The Tanglin Club SGM Document

i:vj THE

Tanglin Club FOUNDED 1865

Notice Of Special General Meeting To Approve The Tanglin Club Master Plan & To Proceed With Development

Date of meeting: Monday 22 March 2004 Time: 6.00 pm Venue: Churchill Room, The Tanglin Club

CONTENTS

Notice Of Special General Meeting Executive Summary

2

Letter From The President

3

Phases Of The Master Plan

4

Features Of The Master Plan

6

History Of Our Club's Development Cash Flow Projection, Notes & Assumptions

7 8

Incremental Sources Of Income

10

Site And Floor Plans

11

Frequently Asked Questions

24

1

Legend

CLAYMORE HILL

BLOCK B

BLOCK

BLOCK

BLOCK A

n SQUASH COURT COMPLEX

DRIVEWAY

CARPARK'

PLOT A PLOTB

General Committee 2003/04.

Dr Alex K H Doi President

Yap Boh Pin Vice-Presldent

Philip Bang Honorary Treasurer

Glenn Bryce

Clare F Moreton

Edwin Khew

Nanette Sandford

Dr Kaizad Heerjee

Roland Tan

Alan Jones

Dr Albert Wee

NOTICE OF SPECIAL GENERAL MEETING

Pursuant to Rules 34 & 35, Notice is hereby given that a Special General Meeting of the Members of The Tanglin Club will be held at the Club on Monday 22 March 2004 at 6.00 pm.

BUSINESS

To consider and, if thought fit, to pass the following Resolutions: 1A

That the Master Plan as presented is adopted as a road map to update and upgrade the Club and, subject to minor and necessary modifications, be implemented according to Resolution 1B below, and it is understood that:

(i)

the General Committee shall keep members updated on the status of the upgrading of the Club on a quarterly basis and be empowered to do all things necessary overseeing the upgrading but not limited to engaging a professional Project Manager,

(li)

(iii)

amounts indicated include all professional fees, 5% contingency and fittings/furnishings,

that at any time the Club's Special Reserve should not fall below $10 million at the commencement and for the duration of each phase without the membership's approval of a recovery plan.

IB

That if Resolution 1A above is carried, the General Committee is to proceed with the implementation of the

various phases of the Master Plan as detailed on pages 4 and 5 according to one of the following options: Option 1: Phase 1 only ($11 million) or

Option 2: Phases 1 and 2 only($19 million), or Option 3: Phases 1, 2 and 3, I.e. all phases($23 million).

2

In the event that Resolution 1 is not carried, that the General Committee contact either one of the architects

of the other two cash prize winning proposals of The Tanglin Club Master Plan Architect's Competition to modify their proposals for adoption as the Master Plan to update and upgrade the Club; and thereafter to seek the members' approval at a future General Meeting to embark on the Master Plan; and it is understood

that the choice of which architect to contact is solely within the discretion of the General Committee. w

Dated: 28 February 2004

By Order of the General Committee

SR/AW TOFT

General Manager

A reminder that membership cards are required to be shown to permit entrance to the meeting room.

Please bring this booklet to the Special General Meeting.

1

EXECUTIVE SUMMARY

We have done what you asked of us.

• The General Committee has executed Its tasks as mandated by the members at the Special General Meeting held on 27 November 2002.

Approve the Master Plan and one of the options.

• The Tanglin Club still urgently requires a Master Plan to guide its redevelopment; continued adhoc development \wastes time and resources and denies members a much-needed, better Club.

• The General Committee asks that members approve the plan on offer and further accept one of the three options provided:

•

Option 1($11m)closely follows the winner's submission of the design competition, which was based on a general list of members'"needs and wishes"(This is an Adequate option).

•

Option 2($19m)caters to a more rigorously developed and comprehensive members' list of needs and"* wishes, while bearing in mind construction scheduling and funds availability (This is a Good option).

•

Option 3($23m)represents the most complete list of needs and wishes, while bearing in mind construction scheduling and funds availability (This is the Best option).

• Simply put, "the more we spend, the better Club we get". The features, facilities and designs in all three options represent the best we can do following advice from professional consultants and members.

We can afford to proceed and have put safeguards in place.

