TENDER FOR FOOD COURT AT SERANGOON CENTRAL WET MARKET

Mr Goh Choon Kang asked the Minister for National Development why the Housing and Development Board has not been able to attract successful tender for the space for a food court at the Serangoon Central Wet Market after one year.

The Minister for National Development (Mr Lim Hng Kiang): Mr Speaker, Sir, besides the Serangoon Central Wet Market, the three storey building also included four retail units, one of which is designated as a food court.

HDB has so far let out three of the four retail units for use as a fast food restaurant, a departmental store and a family amusement centre. For the remaining food court unit, HDB has completed many rounds of tender exercises but has found very few demand for the unit. No tenant has been found so far. This shows that the eight other eating establishments currently operating in Serangoon Town Centre and the private sector eating outlets in Serangoon are sufficient to meet the needs of the residents. The latest tender exercise for this unit is currently in progress and will close at the end of the month. If this latest tender exercise is unsuccessful, the HDB will let out the unit for other uses.

Mr Goh Choon Kang: Does the Minister agree that this space was not able to be tendered out because the minimum reserve price is too high?

Mr Lim Hng Kiang: Mr Speaker, Sir, as is the present practice, all tenders put out have a minimum reserve price. For the six tender exercises which were completed, there were either no tender bids at all or one or two tender bids which came below HDB's reserve tender price. For example, the latest tender, the sixth tender, managed to attract only one bid. This is obviously not a competitive tender and therefore it was not awarded.

Mr Goh Choon Kang: Sir, I would like to ask the Minister whether HDB should consider lowering the reserve tender price in order to have a successful tender, rather than leave the space there vacant for so long?

Mr Lim Hng Kiang: As I replied earlier, the space will not be left vacant. If this latest tender does not show a good result, we will let it out for other uses.

Mr J. B. Jeyaretnam (Non-Constituency Member): May I ask how does the HDB arrive at this reserve price?

Mr Lim Hng Kiang: The current Government practice on tender goes something like this. On the date and time of the closing of the tender, the Chief Valuer or the Valuation Officer of HDB will submit a bid considering the market evidence of what would be the going market price. So the Government agency evaluating the tender and the person making the evaluation are two separate bodies. In a Government tender, whoever is the agency, HDB or URA, will close the tender on a particular date and time. At that date and time, the Chief Valuer participates in the tender just like any other private sector agency. The Chief Valuer will put in a tender bid stating what he determines to be the reserve price, evaluating the market evidence. Similarly for HDB tenders, the same practice is done. The Commercial Property Section runs the tender, but the Valuation Officer in HDB is a separate agency that will put in a reserve bid.

Mr Jeyaretnam: May I ask whether only market forces are taken into consideration or whether the needs of the community around there are considered?

Mr Lim Hng Kiang: As the evidence shows, there are enough eating outlets in the Serangoon Road area. Serangoon Road is not an isolated HDB town. It is built close to existing food outlets. There are also food outlets within the Town Centre. So obviously there are enough food outlets and the needs of the residents are met.