Yesterday, landlords’ Lend Lease and Mapletree, who own and run four shopping malls, announced that they would have their government property tax rebate passed to their tenants.
The tax rebate of 40 percent, for owners of commercial and industrial properties, is included in the Resilience Package of $20.5 billion unveiled by the Minister of Finance on Thursday. A main component of the package is to help companies in Singapore to reduce the costs.
CapitaLand, a Government-linked landlord and the biggest in Singapore, was the first one to announce that it would pass down the rebate in full.
Australian financial and property services group Lend Lease will do the same with its 350 estimated tenants in PoMo and Parkway Parade, but refused to reveal the amount that each tenant would be receiving due to “complex calculations have yet to be made,” a spokesman said.
Mapletree, which runs HarbourFront Centre and VivoCity, will pass the tax rebate too, but declined to reveal how much and how.
Tenants under these landlords are grateful, but think how much relief this would bring.
According to Lawrence Leow, president of Association of Small and Medium Enterprises, they might receive four percent of rental adjustment at most, if landlords passed the rebate in full.
The savings that tenants will get will also be dependent on several factors like shop space demand, relationship between landlord and tenant and when was the leased signed. “It is a difficult process, and rebate amounts may even vary from tenant to tenant,” Mr. Leow said.
Some retailers are happier like Mr. Jason Ng, who manages the Swee Heng Bakery, and a tenant of the Housing Board. Among the top four who will be giving rental rebate to their tenants is the government agency. It will give 15 percent rebate from 1 January to 31 December this year. Other landlords are the Singapore Land Authority, the National Environment Agency, and JTC Corporation.
An entrepreneur, who has 12 shop spaces rented from the Housing Board, will have savings of $150,000 and up this year.
“It is the right thing at the right time,” Mr. Ng said. “Now, let us just hope private landlords follow suit.”
Landlords of private properties haven’t said yet if they will be giving other concessions on their rents, so shopkeepers are settling on what they can get for the meantime.
Small businesses feel the weight of non-negotiable rental contracts that are signed in falling sales on one hand and in good times on the other.
Finance Ministry’s figures show over 130 businesses that closed down in the previous year, a 25 percent increase compared to 2007.
“We have not received news from our landlord yet, but we are happy that they are doing this. It will be a relief in these bad times,” Miss Jean Yeo, manager of Leather Ark at Parkway Parade, said.
Charles & Keith owner Mr. Charles Wong hopes that these rebates would be done fast and be distributed fairly. “We can then immediately plough it back to help us train staff and prepare for the recovery of the economy,” Mr. Wong said.