HDB SUBLETTING FEE STRUCTURE

Mr Chew Heng Ching asked the Minister for National Development whether the Housing and Development Board will review its subletting fee structure on its leased premises in view of the deteriorating economic conditions.

Mr Lim Hng Kiang: HDB allows subletting of its leased commercial and industrial premises. In the case of commercial premises, no subletting fee is charged. Instead, lessees have to pay an administrative fee of $200 for the processing of the application to sublet the premises.

In the case of subletting of HDB leased industrial premises, which are mainly industrial land leases, HDB charges a subletting consent fee, except in cases where the subtenants are wholly-owned subsidiaries of the lessees. This is because HDB's industrial land is not tendered out to the highest bidder, but is allocated to deserving industries, with the support of the EDB. The industrial land is intended for the industrialists' own manufacturing activities. Thus, it is reasonable to impose a subletting consent fee to ensure that the premises is essentially owner-occupied. HDB's subletting fee structure is similar to that used by JTC. Under this structure, the minimum subletting fee is $1,000 per annum. So far, about 37% or 200 of HDB's industrial lessees have sublet their excess space to unrelated companies.

JTC has recently reviewed its subletting fee structure which will benefit new subletting cases as well as renewals. Essentially, the subletting fee will be moderated depending on the plot ratio of factory development (ie. the higher the plot ratio, the lower will be the new subletting fee compared to the current fee). The minimum subletting fee will also be reduced from $1,000 per annum to $500 per annum. HDB will, similarly, be reviewing its fee structure to be consistent with JTC.