Decision brief - 7 October 2026
Stay at 780 Upper Serangoon Road
or move to Paya Lebar Kovan CC?
What the move costs, what it saves, and when it pays back, if the CC fills slowly or fast.
PlayFacto @ Kovan Pte Ltd - Confidential - figures exclude GST and Little Forest costs
The short answer
At $7.50-8.00 psf the CC costs about the same as staying. The move only pays if it fills faster.
~$273k
one-off cost of moving, including reinstating 780 USR
Early 2029
move cost repaid, if the CC is full within 1-2 years
Never
within the 6-year CC lease, if enrolment grows only as it does at Kovan today
The tipping point: the CC must hold about 70 children all year from 2028. Kovan averages 55-65 on its current trend.
PFS Kovan only, excluding GST and Little Forest costs. Rent at the CC assumed $7.50-8.00 psf, as advised by HQ.
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 $58k, 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 break even | 52 | 49 | 51 |
The rent saving alone will never repay a $273k move. The case for moving rests on more children, sooner.
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
Staying, against moving under three enrolment paths
| Average children per year | 2027 | 2028 | 2029 | 2030 |
|---|---|---|---|---|
| Stay at 780 USR current trend | 55 | 60 | 63 | 65 |
| Move, worst case grows like Kovan today; 3 families lost | 52 | 58 | 62 | 64 |
| Move, full in 2 years 96 children by January 2029 | 73 | 91 | 96 | 96 |
| Move, full in 1 year 96 children by January 2028 | 80 | 96 | 96 | 96 |
Current trend = what Kovan achieved in 2025-26: about 28 new children each January and 3.4% leaving each month. Full = 96 children, today's capacity; we assume the CC holds the same.
Profit and payback, at $8.00 psf
A full CC earns about $17k a month; staying earns about $3k
| Profit per month | 2027 | 2028 | 2029 | Move cost repaid | All $806k + move repaid |
|---|---|---|---|---|---|
| Stay at 780 USR | -$0.2k | +$1.4k | +$2.9k | - | After 2036 |
| Move, worst case | -$2.2k | +$2.0k | +$4.0k | Not in the 6-year lease | After 2036 |
| Move, full in 2 years | +$4.8k | +$14.0k | +$17.3k | June 2029 | July 2033 |
| Move, full in 1 year | +$7.6k | +$16.1k | +$17.3k | January 2029 | April 2033 |
At $7.50 psf, each move line is about $1.1k a month better, and each payback 2-5 months sooner.
"Move cost repaid" = when the move has earned back its $273k compared with staying. All paths include the $104k franchise renewal in November 2028. Staffing: one full-time teacher per 9 children above 54 (11 at full).
Moving versus staying, money gained or lost to date
A fast fill repays the move in about two years
Full in 1 year
Full in 2 years
Worst case
+$800k
+$400k
$0
-$400k
2027
2029
2031
2033
1 year: +$683k
2 years: +$625k
Worst: -$222k
Cumulative difference between moving and staying, at $8.00 psf, from October 2026 to January 2033 (end of the CC's 3+3-year lease). Above zero, moving is ahead.
The tipping point
The CC must hold about 70 children all year from 2028
66
children steady: the move is still $106k behind staying in 2033
68-70
children steady: the move only breaks even, around 2031-2034
80+
children steady: the move pays back in about 2-3 years
Before we commit, we would like HQ to share how quickly 2-3 PlayFACTO CC outlets filled in their first two years, and their waiting lists today.
Steady = average children held from 2028, after a ramp through 2027, at $8.00 psf. Kovan's current trend gives 60-67 children a year.
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.
- Franchise renewal of about $104k in November 2028.
If we move
- 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.
- 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 | CC outlets reach 80+ children within two years | Justin, with outlet data |
| 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 $275k of cash available by February 2027 | Us |
With a fresh franchise term, the 2028 renewal (about $104k) falls away and the move pays back by late 2028 in the fast cases.
If any condition fails, renew at 780 USR for three years and keep looking for a lower-rent site for 2030.
Next three weeks
What has to happen before 27 October
| When | Step |
|---|---|
| This week | Ask Fort Aries to hold the 780 USR renewal until the tender result |
| This week | Confirm student care and 7am opening with PA; get CC outlet data from Justin |
| 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.