• Options 1 and 2 are easily affordable, almost irrespective of what happens within daily operations. Option 3 is affordable provided a major catastrophe does not strike the Club. All three options improve our operational efficiency.

• Sufficient financial safeguards , e.g. a $10 million Special Reserve, have been put in place under any option selection so that the Club and its members' best interests are preserved.

^

The timing Is right.

•

Disruptions are inevitable during the expected three to four year construction period, but they have been planned so as to minimize members' discomfort and so that no current facilities would be closed down until an alternative would be available.

• Given the state of the construction industry, the timing is right to start now.

• We know what we want and what we can afford, and we have been given authorization to build it with no Government

development charge on our "visibly idle" land (provided construction commences within the next year or so).

Say "Yes" to our and future generations.

• It is time for us to regain our place as the premier club in Singapore. Your support at this SGM is crucial.

LETTER FROM THE PRESIDENT

My dear fellow members,

This is not my Master Plan. At most, I can only claim to having remained focused. This is the Club's Master Plan.

It has taken close to three years to materialize - initially to review all past efforts, study the various feedback questionnaires conducted and determine Club values and philosophy. Three sub-committees (pertinently consulting

relevant professionals and authorities) and various special working groups built on these over this time. Grateful thanks are due to successive General Committees and many members who have put much effort into developing the Master Plan (MP).

Our management, in particular the head of maintenance department, must be thanked for support, analytical input and co-ordination. We also appreciate the invaluable assistance of the Singapore Institute of Architects.

A two-stage architect's design competition was conducted in absolute transparency via an audit firm as go-between.

The winning design was then refined, a necessary step as there was no possibility to do this during the competition, based on the "needs" and "wish" lists approved at the November 2002 Special General Meeting. We now have the ^Master Plan, tailored to most interest groups.

Our tired Clubhouse and sports facilities of over 22 years need updating and additional facilities are required to complement the existing, to bring us up to speed with lifestyle trends and demands.

What the Master Plan will achieve for us:

1. A development road map executed by well-coordinated phasing that allows for best build value and timely use

of our reserves, minimal inconvenience to members by using our "visibly idle" prime land across the road in tandem (e.g. no reduction in number of car park lots at any time), distinct construction contracts and proper provisions (e.g. adequate long-term power supply).

2. Obviates, possibly poorly supervised, expensive, incongruous and uncoordinated adhoc projects that fix problems on a fire-fighting basis.

3. Improve our sports facilities to Increase Club usage, as it is those who come for sports and exercise that tend to spend more in the Club.

4. Upgrade, improving efficiency and lowering maintenance of, our dining facilities by way of better back-of-house services and area for staff.

5. Consensual means of arriving at the end product so as to ensure improvements are built around and for members.

6. Putting surplus reserves to improve membership value - without need to tax members in any way and yet, at all times, keeping a special reserve of $10 million.

As a Club and particularly one possessing a very long and continually growing joining wait-list, our finances are resilient and income consistent. We have no debt, our land is freehold and we register very healthy annual positive cash flows. Construction costs have probably bottomed out and the construction industry at its leanest. Further and

importantly, we have obtained permission to develop without need to pay any development charge.

We must keep THE TANGLIN CLUB relevant to new circumstances and generations to come. The General Committee urges you to come and say yes to make our Club truly SOUGHT AFTER NOT ONLY FOR ITS HISTORY BUT ALSO ITS FUTURE.

With best wishes,

Dr Alex Ooi President

28 February 2004

PHASES OF THE MASTER PLAN

Phase 1:($11 million) Kitchen Renovation

1

Renovation of the Churchill and Tavern kitchens

($1.82 million budget as approved at SGM on 27 November 2002).

Main Giubhouse

2

Conversion of existing car park (900+ sq m) on the lower 1st storey (swimming poo! level) to new "back-ofhouse" areas including: new male and female changing & rest rooms with toilet facilities: loading dock and central storeroom; maintenance workshop & bulky item storeroom; Maintenance Dept. & other offices; linen & housekeeping storerooms; storerooms for paint, chemicals and other items, and a refuse centre. This area will be connected

to the Main Clubhouse by a tunnel.

3 4

Column-strengthening works for 3 new half-decks of car park (to be built in future).

