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Hong Kong firm Jiayuan pledges $300 million for A-League stadium

Property Markets / Planning, Zoning, Infrastructure

Australia

Jul 17 2017

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Su-Lin Tan, Financial Review

Hong Kong-listed real estate company Jiayuan has committed to spending $300 million on a purpose-built football stadium in southern Sydney if the new Southern Expansion club wins a place in the A-League.

The group, which already holds a stake in Australia's first ASX-listed Chinese property company Boyuan, said it would fully fund the club being spearheaded by football commentators Les Murray and Craig Foster and former NSW PCYC chief executive Chris Gardiner.

"Southern's capital investments will be guaranteed by the Jiayuan Group, its subsidiary operations in Australia and other local project partners," a Jiayuan spokesman told AFR Weekend.

"Investment will be sustained by the Group's commitment to the future of its local expansion strategy. They will be working with various local partners and communities to realise this."

The trio launched the Southern Expansion campaign in March to deliver new professional football clubs for the southern region of Sydney, covering the St George, Sutherland and the South Coast football communities.

It will bid for for places in the A-League, W-League and national youth league, though Football Federation Australia has said it has no imminent expansion plans.

Jiayuan has said it will not only fund the football stadium, but also pay for $15 million in training, administrative facilities and local infrastructure for the new club.

The league is expected to deliver $7.4million to $9.2 million in additional media rights, $850,000 in additional sponsorship and an additional 1.9 million television viewers for Football Federation Australia, new research by sports marketing consultancy Gemba shows.

The proposed club, known for now as Southern Expansion, expects home game match attendances of 185,000 a season, Gemba says.

"The almost unanimous view of football fans around the country is that the game needs to continue to grow and be ambitious, beyond the current 10-team competition as soon as practicable," Southern Head of Football Craig Foster said."

Since 2012/13, as highlighted by the analysis, there has been flat regular season attendances, along with low growth in subscription TV viewership. Expansion is critical to lifting exposure, investment, support and to grow the football economy, too often crying out for additional income today.

"Jiayuan sees the league as an opportunity to accelerate its global expansion plans, which include local community projects with a special interest in team sports, such as football.

It saw its presence in Australia with Boyuan as an opportunity to fund a new Australian team, which it hopes would eventually win the Asian Champions League.Already, the A-League club Melbourne City is owned by Chinese-backed City Football Group.In Europe, Chinese investors have put money in Manchester City, Atlético Madrid and Lyon.

China's rich list The Hurun Report said Chinese interest in football, particularly in European, is "huge".

While Beijing has increased scrutiny of Chinese global investments in recent times, the $860 million Jiayuan believes the Chinese government is still in favour of sporting club investments.

SOURCE: Financial Review

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