Source: Asia Pacific Region 2 – Singapore
Singapore, 4 November 2024 – Senior Minister of State for Sustainability and the Environment, Dr Koh Poh Koon, announced at the Singapore Hawkers’ Seminar and Awards 2024 today that the National Environment Agency (NEA) will be revising the rental renewal policy for successful tenderers from the November 2024 hawker stall tender exercise onwards.
2 To deter overly high tender bids, NEA will be staggering the downward adjustment of tendered stall rentals over a longer period. Instead of an immediate full downward adjustment to the assessed market rent (AMR) at the point of first tenancy renewal, the rental for such hawker stalls will be adjusted downwards by 50% of the difference between their tendered rent and AMR for the second tenancy term. This will take effect from the next stall tender exercise in November 2024. This new measure seeks to encourage more prudent bidding behaviour.
3 To help prospective bidders make more informed tender bid price decisions, NEA will also provide more information and online business cost estimation tools to help prospective bidders make better cost and revenue estimates. These will be made available progressively from 2025.
Current Stall Tender Scheme and rental model
4 Vacant cooked food and market stalls are put up for tender monthly under NEA’s Stall Tender Scheme [1]. This open tender system ensures stalls are allocated in a fair and transparent manner. When stallholders obtain vacant stalls via the monthly stall tender exercises, their stall rental for the first tenancy term of three years is their tendered bid price. At the end of the 3-year tenancy term, stall rental is adjusted towards AMR, as determined by an independent professional valuation. The valuation considers factors such as footfall, stall sizes and tendered stall rentals at the hawker centre.
5 Currently, stallholders whose tendered rent is higher than the AMR at the point of tenancy renewal will see a full downward adjustment of their stall rental to the prevailing AMR. Stallholders whose tendered rent is lower than the AMR at the point of tenancy renewal will similarly see an upward adjustment of stall rental toward the AMR. This upward adjustment of stall rental towards AMR is moderated by NEA and has not exceeded $300 per tenancy term in recent years.
6 Popular hawker centres with high footfall and low vacancy have started to attract higher tender bids in recent years. Some bidders may have tendered high bids to secure choice stalls at their preferred locations. However, this is not the norm.
7 The median stall rental for non-subsidised cooked food stalls has remained relatively constant for the last 10 years at about $1,250 per month. Occupancy rates for cooked food stalls have remained high, averaging at around 97%. Most of the vacant stalls that are put up for tender will be occupied within three to six months.
8 While NEA does not regulate cooked food prices, we remain committed to provide a conducive environment for stallholders to operate, so that they can price their food affordably for the public and sustain their own livelihoods. Together with the Ministry of Sustainability and the Environment, we will continue to track stall rentals closely and adjust policies as necessary.
[1] Please refer to the ANNEX for an illustrated example of the Stall Tender Scheme.
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ANNEX