Cessnock Golf Club goes into voluntary administration with debts of more than $10m

MONEY MATTERS: Cessnock Golf Club is seeking expressions of interest for amalgamation after the club was placed in voluntary administration last month with debts of more than $10 million. Picture: Simone De PeakA VOLUNTARYadministrator has been calledin to take control of the financially troubled Cessnock Golf Club as it struggles under the weight of morethan $11million debt.

Cessnockis one of the oldest golf clubs in the Hunter and has operated a public-access courseoff Mount View Roadsince 1926.

In 2005, the club signed a joint venture with Newcastle civil construction company Daracon Group for a $30 million redevelopment of its land fora golf-lifestyle resortknown as Stonebridge Living.

It includeda 138-lot residential subdivision, which still has lots for sale, and an 18-hole Jack Newton golf course andnew clubhouse that opened in 2012.

The club owes more than $10 million to secured creditorDavidMingay, the managing director and founder of Daracon Group.

Administrator Simon Thorn, of PKF , was appointed last month and has advertisedseeking expressions of interest for an amalgamation to keep the registered club operating.

He said there were several “positive” lines of enquiryand expressions of interest closed later this month.

“The club has beenin a position where it is cash poor,” Mr Thorn said.

“The land development is all but complete and the club has significant assets for sale, but we are unsure at this stage if theywill satisfy the debt in full. It isvery early days though.”

There are 58 residential lotsand two commercial sitesfor sale at the club.

President Robert Hodge said theclub hadmore than 250 members, but no money to advertise its new facilities that include a cafe, function centre and soon-to-open kids’ playground.

OPEN FOR BUSINESS: Cessnock Golf Club course superintendent Merv Hayward on the job at the Jack Newton designed 18-hole course. Picture: Simone De Peak

He said despite Mr Mingay being “extremely patient”, the board had no choice but to call in anadministrator.

“We didn’t think it was the right thing to keep trading with the way things were, we believe we can get through this but we needhelp from a professional to guide us,” he said.

“The important thing for people to know is that it’s business as usual and we need community support to get through this.

“We need people to visit the club and come for a round of golf.”

MrThorn agreed, saying community support was crucial for the club’s long-term survival.

“The club entered into an agreement over the land deal and that has caused problems,” he said.

“We are trying to find a solution so the club can remain open to the public.

“This club shouldn’t fail, but we really need every and anyone to go out and have a round of golf because it will help to keep the club alive.”

Mr Mingay said he was hopeful the club could find a partner to amalgamatewith and keeptrading.

“They were short of money and I loaned them money, it’s as simple as that,” he said.

“I would really like to see them get through their financial situation.”

In 2015, the club was denied state regulatory approval to sign over management of its operations to Mr Mingay in an effort to settle the debt.

The Office of Liquor Gaming and Racing and the Independent Liquor and Gaming Authority vetoed the deal, finding it wasnot in the public interest and would be a conflict of interest for Mr Mingay to be both the club’s manager and mortgagee.

The registered club’s solicitor, Paul O’Sullivan, told authorities at the timethe clubowed $10.2 million to Mr Mingay, the debt could not berepaid and the clubwas at risk of financial collapse.

BEST-LAID PLANS: Course designer Jack Newton, Daracon’s John Mingay and planner Stephen Leathley discuss the Stonebridge development in 2010.

However, the authoritiesruled that the “developer (Daracon Property Pty Ltd) and the proposed manager . . . are associated entities”and the agreement would give Mr Mingay “a high level of control”over club property, its financial operations, its sale of liquor and operation of gaming machines.

Mr Hodge said Mr Mingay had been extremely supportive of the club over many years.

“There is no doubt that without the residential development the club would be going alright, we are trading as a club quite well,” he said.

“But we are where we are and we are doing the best we can to get through this. Davidcould have closed the doors years ago on us. He’s done the right thing by the club and we just want to get this sorted out in the best way possible for everyone involved.

“We believe the club can get through this.”

For more information about Cessnock Golf Club visitwww.cessnockgolfclub老域名出售or call 4990 1633.