Nelson Suburban Club Struggles to Stay Afloat During Harsh Times

New Zealand gambling laws - GamingZion

New Zealand Suburban Club suffers from a lack a traffic while costs continue to mount for the once prominent destination for entertainment..

The facility initially opened for business in 1970 with a licenses for 600 members. It was touted as the hottest gaming and entertainment center to hit the street of the city of Nelson. A mere five years ago, the establishment was among the 10 best chartered clubs, while now it’s barely staying alive with all the financial troubles.

In 2009, Nelson Suburban Club was thriving while other similar competitors were struggling, according to gambling news. For instance, the Maitai Club was one business that didn’t manage to have success in the times that Suburban was successful. However, now the situation is reversed.

Everyone is jumping ship

• Nelson Suburban Club used to be a popular place while others were struggling

• Suburban discovered a debt of $300,000 owed to creditors and revenue department

• New Zealand residents known for being avid pokie machine players

The rock’n’roll club named Sun City Rockers, who have previously worked with the Suburban, have opted to make a change lest things go wrong for them. The rock club has been based at the Suburban for over 14 years, however shifting location is necessary if they want to continue their operations.

The president of Sun City Rockers, Marie Bone, explained that a potential hike in prices and uncertainty about the future has led her to look for alternatives. “They’ve been very good to us over the years. The main reason we’re leaving is because of the uncertainty. Things are happening where they want more money, I don’t think they’ve been that open with everybody, really.”

Suburban uncovered a large debt that went undocumented and essentially surprised the management. The debt stood at a staggering $300,000, which forced the club to seek financial help from its members to repay the massive amount.

General manager of Nelson Suburban Club, Neil Ross, decided to keep the information regarding the debt to hidden from the public and New Zealand gambling laws, as he tried to prevent members from paying bigger fees. Ross even sanctioned purchases that were considered necessary for the club form his own pocket.

Before long the debt was discovered by board chairman Ross Strawbridge. The money was owed to the Inland Revenue Department and some other creditors, however luckily almost half of the debt ($128,000) was paid by a single member who remains anonymous.

Following the events, Ross decided to leave his post and was soon temporarily replaced by former general manager Glen Beattie and now Rob Finlayson. Later on more details surfaced about the accounts of the once popular Club.

Expansion project didn’t work out

The Suburban has been experiencing a hard time with paying back its loans that account to a total of $2.7 million. Most of money was used to finance an ambitious expansion back in 2005, as the Club tried to emulate the success of many big Australian firms that initially offered poker machines.

New Zealand residents are known to be avid gamers, so the Suburban attempted to appeal to them by giving them the chance to score big pokie wins, although the end result amounted to nothing.

In efforts to battle the large costs of running the Club and servicing the extraordinary debt, the Suburban is looking at increasing charges and membership fees. The Returned and Services Association (RSA) combines a group of 600 individuals who transferred the Maitai Club and also have their memberships at the Suburban paid by a capitation fee of $35 annually.

The president of the RSA, Barry Pont, has stated that the organization has a plan B and is ready to move on, as members are currently exploring their options. “There are alternatives in the Stoke-Tahuna area, where we want to stay. We have told them that we won’t pay any more.”

Pont doesn’t attribute the blame of the Club’s current situation to the current board, but believes that the real problem lies in the fact that Suburban and many other companies alike put too much emphasis on pokie machines. Instead, they should have diversified their gaming portfolio and not derive all of their income from one source.

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