Reconfiguration of existing staff areas on the lower 1st storey (Main Clubhouse basement level) into a new statf dining area; stewards' and other storerooms.

5

New lift at existing driveway between the Main Giubhouse and the car park serving the lower and upper 1st storey (Swimming Pool and Tavern levels).

6

Alteration of part of the current Jackpot Room and construction of a new covered terrace (-70 sq m) adjacent to the Wet Bar to allow access from the new lift and to provide more space for open-air dining, sitting and recreation.

7 8

New storerooms and deli (adjacent to the Tavern kitchen) on the upper 1st storey (Tavern level).

New storage and handicap toilets on the lower 1st storey (swimming pool level) and renovated toilets at the upper 1st storey (Wet Bar level).

9

Conversion of existing driveway (ramp) between the Main Clubhouse and the car park to common areas, with walkway and planter boxes.

10 New electrical supply substation/switch room with new main switch board, transformer, etc.

Sports Complex

11 Erection of a new building comprising 3 half-decks of car park (85 spaces) and two open-air tennis courts.

12 Provision for mechanical & electrical works for car park decks, open tennis courts and further extension of the building.

^

Others

13 Landscaping, external works, consultants' fees, site administration charges, submission and all other relevant fees are Included.

Note: We have been advised by our consultants that if there is a construction break between Phases 1 and 2, the

Sports Complex will cost an additional $600,000.

PHASES OF THE MASTER PLAN

Phase 2:($8 million) Sports Complex Completion of a building comprising 3 half-decks of car park {85 covered spaces) and two open-air tennis courts, with:

1

On the lower 1st storey(ground floor); entrance lobby and reception area(~100 sq m); Sports & Recreation Dept.

office (-50 sq m); Pro shop (-25 sq m); meeting room (-35 sq m); two lifts serving all floors, and a guard house; 2

On the upper 1st storey (new tennis court level); male & female changing rooms(-300 sq m); conversion of two tennis courts into indoor courts; sitting & viewing gallery with direct access to the indoor tennis courts; walkways connecting this level to the Squash Centre and four outdoor tennis courts;

3

On the 2nd storey; open-air Sports Bar, lounge & function area(-600 sq m)catering to a variety of other activities, e.g. balut, pool and darts; male & female toilets; covered viewing galleries for the Indoor & outdoor tennis courts; and, provision for bridge link to the Main Clubhouse;

4

^

On the 3rd storey (overlooking the tennis courts on one side and Draycott Drive on the other); a fully-equipped

gym (-500 sq m)and an aerobics studio (-75 sq m), and male & female toilets;

5

On the 4th storey; Billiards/snooker room (-200 sq m)for 5 tables, with a marker-manned refreshment counter; 5-lane, open-air lawn bowl green with lighting (-1,400 sq m); covered viewing gallery for lawn bowls; hair salon (-100 sq m); and male & female toilets;

6

On the 5th storey; spa/health centre (-400 sq m) with male & female changing rooms & toilets, and

7

On the 6th storey; mechanical & electrical works room.

Others

8

Landscaping, external works, consultants' fees, site administration charges, submission and all other relevant fees are included.

Phase 3:($4 million) Main Clubhouse

1

Construction of 3 new half-decks of car park.(This will likely involve closing the current Main Clubhouse car park

for a while. By this time the Sports Complex car park will be complete.)

New cigar/smoking room adjacent to Tea Lounge.

3 4

New Wine Bar (with provision to open doors for additional al fresco dining area) and Cyber Cafe occupying current F&B office and Billiards Room.(By this time billiards/snooker would have moved to the Sports Complex.)

New F&B office relocated to current Hair Salon.(By this time the Hair Salon would have relocated to the Sports Complex.)

5 6

Renovated General offices and toilets (with minor reconfiguration) at the existing location.

Conversion of existing gym into new indoor children's play room, accessed by a covered walkway.(By this time the gym would have relocated to the Sports Complex.)

7

Construction of new overhead bridge linking the Sports Complex (at the Sports Bar level) to the Main Clubhouse (at the Reading Room level).

Sports Complex

8

Construction of new jumbo doubles squash court at the Squash Centre.

Others

9

Landscaping, external works, consultants' fees, site administration charges, submission and all other relevant fees are included.

