Decision brief - 8 October 2026 (revised)
Stay at 780 Upper Serangoon Road
or move to Paya Lebar Kovan CC?
Growth rebuilt from our actual enrolment since 2024, and what happens if another PlayFACTO takes the CC instead of us.
PlayFacto @ Kovan Pte Ltd - Confidential - figures exclude GST and Little Forest costs
The short answer
Move. Not because the CC fills faster, but because staying leaves the CC open to another PlayFACTO.
~$273k
one-off cost of moving, including reinstating 780 USR
Jan 2030
move repaid, if staying means a rival PlayFACTO opens at the CC
1 in 4
moving is the better bet if the chance of that rival is more than about one in four
On Kovan's own 2026 growth, both sites fill by 2029, so moving is not about growing faster. It is about who gets the CC. If nobody else takes it, moving leaves us about $200k worse off by 2033 than staying. If another PlayFACTO takes it, moving leaves us about $700k better off than staying.
PFS Kovan only, excluding GST and Little Forest. CC rent $8.00 psf (HQ's estimate); at $7.50 every move figure is about $1.1k a month better. Rival case: see slide 11.
What actually happened
Each January adds about 30 children; we then keep 65-80% of them through the year
January (new intake)
2024
2025
2026
10
Apr 2024
17
Jul 2024
17
Oct 2024
12
39
Jan 2025
36
Apr 2025
34
Jul 2025
33
Oct 2025
25
53
Jan 2026
45
Apr 2026
42
Jul 2026
42
0
20
40
60
Full-time children billed a school fee each month, from the PFS Kovan Accounts item reports (2024-2026), duplicate August 2026 block removed. Jan 2025: 29 new joined (12 to 39). Jan 2026: 30 new joined (25 to 53). Kept Jan to Dec 2025: 64%. Kept Jan to Sep 2026: 79%, flat since July.
What the history supports
Three growth paths from our own numbers; on the middle one, 780 USR is full by January 2029
| Growth path | Join each January | Still here a year later | 2027 | 2028 | 2029 | 2030 | Full (96) by |
|---|---|---|---|---|---|---|---|
| Slow - 2025 repeats 2025's intake and drop-out, every year | 30 | 64% | 56 | 60 | 63 | 65 | never |
| Base - 2026 pattern, bigger intake used for every scenario that follows | 34 | 76% | 65 | 79 | 85 | 85 | Jan 2029 |
| Strong - deposits all join, fewer leave | 40 | 85% | 75 | 89 | 89 | 89 | Jan 2028 |
Supports faster growth
20 P1 deposits already paid for 2027, against 6 at this point last year. 2026 retention is 79% so far, up from 64%.
No graduations yet
Today's 42 are P1 25, P2 10, P3 5, P4 2. Nobody reaches P6 before 2028, so every child kept stays on the roll.
Points the other way
January intake has been flat at 29-30. Oct-Dec 2025 lost 8 children; if that repeats, 2026 ends near 34, not 40.
Average full-time children per year, from 42 in September 2026. Deposits: 20 per the 6 Oct report; our item report shows 18 deposit invoices by October 2025 for the 2026 intake, not 6 - to confirm.
What moving costs
About $273k, mostly fitting out a bare unit
| One-off item | Base estimate |
|---|---|
| Renovation, design and build | $140,000 |
| Full aircon system with fresh air (unit has none) | $40,000 |
| Design, QP/PE and PA submissions | $12,000 |
| Sprinklers, electrical, CCTV, signage | $18,500 |
| HQ relocation and design fee (to confirm) | $15,000 |
| Moving, legal and stamp duty, net | $2,200 |
| Reinstating 780 USR on exit | $45,000 |
| Total | about $273,000 |
Range
About $210k-370k, depending on the aircon, power supply and a water point.
Deposits
A new deposit of about $55k-58k (three months' rent at $8.00, possibly plus service charge - to confirm from the tender kit), offset by the $56k we get back from 780 USR.
Based on 2023-24 fit-out actuals at 780 USR ($178,684 fixed fit-out). Net line: moving $3k, legal $1k, new stamp duty $2.6k, less $4.4k of renewal stamp duty and legal avoided.
What it costs to run
At a tender rent of $7.50-8.00, the CC saves only $0.5k-2.4k a month
| Per month | Stay at 780 USR | CC at $7.50 psf | CC at $8.00 psf |
|---|---|---|---|
| Rent | $19.9k, then $20.7k | $17.2k | $18.4k |
| Service charge and own aircon upkeep | included | $1.0k | $1.0k |
| Total premises cost | $19.9k-20.7k | $18.2k | $19.4k |
| Children needed to cover all costs (break even) | 52-53 | 49 | 51 |
The rent saving alone will never repay a $273k move. If moving is worth it, it is because of the children: not losing them to a rival at the CC, or filling faster there.
