Re: DSRM

[penlund <penlund@optushome.com.au>]

Hi Trevor et al

I do not want to buy into the argument about who is right & who is wrong
about the static display or operating issue and I have never been to
Dorrigo (and probably never will) but it strikes me that with $150,000
of road works etc etc the venture is so far behind the 8 ball to start
with that it does not really stand much of a chance at all.Civil works
are very, very expensive and it sound like the Council is very anti.

No bank will lend money to this sort of venture.The security is for all
intents and purposes of no commercial value.

Charitable group or not, worthy preservation or not, without a sound
business case, pragmatic and realistic management, it will not even get
to first base with a lender. Banks base their decisions on risk. This
has almost no upside at all and heaps of risk. Why would they bother. 

These ventures have to be run as businesses. There is no realitic future
with only sentiment. Sorry.

That's my two bobs worth..

Peter
East Burwood Vic






Chris wrote:
> 
> How much really do you think you they will get for the road transport
> equipment? The museum will have to put up collateral to a financial
> institution to borrow money, then you have public insurance, and the road to
> upgrade - won't the council do it for free as the museum anticipates large
> crowds visiting Dorrigo and causing a spin off to the local economy or has
> the museum got them off side?
> Then you have to prepare at least some of the collection to a suitable
> standard, and vandal and safety proof the rest as well a building toilets,
> shop, sheds, carpark, lighting, drainage, and general landscaping. You will
> probably also have problems getting council approval to open or build
> structures as some of the locals will complain (can the museum afford more
> legal fees in the Land and Environment Court) Even with a small volunteer
> labour force doing work the work you will have to use paid labour if you
> don't want to be opening in the year 2010 or later, so you will have to
> borrow at least a million. I don't think the banks will lend that sort money
> as the museum has no assets, as they will be held in a proposed trust.
> 
> Chris
> 
> .
> "Trevor Edmonds" <trevor_edmonds@dingoblue.net.au> wrote in message
> news:3ab8860a$0$25508$7f31c96c@news01.syd.optusnet.com.au...
> > Dave Malcolm wrote...
> >
> > > So why not develop part of the site so you can open, and bring in some
> > funds
> > > to assist with other developments. Surely if bus companies want to visit
> > the
> > > income would pay for the work to bring (at least part of the site) up to
> > > scratch and pay for further earth works. I think a staged opening would
> be
> > > more sencible than completing the whole museum and then opening, because
> > > when you are open you can raise funds to continue developments.
> >
> >
> > That's a good question. I answered something similar a couple of days ago
> > with:
> >
> >
> > There are a huge number of pluses to having a limited opening of the
> static
> > display. For a start we will not have to carry the entire financial weight
> > ourselves!
> >
> > But let me give you an example of one of the hidden costs that we will
> have
> > to meet before a public opening. The conditions the local council has
> > imposed on our development consent includes the requirement that DSRM pays
> > for the upgrading of the intersection of Tallowood St and the North
> Dorrigo
> > Road. The costs involved are in the order of $150,000. It does not matter
> if
> > we have one brake van on show, or every piece we have. The intersection
> must
> > still be upgraded. There are numerous other hidden costs (eg car
> > parks/disabled access/toilets/pathways etc). To achieve a public opening
> we
> > will have to borrow a large amount to fund these things. The static
> display
> > will have to be at a stage where it will cover the costs of this loan
> before
> > it will be financially viable.
> >
> > On top of this there are practical considerations. Once we have a public
> > opening, proceeding with the earthworks will be more difficult, which will
> > slow the transfer of the rest of the rolling stock to the display site.
> Once
> > we have all our rolling stock on the display site, we can sell our road
> > transport equipment, which will raise a bit of money, and save insurance
> and
> > the registration costs for the 3 units involved.
> >
> > Trevor
> >
> >