FEATURES OF THE MASTER PLAN

MAIN CLUBHOUSE • Visible cosmetic changes to provide a much-needed facelift.

• Better use of prime space for members' activities, e.g. conversion of F&B offices into a Wine Bar.

• Most major changes involving "behind the scenes" work with members benefiting through a wider range of service offerings and better service, and staff benefiting from a better work environment.

• improved, "friendly" amenities for the handicapped, elderly and children, e.g. lifts, walkways and toilets SPORTS COMPLEX

• Smart land use with a first-ciass facility offering the range and number of amenities expected of a Club of our standing:

• • • •

Tennis :2 covered and 4 open-air courts

• Gym & aerobics : 30 sport stations

Squash :6 singles and 2jumbo doubles courts Billiards : 5 snooker and 2 pool tables Lawn bowls : 5 lanes

• Spa & health club • Changing rooms • Sports Bar and function area

RECREATION

^

• Baiut, board games, pool, darts and many other recreational activities in the expanded covered terrace (at the Wet Bar) and at the Sports Bar(at the Sports Complex).

• Swopping and upgrading of Jackpot Room and Card Room.

• Swimming pool and landscaping more "resort style" and in keeping with that of a premier club.

• A new indoor children's playground adjacent to the outdoor play area and swimming pools providing a focal point for children's activities.

STAFF

• Staff dining, changing, locker, toilet and rest areas substantially enlarged and upgraded.

• Office areas reconfigured to make better use of space (e.g. administration office) or moved to optimize space use (e.g. F&B office).

PARKING

•

Net 129 new spaces will be available, allowing members' guests more convenient parking: 48 at the Main Clubhouse and 81 at the Sports Complex.

FOOD & BEVERAGE

^

• Wheeihouse, Tavern, Tea Lounge and Churchill Room essentially remaining as they are but with substantial backof-house improvements.

• Expanding and renovating Wet Bar; adding a Cyber Cafe, Wine Bar / additional ai fresco dining area, Cigar/Smoking area and Sports Bar/lounge area to offer members a wider variety of outlets with different themes and offerings.

OPERATIONS

• Many operational improvements, e.g. Churchill Room and Tavern kitchen redevelopment making better use of

space, allowing wider range of food styles to be prepared efficiently, and resulting In reduced headcount.

• More areas for workshops and storerooms, wider hallways and better access as a whole, improving traffic flow,

increasing operational efficiency and staff effectiveness, and lowering maintenance costs.

SAFETY & SECURITY

• Covered bridge between the Main Clubhouse and Sports Complex unifying the two sites and providing comfort and safety to members and staff.

• Separate access for members/guests and commercial vehicles, providing better link to stores and kitchens.

AMBIENCE • Harmonious blend of architectural styles.

• Still aspire to be members'"home away from home".

BRIEF HISTORY OF OUR CLUB'S DEVELOPMENT

The present Main Clubhouse was completed in 1981, a

occupied by the eight tennis courts, the Squash Centre

major milestone in the development history of The Tangiin

and the open car park, collectively known as the TC

Club's 138 years of existence. Prior to its completion, our

Sports Centre.

Club functioned in a charming old bungalow on the same site, a painting of which graces the entrance to the Tavern.

Around 1994-95, the General Committee had planned a high-rise building (of some 25 storeys of mixed usage)

The commemorative book "Forty Good Men" gave a good

based on an increased plot ratio of 2.8 (compared to the

account of the project. The building of the Clubhouse,

current zoning for recreation of a plot ratio of 1.4). This

carried out in phases to minimise disruptions and allowed

concept, to say the least, provoked much controversy,

its continued operations, was finished ahead of schedule

and the idea died there.

at a final cost of $13.7 million. ✓

in March 1996, a second major attempt to develop the

Phase 1 began in September 1977 with the building of

"sports site" was made. After some serious preparatory

the new squash courts which were opened in July 1978.

work by a leading firm of architects, a proposal to build

The new multistorey car park which began Phase 2 was

a substantial building ofsome 5 or6 storeys was presented

completed in April 1979. The building ofthe new Clubhouse

to the membership. The project costing about

began in June 1979 and was completed in March 1981.

