Find out what rental relief is available for office tenants, and if you are eligible
There has been much written about Covid-19 rental relief measures offered by the Government in the hard hit retail sector, but there is less information about what reliefs are available in the industrial/office sector. It is important to distinguish between the two sectors because the relief available in the commercial sector (i.e. retail) is greater than the relief available in the industrial/office sector.
Initially, there was very little on offer to office users and was limited to just a waiver or refund of property tax, paid through monthly rent payments, which amounted to 36% of one month’s rent. Subsequently, the Government offered to provide cash grants to SMEs, equivalent to 64% of one month’s rent. Along with the property tax relief, this brings the total relief amount to one full month, and this is to be applied for the month of April 2020.
In addition to this, landlords are to provide further relief to tenants, who can show there has been a significant drop in their average monthly revenue due to Covid-19. This will be in the form of an additional rental waiver, equivalent to one month’s base rent, excluding service charge (see below for what constitutes a substantial drop in revenue). This is to be applied for the month of May 2020.
Eligibility of Tenants – the following conditions apply:
- Tenant must be an SME, which is defined as one having an annual turnover of less than or equal to S$100M.
- Definition of a substantial drop in revenue during Covid-19 – this is where the average monthly revenue from April 2020 to May 2020 has been reduced by 35% or more, compared with the same period in 2019.
- The tenancy must have been entered into before 25th March 2020.
- Note that subtenants are also entitled to the same reliefs.
For more information please visit:
https://www.mlaw.gov.sg/covid19-relief/rental-relief-framework-for-smes
