On 5 April 2021, Singapore entered into a semi-normal state of daily living with safe distancing measures significantly eased. Since then, things have taken a turn for the worse – initially reverting back to Phase 2 measures in just over a month from 8 May 2021.
Dubbed “round 2 of Phase 2”, this was set to last for about 3 weeks until 30 May 2021. However, as more virulent strains of COVID-19 were found and significantly higher community cases surfacing, the government again announce further tightening measures on 14 May – taking us into a quasi-Phase 1 environment – from 16 May to 13 June 2021.
We look at some of the biggest losers because of this latest announcement to tighten safe management measures.
#1 Food & Beverage Outlets
According to the latest “heightened alert” measures announced by the Ministry of Health (MOH), dine-in options for F&B outlets will have to cease between 16 May to 13 June 2021. This will be another big blow to the F&B sector, which was likely just starting to get back on its feet.
Underscoring just how much the sector will suffer, the F&B sector was also the only sector that the government extended a 50% enhanced salary support for the duration under the Jobs Support Scheme (JSS), an increase from 10% it would have received normally.
While the government will be supporting hawkers and coffeeshop stallholders with a one-month rental relief on government-owned premises, this is not mandated for private-owned properties leased to F&B establishments.
#2 Gyms And Fitness Studios
Gyms and fitness studio owners may have felt hard done by when majority of them were to close during the initial tightening measures into “round 2 of phase 2” announced on 4 May 2021.
In this latest round of tightening measures, it is mentioned that “no streneous physical activities should take place in any indoor space regardless of size”. However, it then also mentions that if the activitiy is “high intensity” where masks have to be removed, only 2 persons are allowed, including the coach or instructor). There can be no multiple groups of 2.
While “less strenuous” forms of indoor activities can still continue, such facilities will have to adhere to the reduction in group sizes from 5 to 2. Masks must also be on at all times. Indoor high-risk environments, such as indoor and private gyms and fitness/exercise/ dance studios are to be shut. No facilities should offer weights, strength or resistance training or provide equipment associated with strenuous activities.
For larger facilities, they can only admit persons according to its Gross Floor Area – based on 16 spq per person – up to 50 persons. Group must be kept to 2 individuals. No facilities can admit more than 50 persons.
For programmes or classes indoors, multiple groups of 2 can participate, but must remain 3 metres apart. Up to 30 participants in allowed, or up to the capacity of the venue (up to 50 persons). A coach or instructor is permitted.
#3 Office And Retail Property Landlords
As work-from-home has reverted to be the default work arrangement again, businesses with office space are going to think twice (or thrice or many more times) before committing to an office space for the foreseeable future. Those already stuck in a lease will be rethinking their lease negotiations when they are up in the future.
Similarly, retail property owners are affected as safe distancing measures get tightened and more importantly, COVID-19 remains elusive to containment measures. For now, occupancy limits for malls will be further reduced from 10 sqm per person to 16 sqm per person. Odd and even date entry restrictions will also continue.
The extend of how much office and retail property owners will suffer is reflected in their stock price performance – CapitaLand Integrated Commercial Trust, one of the biggest mall operators in Singapore has seen their share price dip over 7% in a 2-week period in May. Similarly, other retail and office REITs are experiencing a poor performance.
#4 Retail Shop Owners
Obviously, as retail property owners suffer, so will their smaller brethren – the retail shop owners. These smaller players may suffer even more as they would not have as deep pockets as the property owners.
Furthermore, as mall capacities are capped and with group sizes shrunk to just two people, retail shop owners may see an equally drastic drop in their in-store purchases. Unlike F&B businesses though, retailers will not be afforded any rental relief or JSS support.
Nevertheless, they are allowed to remain open and have customers in their store.
Cinemas have not had it easy since the start of COVID-19. Unfortunately, just when there was light at the end of the tunnel, Singapore is reverting to more stringent safe management measures again.
Currently, only 50 people are allowed into cinemas in groups of twos. Food and beverage also cannot be served or consumed in cinemas. With pre-event testing, up to 100 persons may be allowed into cinema halls.
#6 New Companies That Just Started Up
For new companies that just started up, this may also be a very trying period. On top of not having a regular base of customers to fall back on, many grants being disbursed by the government require companies to have longer track records.
For example, the recently enhanced Sports Resilience Package that provides a Sports and Fitness Operating Grant of between $5,000 to $100,000, require businesses to have received the JSS support. This means businesses need to have been in existence for more than one and a half years or so.
#7 Event companies
Just when event companies were starting to get a glimmer of hope – with safe management measures eased in early April, we’re back into “Heightened Alert”.
During 16 May to 13 June, only up to 100 persons may be allowed into event space with pre-event testing, and up to 50 attendees without pre-event testing.
No unmasking will be allowed for speakers or performers, making it less likely anyone would want to hold events that can be pushed back.
Furthermore, wedding receptions will also not be allowed to take place, in line with dine-in restrictions for F&B companies. Solemnisations can continue with new restricted measures.
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