Redevelopment FAQs

The Club will retain full ownership of all land and buildings. The redevelopment will be bank-funded through construction with interest capitalized until the ILUs leases are sold. The lease sales of the ILUs (under the standard loan/lease arrangement) will fully fund the new Club facility and the retirement community, resulting in a development profit to the club after fully repaying all debt.  

The Club commissioned a financial feasibility study of the redevelopment by Russell Corporate Advisory, an experienced provider to the club industry. The outcomes of this modelling confirmed support for the proposed redevelopment and recognised the commercial benefits for the club.

Yes, the proposed retirement community will deliver high-quality and in-demand seniors living apartments that are well-located, connected to amenities, and provide a vital option for locals seeking to downsize in the area.  The deferred management fee (or exit fee), together with the capital gain arrangement, will deliver the club much needed ongoing diversified revenue to secure the Club’s future and reduce the current reliance on gaming revenue.

The financial model of a retirement village includes a buy-in price, ongoing monthly fees, deferred management fee and capital gain. 

The Club will receive ongoing revenue from Deferred Management Fees (DMFs) and capital gains from the retirement village. This revenue will be utilised to support Club operations and community initiatives. 

Additional information on the financial model of the proposed retirement village includes:

• The Club will receive proceeds from the sale of the 50 year leases of the ILUs

• The average stay of a retirement village resident according to industry reports is 9 years

• The Club will receive a 30% deferred management fee on the entry price when a resident exits

• The Club is financially responsible for the refurbishment and resale of ILUs and will receive 100% capital uplift from any resale

Yes, the Dee Why RSL Club (by the club itself), Harbord Diggers (by amalgamated Mounties Group), Willoughby Legion Club (in joint venture with Hyecorp Developers) and Chatswood Golf Club (in a joint venture with Watermark and Pariter) are a few other recent local examples of Clubs taking a similar approach in supporting their long-term success by developing seniors living communities.  Retirement villages have been identified by many Clubs as the perfect option to diversify income, provide a much-needed community service and secure their future.

Dee Why Master Builders Club has also flagged redeveloping their current club site and incorporating home units.  

The Club has conducted a risk assessment and consulted widely with many experts in the field, as well as other clubs that have already developed retirement villages.  Some risks identified include:

• Project Financial Feasibility 

• DA approval conditions

• Project funding including bank offer, cost, preconditions, agreements, bank covenants and repayment

• Builder selection, which also needs to be approved by the bank

• Construction management including quality, cost escalation and timelines, and defect management

• Achieving pre-sale targets, expected sale prices and managing market conditions

• Retirement village planning, industry requirements and operations

• Operational impact during build phase

The Club has and will continue to actively work to manage and mitigate these risks.  This has included selecting the following consultants through a competitive process all of which included at least three final firms competing for the appointment. The following consultants were selected by the Board. 

A biography on each consultancy is available by clicking here:

• Project & Development Management – CMS Pty Limited 

• Architect – Quattro Architecture 

• Town Planner – Boston Blyth Fleming Town Planners

• Retirement village expertise (including Bank Negotiation, Sales, Marketing and Operations advice) – Chanje Partners 

• Bank – Three of the major banks have issued letters of offer to fully fund the project

• Builder – We have not yet progressed to builder selection, however any builder is required to be approved by our chosen bank and to work to a ‘fixed price’ contract

In addition to these consultants, the Board has engaged:

• Russell Corporate Advisory (a club and hospitality expert) to provide the Board with advice and financial modelling on the Club’s project options

• Thomson Geer as the club’s legal advisor as Club and retirement village legal experts

While the club has been approached by developers in the past, the Board would prefer to retain ownership of its land and control of any business operating on its land.  Therefore, subject to the support of our members, the Board has decided to undertake the development itself surrounded by a very experienced development team.  

As a result, the Forestville RSL Club Limited is ultimately taking the development risk, construction risk and sales risk.  This also means that all development and future operational profits are retained by the Club.

As outlined in the previous question, the Club is looking to manage and mitigate this risk by: 

• Development Risk: appointing highly experienced Town Planners, Project & Development Managers and Architects who have undertaken similar projects in the past;

• Construction Risk: at the appropriate time, it will run a competitive tender process and enter into a Design & Construct (D&C) contract at a fixed price with its preferred builder, to also be approved by our bank; and

• Sales Risk: it has appointed Chanje Partners, who are very experienced industry sales and marketing agents as sales agents to be paid commission on a success basis.  Chanje have been involved in a number of similar projects in the area including Hyegrove Willoughby. 

The Club is a company limited by guarantee and is without share capital.  In accordance with the Constitution of the company (Clauses 12, 13 and 14), the limit of a member’s liability is $5 per member in the unlikely event of the winding up of the company.