$30 million failed to get approval.

in 1987 members approved a plan to further enhance the

Subsequent GCs deliberated on the long-term future of

Clubhouse and facitities and a development in two stages

the Club's property, and special development committees

was proposed. Phase 1 involved the redecorating and

were formed each year to study the issues of the Club's

installing of a new sound and light system in the Churchill

facilities for the members' use.

Room, the redevelopment of the Main Kitchen, the

^construction of a small satellite "grill" kitchen at the back

in 2001, when the new GC took over the responsibility of

of the Tavern, the extension of the Tavern dining area,

overseeing the Club's future needs, a Planning and

and the construction of a new Billiards Room, Card Room,

Development Sub-Committee chaired by the president

Jackpot Room and the open-air Wet Bar. Ail these were

sought more views from the membership though surveys,

completed by January 1990.

dialogue sessions and numerous meetings, arrived at two "needs" and "wish" lists which eventually were

The development of Phase 2, held in abeyance pending

endorsed at an AGM.

an appeal against development charges. Involved the

construction of a sports complex, including a modern

A new mandate was then given to the GC of 2003/04 to

gymnasium and the conversion of some of the tennis

conduct an architectural design competition to draw up

courts into a car park with new courts on the roof. Phase

a master plan which would serve as a road map for the

2 never took off.

future development of the Club.

Between 1990 and the tum ofthe century, several attempts

were made to redevelop the freehold site currently

CASH FLOW PROJECTION for a period of 8 years ending 31/1/2012(FY 04/05 to FY11/12) Amounts in S$million

Opening Cash Balance 1.2.2004 Working Capital Special Reserve Forecast cash available for development Operating Deficit Construction disruption deficit

Notes

1

2

FY04/05 Forecast

FY05/06 Forecast

23.9

(1-5) (10.0) 1

12.4

14.5

2A

(0.2)

28

(0.2) (0.3)

3A, 38 & 3C

3.6

3.4

4

0.1

0.1

Capital Expenditure

5

(0.6)

(0.6)

Renev\/ai & Maintenance

6

(0.5)

(0.5)

Cash balance after working capital & reserves

14.5

16.3

Forecast total cash available

26.0

27.8

Entrance Fee instalments

Interest Income on $10m Reserves

(0.3)

Cash Flow Projection The cash flow projection presented above was prepared by our Honorary Treasurer and his Finance Sub-Committee(FSC)teamj^ It represents the culmination of several months of rigorous debate, review of hundreds of analyses and countless historical documents about our Club and its operation. A wide range of people have been consulted: at various times members have been called on for their expertise and views; the General Manager and his team have been deeply involved, as have the General Committee and many members of the Sub-Committees.

We prepared a cash flow projection because we all want to know the answer to the question:"How much money can we afford to spend on our 'needs' and 'wishes'?".

Principles used In preparing the cash flow projection: 1 Protect the Club and general interest of members by using conservative projections.

2 Be explicit about assumptions, the rationale for them, and back this up with analysis.

3 Keep things simple and understandable for most; prepare using the details, but present only the most relevant of information.

Findings; 1 The Club has a relatively stable stream of revenues:

a Subscriptions are very predictable (and growing).

b Discretionary spending on food & beverage (our most important item), is seasonal and generally predictable, but can be negatively affected by events beyond our control, such as the Iraq war and SARS. c The Jackpot Room and guest room occupancy are important, but generally provide <15% of revenues d Variations in other sources of revenue are relatively unimportant. e Entrance fees are not strictly revenues (as they go on the balance sheet into reserves) but they are an important gauge for

our sustained ability to build reserves. With our strong demand (long waiting list) for membership, we are in good shape^ 2 a b c d e

Costs are very predictable: Most (60+ %) of our costs are fixed or semi-variable (but effectively fixed), on items such as salaries and utilities, Food & beverage costs vary directly with sales and are highly predictable, Capital expenses should be planned ahead and well-known.

Renewal & maintenance expenses should also be relatively well-known, but subject to more variability Other expenses are relatively unimportant.

3 We need about $1.5 million in working capital.

4 We have enough good information to assemble a reliable, conservative cash flow projection.

Conclusions:

1

Many members would be happy if we set aside a Special Reserve of $10m, not to be touched without members' approval, and with a "recovery plan" in place to restore the $10m in the event we had to use part of it.