CC unit: #03-01 to #03-04, 2,296 sq ft, service charge $0.39 psf. 780 USR renewal rents include the tenant's contribution. Both rents assumed to rise 10% at each 3-year renewal.
The scenarios
Five futures: two if we stay, three if we move
| Average children per year | 2027 | 2028 | 2029 | 2030 |
|---|---|---|---|---|
| Stay, nobody takes the CC base growth | 65 | 79 | 85 | 85 |
| Stay, another PlayFACTO opens at the CC base growth until mid-2027, then January intake halves and more families leave | 63 | 55 | 49 | 46 |
| Move, base growth the CC grows exactly as Kovan does today | 65 | 79 | 85 | 85 |
| Move, CC full in 2 years 96 children by January 2029 (HQ's view) | 78 | 92 | 96 | 96 |
| Move, CC full in 1 year 96 children by January 2028 | 84 | 96 | 96 | 96 |
Base growth: 34 join each January, 76% kept over a year, from 42 children in September 2026. No families are assumed lost in the move. Full = 96 children, today's capacity; we assume the CC holds the same (to confirm with the fit-out plan).
Profit and payback, at $8.00 psf
Whether moving pays back depends on what staying would look like
| Profit per month | 2027 | 2028 | 2029 | Move repaid by if the CC would otherwise stay empty | Move repaid by if a rival PlayFACTO would otherwise take it |
|---|---|---|---|---|---|
| Stay, nobody takes the CC | +$3.1k | +$8.1k | +$11.1k | n/a | n/a |
| Stay, other PlayFACTO at CC | +$2.9k | +$0.4k | -$1.8k | n/a | n/a |
| Move, base growth | +$2.0k | +$9.3k | +$12.4k | Never (not by 2033) | Jan 2030 |
| Move, CC full in 2 years | +$6.7k | +$14.1k | +$17.3k | Feb 2031 | May 2029 |
| Move, CC full in 1 year | +$8.7k | +$16.1k | +$17.3k | Aug 2030 | Feb 2029 |
If we move, we are the CC outlet, so no rival can open there.
"Move repaid by" = the month when moving has earned back its $273k compared with staying. Both paths pay the $104k franchise renewal in Nov 2028. At $7.50 psf every date is 2-8 months sooner. A fresh franchise term on moving brings base growth (last column) to June 2029.
Money in the bank, Oct 2026 to Jan 2033: Move against Stay, in both worlds
Staying is better if nobody else takes the CC; moving is far better if another PlayFACTO does
Move to the CC
Stay at 780 USR
-$400k
-$400k
-$200k
-$200k
$0
$0
+$200k
+$200k
+$400k
+$400k
+$600k
+$600k
2027
2029
2031
2033
2027
2029
2031
2033
If no other PlayFACTO opens at the CC
The CC stays empty or goes to a non-competing business.
If another PlayFACTO opens at the CC
Only possible if we stay. If we move, we are the CC outlet.
Stay ends $202k ahead
Move ends $694k ahead
Stay +$570k
Move +$368k
Move +$368k
Stay -$326k
Move: $273k paid out up front
Jan 2030: Move overtakes Stay
Each line is the running total of profit minus one-off costs since October 2026, on base growth and a CC rent of $8.00 psf; deposits are left out. Both paths pay the $104k franchise renewal in November 2028. The Move line is the same in both pictures; only what staying would look like changes.
Our overall return: when we get back everything we have put in
All our money back by 2033-2035 if things go well; never if a rival opens and we stayed
| Scenario | Most money in, at the low point | All money back by | With a fresh franchise term | Years from now |
|---|---|---|---|---|
| Stay, nobody takes the CC | $834k | Sep 2034 | n/a | 7.9 |
| Stay, other PlayFACTO at CC | $1.6m, still rising | Never | n/a | - |
| Move, base growth | $1.11m | Aug 2035 | Feb 2035 | 8.8 |
| Move, CC full in 2 years | $1.11m | Jun 2033 | Dec 2032 | 6.7 |
| Move, CC full in 1 year | $1.11m | Mar 2033 | Oct 2032 | 6.4 |
| Move, slow growth (2025 pattern) | $1.19m | Not by 2036 | Not by 2036 | - |
On base growth, moving gets our money back about a year later than staying would, if nobody else took the CC. It gets there sooner only if the CC fills fast.
"Money in" counts the $806k already spent (set-up $422k plus losses to Sep 2026 $385k) and every gain or cost after it, at $8.00 psf. It leaves out interest on JY's personal loans and what the business could be sold for. The model runs to Dec 2036.
The cost of staying
If we stay and another PlayFACTO opens at the CC, Kovan shrinks to about 45 children
What we assume (to confirm with Justin)
- HQ wants brand presence; if we pass, the CC is tendered to another PlayFACTO franchisee and opens by mid-2027.
