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Hibiscus Coast RSA faces uphill financial battle

11 Apr 2017 10:53 am

4 Comments

The Hibiscus Coast Community RSA is battling to keep its doors open. President Frank Coggan (right) is pictured with long-time members, from left, Peter Cowlishaw and Les Watkins.
As Anzac Day approaches, the Hibiscus Coast Community RSA is fighting for its financial survival.

This is not the first time the local RSA has struggled to balance its books (HM March 18, 2015) – something its president says is largely due to falling attendance by its 3500 members at its restaurant and bar.

Developers have been eyeing up the RSA’s site in residential Whangaparaoa for a long time and sale of part of that land could provide a reprieve.

Last weekend, members gathered for an extraordinary general meeting to decide whether to accept any of the options put before them. Three separate development proposals have been made for part of the 2.8ha site on Vipond Road. The front-runner is Coastal Properties, owned by Brendan Couglan, which wants to build a 120-apartment retirement village. Another option, suggested by members, is that the RSA sells the land it owns on the hill, up from Melia Place. Acceptance of any one by a two-thirds majority at the meeting will put the RSA back in the black, temporarily at least, whereas if all are turned down, it will be forced to close its doors and dispose of assets to pay creditors.

Whichever way that vote goes (the decision was made after this paper went to print and is linked to this story at localmatters.co.nz) the long-term future of the RSA hinges on its ability to turn a profit.

President Frank Coggan says there is no doubt that improving income is the biggest challenge. “There is a lot here, including affordable meals, drinks, darts, bowls and snooker. But there’s big competition. We need to adapt to a changing market and find a secret remedy but we’ve yet to do so,” he says. “Selling part of our land would only be a temporary fix. It would take around 10 percent of members to use the club once or twice a month to turn our fortunes around.”

He says if the RSA has to close, its welfare and other services would need to continue in some way.

Mr Coggan says that the RSA needs to bring in $150,000 a month just to break even. The power bill is around $4000 a month and capitation to the national body costs $35,000 annually. He says things have been touch and go for a while, but a sudden plunge in takings over summer was the last straw. Income fell by $40,000 last November, and by $20,000 in December through to February. Mr Coggan says that changes made in the restaurant should improve the March figures.

Paying wages is the top priority and staff have been excellent, getting their shoulders behind the organisation. “We’ve been up front with them and they all want to see the place survive,” he says. “Janet, who has been behind the bar for 25 years, broke down when I told her about our situation.”

The process has caused uncertainty and turmoil. There have been a number of resignations from the executive committee in recent weeks. A group of 70 members also made a failed attempt at a vote of ‘no confidence’ in the committee.

Long time members Les Watkins and Peter Cowlishaw say that hearing the RSA was in trouble, via a letter last month, was “a terrible shock”. Both had to reduce their attendance at the club once they could no longer drive but they say the veterans value its services, which include coordinating volunteers who drive members to and from medical appointments, hospital and home visits, advice and advocacy.

“There’s no way we want to see the boys thrown out of a club that’s so essential to them,” Mr Cowlishaw says.
“However, if that does happen, I hope they relocate somewhere flat on a bus stop so I can go more often.”

Welfare officer for the 600-strong Women’s Section, Win Harvey, says the women would miss the social get-togethers that the RSA provides and support advisor Chandra Newman, who visits members at home and keeps their stories and photos in a special book, agrees. “There is a lot of laughter in here and for many people who live alone, we provide a caring face. There are so many RSAs closing – we want to be the one that doesn’t close.”

Anzac Day services will be held as usual on April 25.
 
UPDATE: RSA turns down development options
Members of the Hibiscus Coast Community RSA have rejected three proposals to sell part of their site to developers.

A sale was seen as a last-ditch attempt to put the organisation, which is facing bank foreclosure, back in the black temporarily.

Feelings ran high at the meeting, which was held on Sunday, April 9 at the RSA in Vipond Road. More than 350 members attended the three-hour long extraordinary general meeting.

President Frank Coggan says that the preferred option, which was Coastal Properties’ proposal to develop a 120-apartment retirement village, got 50 percent of the vote.

However, a two-thirds majority was needed for acceptance of any of the development proposals.

Mr Coggan says he will speak to the bank this week. If the bank forecloses, the RSA will have to close its doors and sell its assets, including its 2.8ha site, to pay creditors.

Even if there is a last minute reprieve, the RSA will have to solve a cashflow problem that will require bringing a lot more punters into its restaurant and bar on a regular basis.

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4 Comments

John Campion says ...
Sadly this club is not the only RSA or non-RSA club being run by committees that has failed in the last 10 - 20 years in New Zealand. The clubs constitution probably prohibits a business-like management approach due to the focus needed to primarily look after their aging members, restrict club membership (in the past) and support the organisation at a national level. The $35,000 per year needed just for the national body must be crippling on it's own. Therefore a change in the management structure should be the primary focus. I'm sure this can be achieved whilst still assisting those aging members requiring club and community support. Other clubs on the North Shore with less facilities for members have managed to increase membership and club participation plus return to a positive trading position just by opening up membership to the wider community and reducing the membership fees to just $25 for over 60's ! If the national RSA organisation is preventing a radical restructure at a local level, then the Hibiscus club to go it alone !!
Eric Blake says ...
You should do some more research with your proposed purchasers and get a deal the guarantees annual income for the club. What would they pay to lease the land for development instead of buying it? That would get you a firm base income that should guarantee your survival. Get a lease value assessment and go to market. (Eric Blake, GM, Marsden Asset Management, The Nautilus Orewa.
Les Watkins says ...
In view of the disappointing outcome of the Sunday meeting I have to agree with D Betty. Unless there is some miraculous change of heart -- and it becomes possible to sell to Coastal properties and then work on improving the monthly income of the club such as, for instance, by renting out the dining area for special functions etc -- there is sadly no alternative.
D Betty says ...
There is no choice,sell the land,it's all gone otherwise.
Sell the land,pay off debt,invest pro seeds, R S A survival is solved,
Fail to sell the land,the whole lot is taken by Wellington
The site is in a prime position,,it's worth many millions,developers will fight over its purchase.
Stop avoiding the issue,sell to the highest bidder.there is no choice.

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