2 It is safe to predict an annual, planned operating deficit of $200,000 based on historical events and our assumptions about the future.

3 Construction will negatively affect use of the Club. We believe a "disruption deficit' of $300,000 annually for the duration of the work would be prudent and more than ample.

4 Entrance fee payments in the $2 to 4 million range annually are a conservative estimate.

5 At $600,000 annually. Capital Expenditure has been "planned" at the average expenditure rate of the last ten years 6 Likewise, Renewal & Maintenance expenditure of $500,000 annually has been conservatively "planned" at the average expenditure rate of the last ten years.

7 The Master Plan, as presented. Is very easily affordable under Options 1 & 2 and probably affordable under Option 3, while still maintaining a $10 million Special Reserve.

8

3

4

5

FY06/07 Forecast

FY07/08 Forecast

FY08/09 Forecast

6 FY09/10 Forecast

7

8

FY10/11 Forecast

FY11/12

Forecast

16.3

17.7

18.7

19.6

20.4

21.2

(0.2) (0.3)

(0.2) (0.3)

(0.2) (0.3)

(0.2) (0.3)

(0.2) (0.3)

(0.2) (0.3)

2.8

2.6

2.4

2.3

2.3

0.1

0.1

0.1

0.1

0.1

2.3 0.1

(0.6)

(0.6)

(0.6)

(0.6)

(0.6)

(0.6)

(0.5)

(0.5)

(0.5)

(0.5)

(0-5)

(0.5)

17.7

18.7

19.6

20.4

21.2

22.0

29.2

30.2

31.1

31.9

32.7

33.5

Notes & Assumptions S$"000 Cash Available as at 1.2.2004

Investment Funds from Bonds and Notes

Fixed Deposit Bank Balances Bank Balances Cash in Hand As at 30/11/2003 2A

28

12,264 10,748 728 122

23,863

No change in patronage, subscriptions and other income giving an annual operating deficit before Interest income, tax and depreciation of $0.2m. This assumes the increased membership subscription from Planned Total Membership (PTM) is absorbed by increased expenditure thereby maintaining the deficit of $0.2m. Assumed no increase in membership subscriptions throughout the projected period.

Using 2003/4 financial year deficit of $0.8m as the basis for projection, a construction disruption deficit of $0.3m is provided during the construction years. This caters for possible loss of income due to the disruptions caused during the construction and relocations of the various facilities.

Notes to assumptions 2A &2B:

(i)

The operating deficit is calculated based on the average of 5 years historical figures. This averaged to $0.163m per year, rounded to $0.2m for projection purposes. In 2003/04, exceptional losses of $0.8m were attributable to SARS (40%), and the renovation works to the ceiling, tea lounge and the guest rooms (35%) cumulating to $0.6m of the of $0.8m 2003/04 deficit. Assuming SARS does not recur, the impact of the renovation and construction will be $0.3m.

ni) â&#x153;&#x201C;

In these projections, it is assumed that the Club performs at current levels throughout the period without further improvements in operational efficiency.

3A & Extra Entrance Fees as a result of approval (in January 2003) to increase PTM to 6900: As at 31 January 2004, 38

the number of Singaporean members totalled 3,314 as against a maximum level of 3,519 (i.e.51% of 6,900): This leaves 205 vacant memberships from FY 2004/05 to be disbursed as follows: FY 04/05 : 84 Ordinary & 42 associates = 126 members FY 05/06 : 52 Ordinary & 27 associates = 79 members

(I) (ii)

Only Ordinary members pay the $20,000 Entrance Fee. Associate members as spouses do not pay Entrance Fees.

Assumed that 50% of new Ordinary members pay by instalments spread over 4 years ($8,000 at joining and 3 installments of $4,000 in the next 3 years)

3C

4

Membership admissions through attrition (i.e. deaths, Permanent Absent Memberships, resignations) averaged at 9.5 Ordinary members a month or 114 new members annually. The statistics for attrition over the past 3 years indicate that 1/3 (or 42 members) were Singaporeans while 2/3 (or 72 members) were Overseas. Even the introduction of Term Membership, it is assumed there will be no less overseas Ordinary membership applicants. Assumed therefore that ali Overseas attritions are replaced by Ordinary members paying $20,000 each with 50% membership opting for the installment option as per 3(B)(ii) above.

