Inside the schism that has left Sydney’s ‘mini-city’ housing deal on life support

Australian Turf Club chairman Peter McGauran is not naive. A former Howard-era agriculture minister and veteran of National Party politics, he knows that the voices opposed to his era-defining proposal to shut down Rosehill Racecourse are winning in the public domain.

And yet, he remains bullish about his chances of turning the 60-hectare site into a “mini-city” of 25,000 homes.

“People have underestimated us,” he says. “It’s not unexpected that the anti-sale protagonists are vocal and have the field to themselves at the moment. But I’m excited. It will be a very different debate when all the details of the proposal are provided for members.”

But almost a year after McGauran stood with NSW Premier Chris Minns to announce the massive, city-shaping plan to close Rosehill as a racecourse after 130 years, those voices are getting louder, and closer.

Australian Turf Club vice chairman Tim Hale. Divisions of the board of the race club have exploded into public view in advance of director elections later this month.Credit: Steven Siewert

McGauran’s vice chair, Tim Hale, for example, has a very different take. Hale says he believes “a substantial majority of members will vote against” the Rosehill proposal when it is finally presented to ATC members in April.

His belief, he says, is based on conversations with “hundreds” of ATC members who oppose it, and scepticism over the accuracy of the $5 billion sale value, which his chair has publicly touted for the sale. The proposal, he says, is “not feasible”.

The two men are now openly exchanging hostilities. McGauran accused Hale of talking “outside both sides of his mouth” over the deal. Hale said his chairman had exaggerated the board’s support for the proposal. The Herald makes no suggestion as to the correctness of either claim.

The divide, even in the ATC boardroom, is emblematic of the issues facing a deal the Minns government has described as a “once in a generation opportunity”.

The plan to sell Rosehill has been beset by issues from the outset.

NSW Premier Chris Minns with ATC chair Peter McGauran announcing the plan to develop Rosehill Racecourse into a “mini-city” for 25,000 new homes in December last year.Credit: Dion Georgopoulos

High-profile racing figures, including champion trainer Gai Waterhouse, have been vocal in opposing the sale. Almost a year after it was announced, tensions over the proposal threaten to derail it entirely.

“It has been shambolic, to put it politely,” said David Walter, one of 10 members running for two open board spots at the ATC’s annual general meeting this month.

“We seem to be seeking to sell an iconic racing site and venue in Sydney with no realistic prospect of a replacement in a comparable venue [and] valuations which appear to be all over the shop.”

Walter’s view is not an outlier. Most of the candidates have expressed significant doubts about the proposed sale, ranging from outright hostility to concerns over what they view as a flawed process.

That could have wider repercussions if a reconstituted board decided not to pursue the sale further. “I think it’s a real possibility,” Walter said.

There are many reasons some ATC members oppose selling Rosehill.

A parliamentary inquiry probing the deal has focused on how the idea for the deal was originally hatched, during a meeting between Minns and his long-time friend Steve McMahon, an official at the ATC, without the knowledge of the board.

For other reasons, the plan may struggle to win support from the ATC members, including questions over the mooted $5 billion price tag for the land and a growing perception that no alternative course has been identified.

On the latter point, the ATC identified the historic brick pits site at Sydney Olympic Park as an alternative, near a future Metro station and in the heart of western Sydney. Its only drawback is significant: stringent environmental rules that prohibit development due to endangered green and golden bell frogs.

The site was earmarked as a venue for the 2000 Olympics, but the presence of the frogs thwarted the plan. NSW Planning secretary Kiersten Fishburn recently poured cold water on the idea.

John Coates, the Australian Olympics supremo and a long-time ATC member who is backing Hale’s re-election to the board, believes it is “never going to happen”.

“For the same reasons we weren’t able to for Olympic venues. Because of the special frogs,” he said.

McGauran for his part insists the brick pits remain a viable alternative, but he said the ATC was investigating other options.

Perhaps the most compelling evidence of the strain the Rosehill sale deal is under, however, is the schism on the board.

In August, Hale and one of his fellow directors, Caroline Searcy, appeared before a parliamentary inquiry into the sale.

Searcy, a Sky Racing host and media executive, made a point of emphasising to the committee that the board had not signed off on a sale, saying she had an “open but somewhat sceptical” view on the proposal.

“I didn’t get on this board to be selling assets that are as important and as big as Rosehill racecourse,” she said.

Hale cast doubt on the $5 billion figure McGauran has touted as the likely sale price. It was a figure he had “a great deal of difficulty in accepting, and I have never accepted”.

Disagreement over the value of Rosehill is largely down to the interpretation of an ATC valuation that has not been released. In essence, though, the issue is how long it might take to recoup that price. Hale says the analysis showed it would take 28 years, and a figure of $1.6 billion is more realistic. That price, Hale and McGauran concur, would make the sale unfeasible.

But McGauran says the eventual value could be higher than $20 billion, depending on how a development was structured.

Hale is the only current board member up for re-election and has been endorsed by high-profile opponents of the sale including Waterhouse. His comment to the Herald that “a substantial majority of members will vote against” the deal drew a sharp rebuke from McGauran, who accused him of speaking “out of both sides of his mouth”.

“Tim Hale was a member of the board which unanimously decided to pursue the proposal and put it to the vote. He has never resiled from that position on the board but seems to talk out of both sides of his mouth with individual members,” he said.

“People will have to make up their own mind as to whether Mr Hale’s protestations are influenced by him facing an election.”

But Hale said the claim the board had been unanimous in its support for the proposal was untrue, lifting the lid on what he said was pushback to the proposal from directors.

“I voted against both stage 1A and 2 of the proposal, as did other directors, and I objected to the lack of time for proper information and consideration of both,” he said.

Start the day with a summary of the day’s most important and interesting stories, analysis and insights. Sign up for our Morning Edition newsletter.