HOUSING AND DEVELOPMENT BOARD SHOP TENANTS

Dr Teo Ho Pin asked the Minister for National Development (a) how many Housing and Development Board (HDB) shop tenants terminated their leases in 1996, 1997 and 1998; and (b) whether the HDB will consider further reducing the rental of HDB shops so as to enable shop tenants to lower the prices of their goods and services, thus benefiting consumers.

Mr Lim Hng Kiang: A total of 146,217 and 158 shop tenants terminated their tenancies in 1996, 1997 and 1998 (up to August 1998) respectively. These figures do not include those affected by redevelopment/clearance programmes.

With about two-thirds of the shops eligible for sale already sold, the market rentals for HDB shops are largely determined by the shop owners and their tenants. HDB is no longer the main deciding factor for shop rentals. In reviewing market evidence of the going rent, HDB follows the market trend and does not lead it.

To help shopkeepers during this period of economic slowdown, HDB has introduced a package of rent concessions in November 1996 and December 1997, eg, moderating rental adjustments at 3rd renewal, granting up to 10% rental concession for those paying above market rent and staggering increases in rent for subletting and assignment cases. In July 1998, additional concessions in the form of 10% rental rebates and passing on of the full savings of 55% property tax rebates, were introduced for a period of one year, from 1st July 1998 to 30th June 1999.

Thus, various measures have already been implemented to help shop tenants reduce business costs. Nevertheless, HDB will monitor the market rent closely and make adjustments as and when necessary.