Interest Income (net of tax) from $10m Special Reserves at 1.5% p.a.is $120,000. Recommend that the

Club maintains a Special Reserves of $10m to meet any eventuality that may arise. This equates to approximately 50% of present cash available.

5

Capital Projects for the period Oct. 1993 to Oct. 2003 (10 years) amounted to $5.5m, averaging of $0.6m annually. The Property Sub-Committee concurs to the amounts projected.

6

Property maintenance is also based on the past 10 years historical figures and average out at $0.5m. This was also verified by the Property Sub-Committee.

9

INCREMENTAL SOURCES OF INCOME

POSSIBLE SOURCES OF INCOME NOT REFLECTED IN THE CASHFLOW PROJECTION Term memberships of about 15 a year (x $4,000 = $60,000 pa).

Family member subscriptions of $20 and $60 per head per month.

Increased turnover from more family members.

As a result of increase in Planned Total Membership (PTM), increase in memberships available for regular rate of entrance fee as a result of natural attrition, now at average 114 annually. Note that this availability is already over 10 per month for Singaporean category alone in the last 4 months - taking deaths and transfers to and from Permanent Absent Memberships into account.

Interest income is likely to increase In the years ahead from increase in interest rates.

For the increase of PTM by 900, possible increase in expatriates (this includes Malaysians)joining the Club, for which 441 vacancies are available.

Increase in stature and value of our membership as a result of renewal, better facilities and more parking lots allowing possible increase of joining fee rate.

Availability of more vacancies for membership from possible "limited buy-back scheme", "further increase

in PTM","new categories of membership", etc. These should be considered only as safety options and subject to membership adoption.

The Information below shows a probable net increase of operational income.

The Master Plan raises the question of operating cost and subsequent revenues. Although these figures cannot be quantified with any degree of certainty, these projections are conservative in nature and based on past usage, best forecast and current average age of Tanglln members.

Spending patterns will change over the next few years as the younger members will undoubtedly spend more. These calculations on an annual basis are made by senior management.

VISIBLE REVENUE & SAVINGS

Revenue from

OPERATIONAL COSTS

$'000

COST OF GOODS

$'000

$■000

Sports bar

60

Staff costs

278

Sports bar

Cyber caf§ Existing F&B outlets

48

Utilities increases

360

Cyber caf6

280

Wine/cigar bar

64

Various increased activities

36

Deli

45

New spa Various sports

Total Revenue (a)

Maintenance

Kitchen staff savings Total Expenses (b)

48

(400) $286

Existing F&B outlets

29 21 120

Wine/cigar bar

38

Various increased activities

15

Deli

16

177 19

Total cost of goods (c)

$23»W

$719

Net Profit [(aHb)-(c)]

$194

POSSIBLE CAPITAL EXPENDITURE & MAINTENANCE WORKS FOR MAIN CLUBHOUSE DURING 2005-2009

Management has identified capital expense and maintenance works not captured by the Master Plan. These have been allocated priority basis and their approximate costs are as follows.

High priority, within 6 to 12 months: $253,000 E.g. Poolslde gents changing rooms, pool counter area, landscaping at children's playground.

Medium priority, within 1 to 3 years: $944,000 E.g. Churchill Room and Bar, upgrading of toilets, function rooms refurbishment, repainting of clubhouse.

Low priority, within 3 to 6 years: $198,000 E.g. Lobby floor, landscaping works.

Total; $1,395,000 * Please note that these works have not been detailed and approved as yet, and

* There is provision of $1.1 million annually for such works in the cashflow projection.

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FREQUENTLY ASKED QUESTIONS

Why do we need a special reserve, and one with $10 million In it?

We believe it is prudent to create a special reserve to cover the Club for potential catastrophic events. For example, while physical assets, employees and serving members are covered by various insurance policies, operational disasters such as those involving health, safety and/or security issues are not covered. In the unlikely event we would be forced to close the Club for many months, several fixed costs would have to be covered.

Members' current monthly subscriptions would help cover most, but not all, of these costs. We are very unlikely to ever need $10 million, but this is a number with which many members feel comfortable.

