{"id":13488,"date":"2025-06-18T10:18:23","date_gmt":"2025-06-18T02:18:23","guid":{"rendered":"https:\/\/dollarsandsense.sg\/business\/?p=13488"},"modified":"2025-06-18T11:20:25","modified_gmt":"2025-06-18T03:20:25","slug":"rent-control-commercial-property-cooling-measures-residential-property","status":"publish","type":"post","link":"https:\/\/dollarsandsense.sg\/business\/rent-control-commercial-property-cooling-measures-residential-property\/","title":{"rendered":"Why “Rent Control” Should Be Introduced For Commercial Property (Like Cooling Measures For Residential Property)"},"content":{"rendered":"\n

In recent weeks, rent-related headlines have been in Singapore\u2019s news cycle. For example, Flor Patisserie, a Japanese-style bakery in Siglap, announced its closure due to rising rental costs<\/a>. Their landlord allegedly increased rents 57% – from $5,700 to $8,500 per month. <\/p>\n\n\n\n

Around the same time, a clinic in Tampines secured its lease at an eye-catching $52,188 per month. Health Minister Ong Ye Kung said he was \u201cdismayed at the monthly rental bid,\u201d noting in a Facebook post<\/a> that it \u201cmust translate to higher cost of healthcare one way or another.\u201d.<\/p>\n\n\n\n

These are just two stories that have surfaced recently, but the issue of high rents in Singapore is nothing new. Businesses have always had to deal with rents, along with other costs such as manpower, raw materials, supplies and other costs.<\/p>\n\n\n\n

Read Also: $52,188 A Month For A GP Clinic In Tampines. Should The Government Be Worried?<\/a><\/em><\/strong><\/p>\n\n\n\n

Small Local Brands Bear The Brunt Of Rent Hikes<\/strong><\/h3>\n\n\n\n

If you frequently walk around malls and shopping districts, you may notice how often shops close down and new ones take over. Smaller brands or caf\u00e9s shut, only to be replaced weeks later by a franchise or international brand. The reason often isn\u2019t just bad business – it\u2019s also rent hikes.<\/p>\n\n\n\n

Small and micro businesses in Singapore, unlike well-funded chains and global brands, operate within thinner margins. As rents climb, it becomes harder for homegrown businesses to survive. Many are forced to relocate, downsize, or exit the business entirely. <\/p>\n\n\n\n

Meanwhile, established international brands that have scale, global presence, and larger marketing budgets, can absorb these costs without immediately raising prices or face cashflow pressures. They are used to rent hikes and often have the flexibility to implement long-term business strategies to manage their costs.<\/p>\n\n\n\n

This can become a vicious cycle though – eroding local brands and diminishing the diversity of Singapore\u2019s commercial landscape. Whether you\u2019re in Siglap, Tampines, Orchard, or Jurong, malls begin to feel the same: the same fast-food outlets, supermarket anchors, wellness chains, and fashion franchises.<\/p>\n\n\n\n

Without room to grow, many Singapore businesses may close down before ever having the chance to mature into household names with the scale, strategy, and resilience to eventually weather rent hikes.<\/p>\n\n\n\n

As a whole, Singapore and those living here may not be better off if every mall in Singapore becomes a carbon copy of the next. While standardisation can bring convenience and efficiency for the brands, landlords and consumers, it risks wiping out entire categories of businesses – niche bookstores, artisan bakeries, family-run clinics, music schools, and cultural retailers – that simply cannot afford to pay for the same space, especially in their early years.<\/p>\n\n\n\n

Read Also: Rent Hikes: Why Landlords Are Not Always To Blame<\/a><\/em><\/strong><\/p>\n\n\n\n

Lessons From Residential Property Measures<\/strong><\/h3>\n\n\n\n

To understand why commercial rent control might make sense, we can look at how Singapore has managed the residential property market.<\/p>\n\n\n\n

Over the years, the government has implemented multiple cooling measures to prevent housing from becoming unaffordable or overly speculative. These include the Additional Buyer\u2019s Stamp Duty (ABSD)<\/strong>, Loan-to-Value (LTV) limits<\/strong>, Total Debt Servicing Ratio (TDSR)<\/strong>, a 15-month wait-out period for private property owners<\/strong> to buy HDB flats, and more.<\/p>\n\n\n\n

These measures weren\u2019t only about controlling prices. They were about protecting Singaporeans\u2019 access to housing. Some markets are too important to be left entirely to market forces.<\/p>\n\n\n\n

