Council-owned company Dunedin Venues Management Ltd’s (DVML) annual rent for the stadium has been cut from $2.6 million to $1m per year.
It is on top of the extra $2m the council had set aside for the company in the draft long-term plan.
Papers to be presented at the council’s finance and council controlled organisations committee said the rent reprieve would continue in following financial years pending the results of a Ernst & Young review of DVML’s structure.
The moves to shore up DVML’s future come amid a difficult period for attracting large-scale events and mounting concerns the opening of Christchurch’s $683m Te Kaha covered stadium next year will make the environment even tougher.
Semi-retired promoter Phil Sprey, who has more than 40 years’ experience in the business and brought Elton John’s show to Forsyth Barr Stadium in November 2011, said any review would be timely.
"But it can’t be about recriminations; it has to be about moving forward."
Not only were major concerts less likely with the arrival of Te Kaha next year, there could also be fewer All Blacks matches, he said.
"I would obviously chase other sporting opportunities.
"If they had an increase, say, in women’s rugby or football and your stadium becomes more the national home of something like that [the stadium] could increase the volume of activity by isolating a part of the whole thing."
Maximising the stadium’s relationship with the University of Otago could also be another way forward, he said.
"You’ve got a university parked right up against the stadium, so there will be an encouragement there to do something that evolves around the educational side ... things like an Olympics just for universities — basically using the facilities that already exist," he said.
The six-monthly report for Dunedin Stadium Properties Ltd, which holds the ownership of Forsyth Barr Stadium, said the decision to slash the rent for the stadium was made as an "interim" measure to support DVML while the review takes place.
It was made on the basis the review "will give rise to future changes to the company’s financial forecasts to provide a more sustainable long-term model for both Dunedin Venues Management Ltd and Dunedin Stadium Properties Ltd".
DVML’s reporting year began with hosting an All Blacks test match against England in July last year — it recorded a profit before tax of $191,000 for the half-year period ending December, compared with a profit before tax of $1,049,000 for the same period in the previous year, which included the 2023 Fifa Women’s World Cup.
The All Blacks play France at Forsyth Barr Stadium in July this year, while there were "strong sales" reported for the upcoming cricket matches (White Ferns v Sri Lanka and Black Caps v Pakistan) on March 18 at the University Oval.
DVML chief executive Paul Doorn said yesterday the review included a focus on "exploring the best ways to position DVML to enable it to continue to bid and hold future major events".
"The review is still ongoing — the city council will say more when it is completed.
"In the interim, to enable DVML to remain competitive when securing additional content for Dunedin, some adjustments have been made to the cash flows between Dunedin Stadium Property Limited and Dunedin Venues Management Limited."
The All Blacks playing England in July last year brought $13.7m direct additional expenditure into Dunedin, he said.
In February, council chief executive Sandy Graham said there was a "piece of work going on that is looking at the operating model for the stadium, and so until that work is complete, we do need to make some allowance for the outcome of that review".