Why do we need such a Sports Complex?

The Sports Complex makes very good use of "visibly idle" land to support the Club's objectives. The proposed facilities cater to the needs of members: 2 covered tennis courts; male & female changing rooms of a size and standard befitting The Tanglin Club; an open-air Sports Bar, lounge and function area; much larger and betterequipped gym & aerobics room; larger billiards/snooker room; health spa; lawn bowls green; larger hair salon; pro shop; larger Sports & Recreation Dept. office, and 81 more covered car park spaces.

Can we afford to spend $20+ million on new facltlties?

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Yes. Even the most conservative of projections (as shown in the brochure) demonstrates we can easily afford the new facilities and still have $10 million in a special reserve. An improvement in F&B profitability and an increase in sales of memberships to non-Singaporeans and term members could significantly boost annual cash flow.

Why do we need another jumbo doubles squash court?

Demand for court time far exceeds that available. The current jumbo doubles court built five years ago Is immensely popular with squash players. During peak periods (5-8 pm weekdays and 3-6 pm weekends) there is a long queue of players waiting to play. Also, apart from social and internal tournament use, Tanglin Club is host to two prestigious and popular annual tournaments: the Singapore National Jumbo Doubles Tournament and an International Jumbo Doubles Tournament (sponsored by Ml). For both tournaments, entries are constrained by court availability.

Why do we need so many car parking spaces?

The net gain of 129 car park spaces will be achieved only after all proposed phases are completed. The new car park spaces will cater for increased demand from those using the Sports Complex. The additional car park spaces at the Main Clubhouse will allow us to have members' guests park at the Club, which will increase use

of food & beverage outlets.

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Why do we need a bridge to link our two plots of land?

This will reduce the risk of accidents to our members and provide shade against bad weather when they cross the road. Also, during big functions, in their fine clothes, those parking across the road can still cross in the rain using the bridge. The bridge will effectively provide a seamless connection between all aspects of the Club, giving it a "complete" feel and look too.

Why do we need a new gym and why does it have to be of this size?

The current gym Is far too small, claustrophobic, and inadequately fitted. The new gym and aerobics area will

occupy about 600 sq m. This size will allow us to provide a greater range and larger number of machines and equipments as demanded by our members. A better facility will bring the many members who have outside gym memberships back to the Club.

Why do we need so many Billiard/snooker tables and pool tables?

This is an increasingly popular game, particularly pool. With more than the present three billiards tables, we can organize more events that will generate more F&B expenditure and better usage of the Sports Complex and its common meeting point, the Sports Bar.

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Why do we need such a large Sports Bar? It will be a strategic viewing gallery for the indoor tennis courts, a good central lounge with poo! tables, darts, cable TV and serve as a sports functions venue.

Why do we need a cigar/smoking lounge?

This comes with lifestyle and an opportunity for us to provide a humidor for the cigar aficionados. It also then allows us to keep all other areas in the Club smoke free if we wish to.

11

Why do we need a wine bar?

Wine is gaining in popularity, not just in terms of lifestyle but also for Its positive health connotations. It will be a good meeting point as a "pure" bar that is not immediately part of a restaurant.

12

Why do we need two lifts in the Sports Complex?

Following an analysis of expected building use and waiting times, our consultants have informed us that we should have two lifts.

13 Why did we not plan to have the new lift at the Main Clubhouse car park area serve more floors?

It was not cost effective. Adding an additional floor or more of service would require the Club to spend several hundred thousand dollars on new roofing and walkways to provide access to the upper floors of the Main Clubhouse.

14

What happened to the smaller fine dining room idea?

The cost of having this replace the present general office with the need to provide a new lift and high staffing costs did not justify building it. What will be more cost effective is to make further attempts at putting Churchill Room to better use and, at the same time, kept as a fine-dining room on certain days.

15

Why don't we just update the Main Clubhouse first?

This cannot be done without severe disruption in service to members and, very possibly, closure of the Club.

Even the addition of more floors of parking will mean insufficient parking for some time if we do not make use of the land across the road prior to this.

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Why should we build when the economy is not so good?

Precisely because of it, the time to build is best now as prices have probably bottomed out and, very importantly, we save by not having to pay development charge, which can be substantial.

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