Whether commercial rents fall into that category is a question only the government can answer.<\/p>\n\n\n\n

Read Also: A History Of Property Cooling Measures In Singapore Over The Years<\/a><\/em><\/strong><\/p>\n\n\n\n

Should Commercial Rents Be Any Different?<\/strong><\/h3>\n\n\n\n

There are good reasons why intervening in commercial rents could benefit not just business owners, but Singapore as a whole:<\/p>\n\n\n\n

#1 Higher Rents Mean Higher Consumer Prices<\/strong><\/h4>\n\n\n\n

Businesses aren\u2019t charities. When costs go up, they\u2019re passed on to consumers. Whether it\u2019s a meal, a haircut, or a doctor\u2019s consultation, rising rents eventually translate into higher prices for everyday Singaporeans.<\/p>\n\n\n\n

Even though larger international chains may absorb higher rents in the shorter-term, the costs will ultimately trickle down to consumers over time.<\/p>\n\n\n\n

#2 It Affects Wages, Job Security, And Work Stress<\/strong><\/h4>\n\n\n\n

When rent becomes a dominant business expense, there\u2019s less left for salaries or hiring. In service-based sectors like F&B and retail, this can lead to slower wage growth and reduced headcount – resulting in even more work stress. <\/p>\n\n\n\n

Worse still, steep rent hikes can lead to sudden shop closures, and with it, sudden job losses.<\/p>\n\n\n\n

#3 Entrepreneurship And Innovation Will Take A Hit<\/strong><\/h4>\n\n\n\n

Start-ups and SMEs comprise 99% of all business entities in Singapore and employ 70% of the workforce<\/a>. They are the lifeblood of innovation and require time and space to grow. In an environment where affordability is a constant struggle, creative or unconventional ventures have little chance of surviving. <\/p>\n\n\n\n

We risk fostering a climate where only well-capitalised, established brands can make it – limiting the potential for new ideas and local champions.<\/p>\n\n\n\n

But, Local Businesses Are Not The Same As Local Families<\/strong><\/h3>\n\n\n\n

Of course, it\u2019s important to acknowledge a key difference. Businesses, unlike families, are expected to manage risk and were created to earn profits. In some markets, the saying \u201conly the fittest survive\u201d holds true.<\/p>\n\n\n\n

Protecting small businesses from rent hikes may simply increase their owners\u2019 profits. It doesn\u2019t guarantee that cost savings will be passed on to customers or shared with employees.<\/p>\n\n\n\n

If small businesses deserve protection, what about their employees? And what about landlords, who are also businesses and may have struggles of their own to pay down property loans or renovation loans? Who will protect them? Where will the protection end?<\/p>\n\n\n\n

Ultimately, if another business can afford to pay higher rent, should protectionist policies intervene to save a business that cannot compete in the market?<\/p>\n\n\n\n

Even if that is so, the government cannot protect every business.<\/p>\n\n\n\n

That\u2019s why housing receives more direct support. We can afford to see a small business close and restart. But we cannot afford to see a family lose their home and end up on the streets.<\/p>\n\n\n\n

Even in the housing market, private property rents are not controlled. To some degree, we accept that those renting a condominium are in a better position to fend for themselves. They can always consider renting an HDB flat or buying a home within their means.<\/p>\n\n\n\n

Similarly, business owners who cannot cut it as business owners may need to consider employment?<\/p>\n\n\n\n

At the end of the day, acknowledging the differences between businesses and families doesn\u2019t mean we should ignore the real-world consequences of runaway commercial rents too. They can have major implications on our economy, workforce, society, and long-term resilience.<\/p>\n\n\n\n

From public housing and car ownership to retirement planning and urban design, Singapore has never relied solely on free-market forces. The question is not whether intervention is necessary – but whether commercial rents have reached a point where doing nothing is the bigger risk.<\/p>\n\n\n\n

Read Also: Rethinking Fairness In F&B: Why The Home Cafe Debate Is Really About Policy<\/a><\/em><\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"Should businesses be protected?\n","protected":false},"author":10,"featured_media":13490,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":[],"categories":[364],"tags":[104,2269,290,1829],"yoast_head":"\nWhy "Rent Control" Should Be Introduced For Commercial Property (Like Cooling Measures For Residential Property) | DollarsAndSense Business<\/title>\n<meta name=\"description\" content=\"Rising commercial rents in Singapore are putting pressure on small local businesses and consumers alike. 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