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S11 group founder on running migrant worker dorms.


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Source :
https://mothership.sg/2020/08/dorm-operator-s11-jonathan-cheah/

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S11 group founder on running migrant worker dorms & why communal living cannot be avoided

The S11 dormitories along Seletar North Link (S11 Dormitory @ Punggol) and Tanah Merah Coast Road (Changi Lodge II) came under the spotlight earlier this year when they were one of the earliest dormitories to produce Covid-19 clusters.

The then-rapidly growing number of Covid-19 cases reported in migrant worker dormitories prompted renewed calls for better dormitory living conditions and overall better treatment of migrant workers themselves in Singapore.

Three months on, migrant worker dormitories are still under lockdown. However, the government is set to clear all the workers in the dormitories by this week and has promised to bring up the standards of migrant worker dormitories.

And so Mothership caught up with Jonathan Cheah, founder of S11 Group which manages the Changi Lodge II and S11 Dormitory @ Punggol, to better understand what goes into running a migrant worker dormitory in Singapore.

 

 

2 takeaways from the article : 

1) Toa Payoh has fewer than 14,000 residents. 

750497431_Capture1.PNG.9f551683eda2d1f626a21c2944beec9d.PNG

 

2) Razor-thin margins. 70% of revenue goes to Rent. 30% of revenue goes to Utilities. 

In 2015, Cheah told The Businesss Times that his Changi Lodge 2 generated an annual revenue of S$15 million. The paper also reported that the Punggol Lodge would bring in an annual revenue of S$55 million when operating at full capacity.

204534981_capture2.thumb.PNG.23fa3bdeba3fe3cc726f79141306d723.PNG

 

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Supercharged
41 minutes ago, Mustank said:

Mean what?

Meaning that boss is lousy at lying.

His lies are so ridiculous that immediately pichar lobang

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It means the government needs to work with the dorm operators to form the complete solution if overcrowding is the problem ; that is if it is.
If what the dorm operator says is true then reducing occupancy will definitely result in a negative bottom line. 
it is a double dilemma for both sides and not an easy one to solve. 

we are hearing one side of the story and need to hear the other side.

as industry outsiders it’s too early to form any conclusions due to our lack of knowledge of the inner workings of the industry. 
 

trust that our efficient government is looking deeply into the matter to solve it. 
 

we have generally one of the most efficient  government in the world so we just wait Akan datang and let the show go on. 
 

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Failed bull-shitter!! 

60 - 70% revenue goes to rental, another 20 - 30% for utilities, and not forgetting salary for his team + security, maintenance cost, etc. Is he hinting he is running the dormitories at a loss?! S11 is a Charity organisation? :D

And for those who complain about high rental cost, they are the one who bidded for land with the price they deem are commercially viable. So don't cry father cry mother now...

The truth is that he is now playing victim, trying to convince the general public that his Dorm business are not making money and thus wanted to increase charges (for those workers staying in his Dorm) to recoup some of the losses.

And talking about living conditions of workers in Dorm, pictures paint a thousand words. Go online to watch video taken by CNA / mediacorp to see for yourself what are the norm. 12 workers in a 48m2 room has exceeded the government recommendations of 4.5m2 per worker btw. The only reason they are not penalized is because they counted common space into the space allocation per head, a loophole soon to be plugged. 

There are more dark secrets to Dorm operation which I shall not reveal here... [lipsrsealed]

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Questions,  he lost money for so many years and continues to operate and even added more. This is national service? When he set out this business,  the plan was always to pack it this way or along the way he pack more to make profit? Then, don't the authorities have guidelines like any other housing but leave it to them to run whatever they like? On what condition the licence was issued and who control this?

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Quote

Within a month, they found a main contractor to start building the dormitory. Along the way, the business partners also had to put proper financial structures in place to ensure that work went smoothly.

The dormitory, spread over 1.7 hectares of land in Changi, became operational in October 2011. It was able to maximise its 4,000-person capacity within nine months, and the company was on track to repay its bank loans within two years.

https://www.businesstimes.com.sg/hub/enterprise-50-2015/fresh-ideas-to-improve-the-lives-of-foreign-workers

 

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https://www.straitstimes.com/singapore/manpower/workers-describe-crowded-cramped-living-conditions

Workers describe crowded, cramped living conditions at dormitory gazetted as isolation area.

Straits Times (APRIL 6, 2020)

Fear is growing at a dormitory designated as an isolation area because of an infection cluster, with workers saying they do not have masks, and are living in unsanitary and crowded conditions.

At least six workers at the S11 Dormitory @ Punggol, where there are 63 confirmed cases of Covid-19, told The Straits Times that the rooms are infested with cockroaches and toilets are overflowing. Workers have to queue for food with no social distancing measures to keep them apart.

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means what huh? err ... tough business ... razor thin margin

so who is making the money and laughing to the bank - the bangla? 

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Supercharged

Last i heard. Say if the dorm is built for 10000workers for example. 30 to 50bucks goes to govt regardless of vacancy levels. Not sure how much now. 

 

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Turbocharged
15 minutes ago, Wt_know said:

means what huh? err ... tough business ... razor thin margin

so who is making the money and laughing to the bank - the bangla? 

Yes, obviously, because they work overtime, save a lot of SGD, send back home, convert to bangla Taka, become Taka millionaire, buy land, buy houses, go back bangladesh and become the big boss. Everyone thinks that about FW and FT.

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Supercharged
2 hours ago, noobcarbuyer said:

Source :
https://mothership.sg/2020/08/dorm-operator-s11-jonathan-cheah/

 

2 takeaways from the article : 

1) Toa Payoh has fewer than 14,000 residents. 

750497431_Capture1.PNG.9f551683eda2d1f626a21c2944beec9d.PNG

 

 

Actually the ultimate CMI from this article is ..... the writer "Joshua Lee"

He actually believe the Toa Payoh part!

image.thumb.png.75a782a895aa233786ccf1072bfec622.png

MLM scheme salesman please quickly contact him to get a quick easy sale!

 

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58 minutes ago, Wt_know said:

means what huh? err ... tough business ... razor thin margin

so who is making the money and laughing to the bank - the bangla? 

Hearsay they need to borrow money to come here le

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Turbocharged
3 hours ago, Mustank said:

Mean what?

mean that guy fail maths... or cannot count beyond thousands...

 

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I check his public listed competitor, still making good profits last few years. Coupled with asset fair value increase. Huat ah! Dun think S11 so lousy lah.

7657CBBC-1F9B-4616-B445-653826DC3F94.jpeg

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15 minutes ago, AT_AT1 said:

I check his public listed competitor, still making good profits last few years. Coupled with asset fair value increase. Huat ah! Dun think S11 so lousy lah.

7657CBBC-1F9B-4616-B445-653826DC3F94.jpeg

61% margin.  No wonder can have a weekend home at Sentosa.

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37 minutes ago, AT_AT1 said:

I check his public listed competitor, still making good profits last few years. Coupled with asset fair value increase. Huat ah! Dun think S11 so lousy lah.

7657CBBC-1F9B-4616-B445-653826DC3F94.jpeg

I am not an accountant. So would the "segment profit" be Gross Profit or Net Profit?

Since this is a service based (accomodations) company, I would assume it is Net Profit?

60% profit margin by the competitior for workers accomodation seems quite a bit far off from the 'razor thin' description quoted in the mothership article.  

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