Tasmanian Government abandons public-private partnership looking for loans to build new Hobart Stadium

The Tasmanian Government has announced that it has ruled out private sector partnerships to build the new Hobart Stadium, instead choosing a ‘design and construct’ model funded through loans.

The move comes after a market sounding process explored different delivery options for the major development at Hobart’s Macquarie Point.

Announcing the change, Tasmanian Business, Industry and Resources Minister, Eric Abetz advised “feedback from the market sounding process was crucial in understanding how to activate the precinct in a way that unlocks decades of economic investment, jobs and opportunities.

“The decision to prioritise the delivery of the multipurpose stadium through a design and construct pathway provides certainty and confidence in the future of the precinct and the Tasmania Devils AFL club.”

Construction will be funded through debt raised by the Macquarie Point Development Corporation (MPDC), on top of the $630 million already committed by the Federal and Tasmanian Governments and the AFL.

While several infrastructure funders had expressed strong interest in a public-private partnership model, the Tasmanian Government determined this approach would ultimately disadvantage the state.

Acknowledging this, Minister Abetz explained that such an approach “would cost the taxpayer more, take longer to implement and take away from the asset being owned by and for the Tasmanian people.

“We cannot afford any delays if we are to meet existing timeframes set out in the AFL agreement. Without a stadium, there is no Tasmanian AFL team.”

The new venue, last officially estimated to cost $775 million but independently assessed at closer to $1 billion, is facing a significant funding shortfall.

As a result, borrowings are expected to exceed $200 million.

To help cover the cost, reports suggest the Tasmanian Government plans to sell parts of the broader Macquarie Point precinct to private developers. These sites include around 17,000 square metres of commercially zoned land and a future underground car park.

Minister Abetz went on to say “activation will occur through the staged release of commercial development opportunities to attract the right investments, at the right time and to maximise the potential returns for Tasmanians.

“The transformation of Macquarie Point will shape Tasmania for generations and I know many will be excited by the prospect of being involved.”

Minister Abetz said the procurement process for the stadium would begin once enabling legislation passes through Tasmanian Parliament.

Images: Concepts for the new Hobart Stadium which the Tasmanian Government is now looking fund through extra borrowings.