Adelaide Crows back CEO Andrew Fagan despite Brumbies revelations

The Crows remain “100 per cent supportive” of Andrew Fagan despite revelations about his time at the Brumbies.

Adelaide Crows CEO Andrew Fagan was formerly in the same role at the Brumbies. Picture: Calum Robertson.

The board of the Adelaide Crows remains “100 per cent supportive” of their chief executive Andrew Fagan despite revelations his former club the Brumbies were dramatically underpaid during the sale of their headquarters while Fagan was in charge.

The Australian yesterday revealed the Super Rugby club lost out on millions of dollars from the 2013 sale of their ovals, land and club house in the Canberra suburb of Griffith because a tax concession of up to $7.5 million intended for the club went instead to a property developer.

The details of that sale, and the circumstances surrounding the Brumbies relocating to the University of Canberra at a cost of $5m, were the subject of an investigative report by consultancy KPMG which has since been handed to the Australian Federal Police.

Fagan was chief executive of the Brumbies when both deals were signed, having held the position from 2003 until 2013.

Crows chairman Rob Chapman told the Adelaide Advertiser yesterday he had no reason to further question Fagan, who had told the board of the KPMG report. Chapman said Fagan had not been contacted by KPMG in its preparation of the report.

“Andrew did come to us — and I have spoken to him a lot,” he told the paper. “So we remain 100 per cent supportive of Andrew.”

In 2008 the cash-strapped Brumbies decided to apply to sell their premises to a property developer and relocate somewhere cheaper, using the proceeds to financially support the club. To maximise the sale price the team applied to the ACT government to have the allowable uses of the land change to permit the development of apartment complexes.

In 2012 the ACT government agreed to waive a $7.5m usage change fee for the benefit of the rugby union club. However much of that benefit was enjoyed by Canberra property developer Amalgamated Property Group.

Engaged by the Brumbies, property group CBRE, in August 2009, valuing the Brumbies headquarters as being worth between $18m and $19.5m, with the usage change fee costing around $8m.

Despite this the Brumbies signed a “put and call” option to sell the site to APG for $11.375m, valid for three years. Part of that deal was the proviso APG paid the usage change fee.

Ultimately, in 2013, APG bought the site for $11.375m and did not pay the usage change fee, which had been gifted by the ACT government, ostensibly for the benefit of the Brumbies.

The Australian has also revealed that put and call option between the Brumbies and APG — which allowed APG to but the site at the 2009 price which was already well below the CBRE valuation — was extended three times, the last time in handwriting. At least one board member claims to have been unaware of those extensions.

ACT chief minister Andrew Barr told ABC Radio The Australian’s revelations “have no basis in fact”. He said the ACT government had asked the Australian Valuation Office to conduct its own valuation of the headquarters — a large site including ovals in a prime inner-Canberra suburb — and it said it was worth $700,000. He said the AVO had determined that with usage changes granted the property was worth $10.72m.

The 2009 CBRE estimate valued the site as worth between $9.3m and $11.45m before usage changes — over 14 times higher than the $700,000 AVO figure quoted by Barr.

Do you know more?[e-mail]