Harbour views, poker machines not enough to save RSL club from cash woes
A historic club faces closure three months after it asked members to pledge $2000 following a hike in rental costs.
Harbour views and poker machines were not enough to rescue The Kirribilli Club, which was placed in voluntary administration on Wednesday.
The Kirribilli Club in Lavender Bay.Credit: Rhett Wyman
Club president Lukas Bendt said the decision had been made with “great sadness”.
“Unfortunately, due to a combination of overwhelming financial, operational and hospitality market circumstances we have exhausted all available options and have not come to this conclusion lightly,” he wrote in an email to members.
Administrator Hugh Armenis said the club would continue to trade while he assesses its business, property and financial circumstances. The first meeting of creditors will be held on June 28.
Founded in 1946 for ex-defence force personnel and their families, the club opened at its present site in Lavender Bay in 2007.
The Kirribilli Club sought $2000 from its members following a hike in rental costs earlier this year.Credit: Rhett Wyman
Earlier this year, the club asked its more than 18,000 members to buy $2000 debentures after landlord Stadia Capital increased the rent on its premises overlooking Sydney Harbour.
A local news outlet reported Bendt blaming the financial stress of new rental arrangements of more than $2 million a year, in addition to a $1 million in building expenses, had forced the club’s board not to exercise a rental renewal option for the Lavender Bay site.
However, the club failed to raise enough money from members to purchase the prime waterfront block, which was bought by Stadia Capital in 2022 for $22.8 million. A shortage of suitable land on Sydney’s lower north shore stymied efforts to relocate the club.
Former North Sydney mayor Jilly Gibson, a lifelong club member, said the plan to raise money from members was “an interesting idea, but I couldn’t see it working”.
“I feel concerned for well-meaning locals who bought the debentures for $2000,” she said. “Can they get that money back now?”
Gibson said the club had been in trouble for many years.
“It’s been in financial difficulty almost from the time it opened in Lavender Bay.”
The financial woes of The Kirribilli Club follow revelations in the Minns government’s budget papers that a few dozen casino-style clubs received nearly $500 million in gambling tax concessions last year.
Yet other clubs have struggled with declining memberships and escalating costs, with some turning to property development to stave off closure.
A Clubs NSW spokeswoman said clubs were not immune to the cost-of-living crisis that has taken a significant toll on hospitality businesses.
“The combination of soaring operating costs and patrons pulling back on their discretionary spending has seen an increase in struggling clubs seeking extra support from their communities or pursuing amalgamations with larger clubs in a bid to remain in business,” she said.
“Sadly, without a lifeline, some clubs have been forced to close their doors permanently.“
North Sydney teal MP Kylea Tink said she was saddened by the plight of the club.
“We’ve held a number of events there from our election night event to International Women’s Day breakfast, so it will be sorely missed by the people of North Sydney if the club cannot be saved,” she said.
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