SINGAPORE: The Restaurant Association of Singapore (RAS) said on Monday (Mar 2)that it is “deeply disappointed” with landlords for not following through with their earlier announcements of rental rebates for tenants.
Many food and beverage (F&B) businesses “have yet to receive any offers or confirmation” of these rebates, while some tenants received less than what was promised, RAS said in a statement to the media.
Apart from four landlords – Jewel Changi, Changi Airport Group, JTC and NParks – which have sent written notices on rental rebates to their tenants, “all other landlords and mall owners have been slow to react”, said the association.
“We are deeply disappointed in the landlords’ lack of follow through in spite of public announcements of support for the industry during this crisis,” said RAS executive director Edwin Fong.
The F&B sector is among those that have taken a hard hit from the COVID-19 outbreak, as tourists stay away and locals avoid public places.
With some operators expecting revenue to fall as much as 80 per cent over the next three months, the RAS on Feb 13 appealed to 24 major landlords in Singapore to help tenants cope with the situation by giving them a 50 per cent rental rebate for three months.
It also highlighted how Jewel Changi Airport had taken the initiative to offer its F&B and retail tenants a 50 per cent rebate on fixed rent for February and March, and hoped more landlords would follow suit.
Less than a week after RAS' appeal, Deputy Prime Minister Heng Swee Keat announced in his Budget speech that landlords of private commercial properties would be granted a 15 per cent property tax rebate. The rebate was part of a special S$4 billion package to help businesses affected by COVID-19, and Mr Heng urged landlords to pass the savings on to their tenants by reducing rents.
Since then, several major landlords have announced measures pledging to do so, including CapitaLand.
The SGX-listed property giant has said it would release one month’s worth of security deposits to offset rental payments for the month of March, as well as other forms of support such as flexible rental payments and a one-time rental rebate of up to half a month for eligible tenants.
During a meeting with RAS on Feb 21, which was also attended by representatives of Enterprise Singapore and the Singapore Retailers Association, CapitaLand had also promised rental rebates of 50 per cent for its F&B tenants.
However, this has yet to be fulfilled, RAS said in its statement on Monday.
Several F&B operators in CapitaLand’s urban malls have said that they have only been offered rebates of 10 per cent, while those at Clarke Quay have been offered 15 per cent, RAS said.
For those operating in CapitaLand’s suburban malls, “no rental rebates have been granted”, it added.
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The association said many F&B outlets, especially those run by smaller operators, have “an urgent need for assistance” with cash flow and other uncertainties brought on by the COVID-19 situation.
It remains “hopeful that the landlords will honour their word” in rolling out rental rebates, noting that they have to "fulfil their role as partners in helping the F&B industry save jobs and secure the livelihood of our employees".
In response to queries from CNA, CapitaLand said that it remains committed to implementing its support package for tenants and that it is “unfortunate that the entire relief package has not been fully comprehended by RAS” despite ongoing engagements.
It is in the process of reviewing its portfolio of 3,500 leases and aims to complete this by the end of March.
“By which time, tenants will be informed of their respective rental relief packages,” said Mr Jason Leow, president of CapitaLand Singapore and International, adding that rental relief will be given in a “targeted manner”.
For now, apart from informing tenants that rents for March will be offset against a month of their security deposits, CapitaLand has also granted rental rebates of 20 per cent to 30 per cent over two months to eligible tenants in its downtown malls, which have been more affected by the virus outbreak.
“We will continue to engage our tenants closely and stand prepared to do more should the situation requires,” said Mr Leow, noting that the group’s various promotions since Feb 14 have shown “positive results in bringing customers back” to its malls.
Frasers Property Retail, which announced a support package last week that includes reduced atrium rental rates and options for retailers to operate for shorter hours, said it will pass on the 15 per cent property tax rebate to all qualifying businesses across its retail portfolio.
Asked for details on how it plans to do so, a spokesperson told CNA on Monday: “The property tax rebates, which will be passed on to qualifying tenants over the next two weeks, precedes the release of funds from the government.
“We will also be reaching out to our tenants to assist them in converting security deposits paid in cash to banker’s guarantees.”
The spokesperson added that Frasers Property Retail will consider rolling out additional support, such as rental reliefs, to its tenants should the situation worsen.
Lendlease Singapore and Perennial Real Estate have also pledged to pass on the property tax rebates to tenants.
“We will assess each of their concerns and work out the best way to support them, such as in the form of flexible payment schemes,” said Lendlease Singapore’s head of asset operations Jenny Khoo.
A Perennial spokesperson told CNA that at the moment, landlords have no clarity on whether their properties qualify for the tax rebate, particularly for integrated developments that have both office and retail components.
“We understand that firm details will only be provided to landlords in April 2020. Regardless, we are committed to pass on the full rebate to qualifying tenants and they have all been informed,” added the spokesperson in an emailed response.
Perennial said it is monitoring the sales of its tenants “closely” and is prepared to top up further rebates to support those that are harder hit by the virus outbreak.