The house site at 50 Miro Street next to the High Performance Sports Centre has been sold to Bay Venues Ltd for $618,750 to allow expansion of the high performance centre.

The council had to approve the increase in expenditure by BVL which is a council controlled organisation.

Bay Venues Ltd now owns 50 Miro Street. Photo: Chris Callinan.

The council approved the development of the HPSC in February 2015, and provided $977,000 to BVL to undertake re-construction of the former cosmopolitan club. In June 2015, the council paid another $150,000 to plug leaks discovered after the cladding was removed.

Now known as the University of Waikato Adams Centre for High Performance Sports (the HPSC) was transferred to BVL. 50 Miro Street was proposed for sale to contribute to the funding.

BVL approached the council to buy the property in September 2015, but later sought an extension.

The HPSC expansion into the property was raised as a possibility by BVL from the outset and discussed between council and staff in early 2015. It became feasible by June 2015, by which time BVL was confident of its value to the centre.

Associated uses, apart from additional training area and associated services, could include car-parking or ancillary activities like support offices for high performance teams, or accommodation options for athletes.

The HPSC is a successful project and has attracted elite athletes to Tauranga and showcased a purpose-built facility that athletes from all around New Zealand are coming to train at. Given the proximity of the property to the HPSC it is a good option to enhance the facilities on offer to the New Zealand elite sporting community. BVL will report back to Council setting out the options to integrate the property into the HPSC.

Councillor John Robson voted against it, saying the $600,000 value is too low because the value attributed to the asset on transfer impacts on the financial performance of the HPSC.

'If it's taken into the HPSC at relatively low value the effective return looks good,” says John. 'If it's taken into the HPSC at a relatively high value the effective performance looks worse. I believe it's important if we are going to judge the HPSC on a commercial basis, the value of the asset should reflect its value to the HPSC as if it was acquiring it on a no ties basis.

'The asset should be properly valued. I believe it's being transferred undervalued. This is not about who owns it, ultimately it stays within the consolidated balance sheet.

'It's about effectively representing the financial performance of the HPSC. I backed this project, I believe it will not make a substantial difference to the effective operation of it. But I would not like to see the figures we get in future defectively overstating the performance of the HPSC, because we have transferred an asset at value below market rates when part of the initial thinking was that this thing performed as a financial entity.”