing services and facilities for the local community;

(c) providing and maintaining community infrastructure in the municipal district;”

Kim Wood Manager Legal Services