24 July 2020 Posted in Replies
We refer to Lin Sheng Hua’s and Lin Guan Hua’s letters (规定业主免收两个月租金不合理, 18 July; 业主与租户应共同承担租金减免, 22 July).
The rental relief framework, which will commence soon, seeks to help SMEs affected by COVID-19 with their cash flow. It provides eligible SMEs in qualifying commercial properties with rental waivers. Approximately two months’ worth of waivers (for April and May 2020) are provided through Government support to property owners, namely the Property Tax Rebate 2020 and an additional cash grant. Landlords are required to waive another two months’ rent (for June and July 2020) for their SME tenants who have suffered a drop of 35% or more in average monthly gross income at the outlet level from April to May 2020, compared to April to May 2019. For eligible SMEs in other non-residential properties (e.g. industrial or office), approximately one month of waiver (for April 2020) is provided through Government support, and landlords waive another one month (for May 2020).
Substantial support has been committed across four budgets to help SMEs through this challenging period given the critical role they play in Singapore’s economy. Landlords benefit too if businesses can continue to stay open. This helps not just the economy, but also maintains property values and rents in the long term. In this way, the rental relief framework provides a fair sharing of economic hardship between all parties – Government, landlords and tenants – all of whom have a stake in seeing our SMEs survive.
The Government recognises that there are landlords who may face genuine financial hardship. Such landlords may seek an assessment by an Assessor. If the landlord meets the grounds of financial hardship, the landlord’s portion of the rental waivers will be halved. This is essentially what Lin Guan Hua suggested. More details on the assessment for landlord’s financial hardship will be announced soon.
Credit reliefs are also available for individual and SME landlords who have to provide rental waivers but face cash flow difficulties. They may apply to defer principal and interest payments on their mortgages up to 31 December 2020, and extend their loan tenure by up to the corresponding deferment period. Those who need additional credit can apply for mortgage equity withdrawal loans, or loans under Enterprise Singapore’s Temporary Bridging Loan Programme or Working Capital Loan Scheme.
Through such support to both tenants and landlords, we hope to preserve as many businesses as possible, and come through this crisis together.
Director, Corporate Communications Division
Ministry of Law
Last updated on 24 July 2020