Introducing Rent Control Legislation for Renting of Eating Houses in Mature Estates
Ministry of National DevelopmentSpeakers
Summary
This question concerns Mr Murali Pillai’s inquiry on whether the Government will implement rent control legislation for eating houses in mature estates as HDB now rents instead of sells new shops. Minister for National Development Desmond Lee responded that food affordability is maintained through a steady supply of coffee shops and the use of Price-Quality tenders to ensure sustainable rentals. He noted that while HDB has only rented out shops since 1998, 30 more coffee shops and several hawker centres are being developed to ensure healthy competition and affordable options. Regarding rent control, Minister for National Development Desmond Lee cautioned that such measures could inadvertently discourage owners from upgrading their facilities and services for the benefit of residents. He concluded that HDB will continue monitoring resale market transactions and food prices, remaining prepared to review policies to address affordability concerns and ensure access to affordable food.
Transcript
28 Mr Murali Pillai asked the Minister for National Development as a consequence of HDB's decision to rent out new eating houses instead of selling them, whether the Government will introduce rent control legislation for the benefit of stallholders in eating houses at mature estates that continue to be the subject of sale transactions.
Mr Desmond Lee: There are, presently, over 770 HDB coffee shops in Singapore. Some of these coffee shops are sold and are, hence, privately-owned, while the rest are rented out by HDB.
We are mindful of the need to ensure that residents have access to affordable cooked food options and of the potential impact of resale transactions and have, therefore, put in place various measures over the years. One key measure is to ensure a good supply of coffee shops in every HDB estate and town, so that there is healthy competition. These coffee shops can also be run by social enterprises, for example, NTUC Foodfare, to help keep food prices low.
The market for F&B is highly competitive, especially in our heartlands. For example, the two coffee shops in Tampines and Yishun are within neighbourhood centres that have five and seven coffee shops respectively within a 400-metre radius and residents, hence, have a choice of affordable food options there.
HDB completed 34 new coffee shops in the last four years and continues to build new ones to serve new HDB developments. Another 30 coffee shops will be completed in the next four years. Aside from coffee shops, we also have over a hundred hawker centres in Singapore and the Government is building more. Four new centres will begin operations this year, with another seven being planned or under construction.
Since 1998, HDB no longer sells coffee shops and only rents them out. In addition, HDB has introduced new measures to ensure quality and affordability of food in these coffee shops that are rented out. In 2018, HDB introduced Price-Quality tenders, with 50% of points assigned to the Quality of the operator, which includes aspects, such as the availability of budget meals, good track record and community initiatives. Operators who successfully tender for HDB coffee shops, typically, provide budget food options at every stall, with these priced at around $3. The rentals under Price-Quality tenders are also lower and more sustainable than under pure price bidding tenders.
We note the suggestion from the Member on possible rent control measures. We will need to guard against unintended impacts. For example, by controlling rent, we could end up reducing the incentive for coffee shop owners to invest in improving their coffee shops to provide better services and facilities to customers.
Coffee shops and food centres play an important social role in our HDB towns and estates, as they not only provide a convenient option for cooked food and drinks for residents, but also serve as key community hubs for families and friends to bond and connect over food and drinks.
As such, HDB regularly monitors the resale market for HDB coffee shops, as well as the prices of food sold in both sold and rental coffee shops and will not hesitate to review its policies to address affordability concerns where necessary.