194 Pitt Street Hoax: 5 – Heritage Issues

You can’t talk about 194 Pitt Street without talking about the heritage issues with the building.

The building has serious heritage limitations that meant any work was going to be very difficult and very expensive.

Even using it as a part of a property development (the only reason it was bought) was problematic, something the Committee now fully realise.

The facade had heritage status, and most people knew that. But what very few knew was that the interior was also a heritage issue, with serious implications for any renovation.

One of the many problems with the building was that the 8 floors don’t match up with the floors of 196 next door. But any attempt to deal with this was hampered by the heritage issues.

Which is partly why, 9 years on, nothing has been done.

Naturally, members were deceived all the way about the heritage implications.

The Explanatory Memorandum said:

The club carried out the due diligence listed below which have all proved satisfactory”

One of the below listed items was:

  • Heritage status of the building

 

Satisfactory?

What do you think?

City Tatts Information Desk


194 Pitt Street Hoax: 4 – NAB loan ban

It’s not really a surprise that the promised benefits from 194 Pitt Street never materialised.

The extensive work required to make the building usable was never going to happen.

And Guilfoyle and the Committee knew it was never going to happen.

This is the part of the 194 Pitt Street fraud that is not widely known.

Why was it never going to happen?

Because after buying it, the Club had no money to pay for the work.

But NAB also told them they would not lend any money to do the work.

Yes, NAB told Guilfoyle and the Committee that they would not lend any money to do the necessary work.

So there was no money, and therefore no chance of the extensive building work ever happening.

This did not matter in the slightest to Tony Guilfoyle, because his only reason for buying it was for a future property development.

But it did mean that the promises to members about 194 were a sham.

City Tatts Information Desk

 


194 Pitt Street Hoax: 3 – The Back-up Plan?

When Tony Guilfoyle and the Committee pitched the purchase of 194 Pitt Street to members, they said they had “a very good exit strategy” if the Club faced financial difficulties due to the purchase.

They could “lease the building as a separate concern (net income $477,190 per annum)” or “worst case scenario would be to sell the building”.

The Club faced continual financial difficulties from the day it was purchased, so how did the exit strategy work out?

Not very well.

They never rented out the building, and they never sold it.

The promise of renting the building was just another Guilfoyle lie. It was never going to happen. Even in 2007 everyone in the property game laughed at this. Nobody could recall the top four floors ever being rented out. You only have to take one look at the building to see that no one would rent it.

And that’s before you consider the money that would have to be spent on it to make it acceptable to any tenant (or the council).

As for selling it, who exactly would want to buy it?

Even 9 years on they’d be lucky to get their $9 million back, never mind the holding costs since 2007 which are another $7 million, at least.

City Tatts Information Desk


194 Pitt Street Hoax: 2 – The cost to the Club

194 Pitt Street has been a millstone for City Tatts since 2007

It has been the biggest single drain on the Club’s finances since then.

Back in 2007 City Tatts owed about $10 million to the bank, which it could comfortably repay over time.

194 Pitt Street cost $9,250,000, plus $500,000 in stamp duty, and the Committee borrowed the entire amount. The annual interest bill was $740,000 and with other building expenses the total holding cost was $800,000 every year.

But because the building never produced any additional income, the $800,000 had to come out of existing earnings. So not only were they unable to repay any of the $10 million borrowed for 194, they could no longer repay the existing bank loans – because the entire profits of the Club were now going in interest.

Without 194 the existing bank loans would be repaid by now.

And that only begins to describe the disaster.

The building itself had serious problems that were bound to be very expensive to fix. Heritage and fire requirements were just some of the major issues. The fact that 7 out of the 8 floors are still idle after 9 years is the best indication of the work required.

Most of this was concealed from members, and the portion that was mentioned was downplayed.

City Tatts Information Desk


194 Pitt Street Hoax: 1 – What it would do for members

When the Committee decided to buy 194 Pitt Street, they needed members approval.

Their main pitch was what the building would do for members.

Basically, none of the promised benefits have materialised.

The cafe and restaurant never happened. In fact, they got a very swift rejection from Sydney City Council.

The new admin offices never happened.

And the terrace for smokers was later duplicated at the Silks street frontage, proving that it could have been there all along.

The only part of the building ever to be used, the ground floor, only highlighted how dishonest the Committee had been. The poker machines installed in 194 were just moved down from the Masquerade area. This farce was later exposed by Tony Guilfoyle himself when he started selling poker machines. That showed that Silks could easily house all the poker machines that were needed.

It’s simple.

The only reason Guilfoyle wanted to buy 194 Pitt Street was for the property development he always dreamed of.

City Tatts Information Desk


Why is the City Tatts Auditor’s Report addressed to the Committee?

The Auditor’s Report on the City Tatts accounts is now addressed to the committee.

But until 2013 it was always addressed to the members.

Cameron Roan from KPMG was the auditor before and after this change.

And the Auditor’s Report for every other club is addressed to the members.

Can anyone explain why City Tatts is different?

City Tatts Information Desk


Still no word on what Marcelo Veloz did after Dooleys

There are many mysteries about City Tatts.

But the latest mystery might be the biggest of the lot.

Once it became known that Marcelo Veloz left Dooleys in “unusual” circumstances, the obvious question was: Where did he go next?

In other words, what did he do in the period between leaving Dooleys and re-surfacing at Cronulla Leagues Club, a year later?

But despite much searching, no one has yet been able to provide an answer.

City Tatts Information Desk