Saving the South Sydney Rabbitohs has cost Peter Holmes a Court and Russell Crowe $5 million, with Crowe putting $1million of his own money into the club on the day Mr Holmes a Court relinquished control of the board.
Yet as sources within the rugby league club play down the extent of the rift between the Hollywood gladiator and the second-generation businessman, The Australian can confirm both men stand to profit directly from a potentially lucrative property deal.
It is understood Mr Holmes a Court has sunk $4 million of his own fortune into the Rabbitohs since taking a 75 per cent controlling share of the club with Crowe two years ago.
While Crowe has been less spendthrift than his boardroom partner, he committed more than $1 million to the club's ongoing salvage operation at a board meeting on Monday - the day he accepted Mr Holmes a Court's resignation as executive chairman.
Speculation has surrounded the motives behind the club's 2006 rescue package offered to prop up the then failing licensed South Sydney Leagues Club. It now appears Mr Holmes a Court and Crowe stand to profit handsomely from a planned redevelopment of the Leagues Club's Chalmers Street premises in Redfern.
The club bought the address by open tender for $13.2 million and subsequently entered a joint venture agreement to develop the property. It is expected to deliver Mr Holmes a Court and Crowe - as part-owners of the club - millions of dollars in profits when completed towards the end of this year.
The developer behind the project, Trivest, yesterday pointed out that Crowe and Mr Holmes a Court would also bear any loss from the project. He said associated costs could climb as high as $20 million.
However, property industry experts said the completed project could fetch upwards of $35 million when completed.
Any profits flowing from the deployment will be split between South Sydney Rugby League Football Club (50 per cent) and Trivest and fellow property group Sakkara, which each hold a quarter stake in the project. The pair's profit margin will be determined by the state of the market, which has deteriorated substantially since 2006, at the end of the year when the development is completed.
Club sources said that had Crowe not pledged $1 million in funding at the meeting where Mr Holmes a Court stood down in the middle of a disastrous season, Souths' immediate future would have been in doubt.
Yesterday, the club was forced to respond to questions raised by former Rabbitohs boss George Piggins in an interview with Sydney broadcaster Alan Jones about its government-funded charity, Souths Care.
In a statement, the Rabbitohs and Souths Care described as unsubstantiated claims the charity had failed to account for $2million of federal government funding for an indigenous employment scheme.
Additional reporting: Ashleigh Wilson
Media Man Australia Profiles
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