The Singapore Government has today (Friday) announced that it will take ownership and management of Singapore Sports Hub after electing to terminate its partnership with the private consortium that has been running it since opening in 2014.
National agency Sport Singapore (SportSG) has initiated the termination of the Sports Hub Public-Private Partnership (PPP), stating it has reached a mutual agreement with SportsHub Pte Ltd (SHPL) over the termination and the process of handover.
It will officially take over the Sports Hub on December 9, stating the move has been made with a view to make the Sports Hub the “heart of sports in Singapore” and better capitalise on the planned Kallang Alive project.
SHPL, which currently consists of three equity partners – Infrared Capital Partners, Global Spectrum Asia and Cushman & Wakefield Facilities & Engineering – was engaged under the PPP in 2010 to design, build, finance and operate the Sports Hub.
The cost of the project was borne by SHPL, and SportSG has paid an annual fee from 2014, to finance and operate the Sports Hub. The PPP was due to expire in 2035, but the terms of the project agreement allowed for SportSG to decide if and when the project should be terminated, and thereafter, for SportSG to take over the ownership and management of the Sports Hub.
In making the announcement today, SportSG said the aspirations and needs of Singapore, as well as the wider operating environment for sports and entertainment, have changed considerably since 2014.
It added that ownership and direct management of the Sports Hub will enable SportSG to have greater control and flexibility over the Sports Hub. With this move, SportSG said it will drive “stronger social, sporting and economic outcomes” through the Sports Hub, maximise its potential, and also take advantage of the synergies with the Kallang Alive development.
First announced in 2019, Kallang Alive envisions six new developments in the area around the Hub. These include the Kallang Football Hub, Kallang Tennis Centre and a redevelopment of the Kallang Theatre. Singapore’s first-ever velodrome is also proposed as part of the Youth Hub.
SportSG said there will be no penalty for PPP contract termination, with the body to pay SHPL a sum assessed in accordance with the project agreement. This will factor in the amount of the outstanding loan that was taken in respect of the construction of the Sports Hub and a fair open market value of the Sports Hub.
Local newspaper the Straits Times said under the terms of the original deal, SportSG had to pay SPHLan annual fee of about S$193.7m (£112.8m/€132.8m/$140m) from 2014 to 2035 to finance and operate the Hub. It has since paid around S$1.5bn.
SportSG has maintained the cost of terminating the PPP arrangement and taking over the operations of the Sports Hub is estimated to be comparable to the cost of continuing with the PPP arrangement until 2035. The Straits Times said SportSG would have been liable for S$2.32bn, plus future operating costs, if the PPP remained in place.
In a statement, chairman of SportSG, Kon Yin Tong, said: “We have a longer-term vision for the Sports Hub and the wider Kallang area, through which we can achieve our national sporting, social and economic aspirations.
“Taking back ownership and management of the Sports Hub will enable us to turn it into the heart of sports in Singapore and ride on synergies to develop the Kallang Alive precinct. I believe that the new entity will deliver greater community access and vibrancy in sports, entertainment, lifestyle and major event offerings to Singaporeans.
“I would like to thank the team at SHPL for their contribution of expertise in the design and construction of the Sports Hub, and for their role in this project since its opening in 2014. We look forward to building on these foundations to expand the impact and value of the Sports Hub and the broader Kallang Alive precinct for all of Singapore.”
Chairman of SHPL, Bryn Jones, added: “We support the Government’s ambitions in promoting sport among the population and harnessing Sports Hub’s potential to transform the Kallang Alive precinct and we will work collaboratively and constructively to ensure a smooth transition over the next six months.
“We wish Sport Singapore all the best as they take the project and the vibrant calendar of events forward to realise the nation’s aspirations.”
The Sports Hub is made up of the 55,000-capacity National Stadium, OCBC Aquatic Centre, OCBC Arena and Kallang Wave Mall. Singapore Indoor Stadium, which was built in 1990, was also brought under the Sports Hub banner.
Image: Singapore Sports Hub