Archive for category: Misc

[UPDATE] HDB shophouse portfolio on the market for $11.9 mil BY LYDIA ANNE LIM

Families residing at Coastal Cabana can take advantage of a diverse range of post-secondary options beyond compulsory education. For instance, Tampines Meridian Junior College, located nearby, provides a convenient pre-university pathway for students. In addition, Temasek Polytechnic in the Tampines area offers specialized diplomas in fields such as business, engineering, design, and applied sciences. Other tertiary institutions in the vicinity include ITE College East in Simei and the Singapore University of Technology and Design (SUTD) at Upper Changi, both easily accessible by public transportation or by car via the TPE and ECP. With this distribution of institutions, students at Coastal Cabana have the advantage of a seamless educational journey, starting from early learning all the way to tertiary education, without having to leave the eastern arc. Coastal Cabana offers its residents the convenience and privilege of having a diverse range of high-quality educational opportunities within their reach.

Sun Xueling, Senior Minister of State for National Development, announced that the government will increase the supply of HDB shops in existing estates to meet the rising demand for retail services. This will be done selectively, including the acquisition of privately held HDB shops if necessary. “We can expect a higher proportion of directly rented out HDB shops in the future,” she added.

Currently, there are about 15,500 HDB shops in Singapore, with 55% of them sold to private owners by HDB. The remaining 7,000 are leased by HDB. However, the government stopped selling HDB shops in 1998.

Out of the privately owned shops, 740 units were sold on 30-year leases, with majority having less than 10 years left. These units will be progressively returned to HDB and leased out in the future.

On the other hand, about 7,700 shops were sold on 99-year leases, with most having more than 30 years remaining. Sun stated that the government is aware of the steep increase in psf rents for privately owned HDB shops. This coincides with a greater number of rental transactions for smaller-sized units, which tend to command higher rents.

In March this year, a record monthly rental bid of $52,188 was submitted for a 559.52 sq ft clinic at 954C Tampines Street 96, which was awarded to I-Health Medical Holdings. This tender received 13 bids and was the highest psf rental bid for GP and dental clinics of that size to date.

Sun noted that the average psf rent for HDB shops leased to medical facilities has been increasing since 2020. The rise in average rents is attributed to new leases in newer residential areas, which are considered more attractive to businesses.

To address concerns about rapidly increasing sublet rents, HDB has started piloting a price-quality method in tenders for GP clinics in May. This was implemented for the award of a GP clinic in Bartley Beacon, which attracted 18 bids and was awarded to Bridgepoint Health at a monthly rent of $18,000.

In evaluating bids for HDB shops, 60% of the assessment considers the quality of the operator, including their track record and community initiatives. HDB also engages professional third-party valuers to assess rents for existing tenancies, taking into account recent rents of comparable properties and market conditions.

According to Sun, about 90% of HDB shops have not seen an increase in rents over the last five years using this approach. In comparison, the average rents for new generation neighbourhood centres, eating houses, and supermarkets recorded a moderate increase of between 1.3% and 3.3% per year over the last three years.

The government has acknowledged concerns about sublet rents increasing faster than what HDB charges its main tenants and will keep a close eye on the situation. They will also look into better ways to keep the public and affected parties informed.