- Same brand and fees, beside Kovan MRT, newer and larger - it takes half of our January intake from 2028 (34 to 17).
- Some families switch: children kept over a year falls back to 64%, the 2025 level.
- Result: 63 - 55 - 49 - 46 children in 2027-30, losses from 2029, about $900k worse by 2033 than if nobody had taken the CC (and about $700k worse than if we had moved).
How bad must the rival be for moving to pay?
| January intake lost | 76% kept a year | 70% kept a year | 64% kept a year |
|---|---|---|---|
| 30% | 78 children Sep 2034 | 67 children Apr 2031 | 57 children Jul 2030 |
| 50% | 64 children Feb 2031 | 54 children May 2030 | 46 children Jan 2030 |
| 70% | 50 children Apr 2030 | 41 children Nov 2029 | 34 children Aug 2029 |
Each cell: how many children Kovan would average in 2030 if we stayed, and the month by which moving (base growth, $8.00) would have repaid itself compared with that.
Moving pays back before mid-2031 in 8 of the 9 cases. Only a mild rival - we lose under a third of our intake and keep 2026 retention - leaves staying better. Timing and whether HQ would place another franchisee at the CC are assumptions; ask Justin directly.
What has to be true
Moving wins if a rival is likely; staying wins if HQ rules one out
Moving wins if
- Justin confirms the CC goes to PlayFACTO either way - us or another franchisee (we put the odds above 1 in 4).
- The winning bid is at or below $8.00 psf; up to $10.00 it still repays against a rival, but a year later.
- Fit-out stays near $273k; each extra $50k adds about 3 months to payback.
- We can fund about $360k by February 2027 (about $300k from March, when the 780 USR deposit returns).
Staying wins if
- HQ commits in writing that no other PlayFACTO opens in the Kovan catchment during our lease.
- Or the rival would be mild: under a third of our intake lost and retention unchanged.
- Or October-December 2026 repeats 2025's drop (ending near 34 children, not 40): growth is then slow, neither site fills, and the $273k is better kept.
- Or the cash cannot be raised without putting the business at risk.
Odds: moving is $200k behind by 2033 if there is no rival, $700k ahead if there is; the break-even chance is about 22%. Even on slow growth, the move repays against a rival, but only by September 2031.
Risks
Both options carry risk
If we stay
- Rent after January 2030 is unknown; we assume +10%.
- An en bloc sale lets the landlord end the lease on 3 months' notice, with reinstatement at our cost.
- A new owner may raise the rent further.
- HQ may let another franchisee open a PlayFACTO at the CC, beside Kovan MRT (slide 11).
- Franchise renewal of about $104k in November 2028.
If we move
- The People's Association (PA) must confirm student care is allowed, and 7am opening (building hours are 9am-10pm).
- Rent is set by the tender; $7.50-8.00 is HQ's estimate.
- Fit-out must finish before our lease ends on 31 January 2027, or we pay double rent.
- Growth is not guaranteed by the address: we start with the same 42 children, and the fast cases are HQ's claim, not ours.
- Two separate areas may need an extra staff member.
Lease terms from the 780 USR renewal (collective sale clause 6.12, holding-over clause 6.16) and the PLKCC tender kit PLKCC-0301020304-27102026.
Our recommendation
Bid for the CC, if these five things hold
| Condition | Who confirms | |
|---|---|---|
| 1 | Student care and 7am opening allowed in writing | PA, via the tender agent |
| 2 | HQ would place a PlayFACTO at the CC whether or not we bid | Justin, plainly |
| 3 | A winning bid at or below $8.00 psf | Justin's tender advice |
| 4 | A fresh franchise term on relocation, and a capped design fee | Justin, under clause 4.10 |
| 5 | About $360k of cash available by February 2027 | Us |
If HQ will instead promise in writing that no other PlayFACTO opens near Kovan, renew at 780 USR: on our 2026 growth it fills by January 2029 without spending $273k.
If conditions 1, 3 or 5 fail, renew at 780 USR for three years and keep looking for a lower-rent site for 2030. Condition 2 is the one that decides between the two good outcomes.
Next three weeks
What has to happen before 27 October
| When | Step |
|---|---|
| Done 7 Oct | Told Fort Aries the renewal awaits HQ approval under clause 4.2; signing window runs to about 27 October |
| This week | Confirm student care and 7am opening with PA; ask Justin whether HQ would place another franchisee at the CC |
| 13 October | Site show at 2pm, with Justin, to review the unit and the rent |
| By 20 October | Decide: bid, or sign the 780 USR renewal |
| 27 October, 5pm | Tender closes |
| If awarded | December fit-out, open at the CC by February 2027 |
Tender: PLKCC-0301020304-27102026, units #03-01 to #03-04, 215 Tampines Road. Agent: Desiree Chen, Quinvest Chambers.