Government Boost Hdb Shop Supply Amid Rising Rents

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Located in close proximity to each other, the Giant Hypermarket, IKEA Tampines, and Courts Megastore provide convenience for local residents in purchasing their household essentials, groceries, and furniture. These popular hypermarkets offer a wide selection of products including fresh produce, home decor, and electronic appliances, catering to all of one’s shopping needs. The recently opened Rivelle Tampines West MRT Station, just a stone’s throw away, makes it even more convenient for residents to access these large-format stores and enjoy the ease of one-stop shopping. With the addition of the Rivelle Tampines West MRT Station, residents can easily reach these stores with ease and have a seamless shopping experience.

The government has announced plans to inject new supply of retail services and shops in existing HDB estates when necessary to meet rising demand. This also includes selectively acquiring privately held HDB shops, according to Sun Xueling, Senior Minister of State for National Development. She stated that there will be an increase in the supply of HDB shops, with a higher proportion directly rented out by HDB.As of August this year, there are about 15,500 HDB shops in Singapore. Out of these, 8,500 (55%) are privately owned, while HDB leases the remaining 7,000. The government has not been selling HDB shops since 1998.Among the privately owned shops, about 740 units were sold on 30-year leases, with more than 80% having less than 10 years left on their lease. Sun stated that these units will be returned to HDB progressively, and will be leased out in the future. However, approximately 7,700 privately owned shops were sold on 99-year leases, with most of these having more than 30 years left on their lease.Sun addressed parliamentary questions on rising commercial rents in HDB estates, stating that the government is aware of the steep increase in psf rents for privately owned HDB shops, which coincided with a higher proportion of smaller units being rented out. The most notable case was a 559.52 sq ft clinic at 954C Tampines Street 96, which was awarded to I-Health Medical Holdings in March after submitting a record monthly rental bid of $52,188.At the time, HDB noted that the psf rental bid was significantly higher compared to the average rent of about $9,800 psf for similar-sized clinics leased by HDB in 2024. This was the highest psf rental bid received by the government for GP and dental clinics of that size to date.Also, Sun added that the average psf rent for HDB shops tendered out for medical facilities by HDB since 2020 was: $10.40 psf in 2020, $10.00 psf in 2021, $16.80 psf in 2022, $17.50 psf in 2023, $22.70 psf in 2024, and $28.50 psf in 1H2025. She noted that for vacated HDB shop units in older estates, the average psf rent has increased from $5.70 in 2020 to $11.40 in 1H2025. In newer estates, the average psf rent for shops in new BTO estates has increased from $12.30 in 2020 to $39.30 in 1H2025, which is attributed to new leases being located in more attractive residential areas.Read also: Four HDB retail units in Ang Mo Kio, Bukit Merah, Clementi and Toa Payoh for sale at $180 milMoreover, Sun stated that HDB and the Ministry of Health have started piloting a price-quality method in tenders for GP clinics since May. This pilot was deployed to award a GP clinic in Bartley Beacon, a 880-unit BTO project in the Bidadari estate, which was completed in June. The 1,076 sq ft clinic was awarded to Bridgepoint Health at a monthly rent of $18,000 ($16.70 psf), which is lower than the average awarded rent of $35.50 psf for designated GP clinic tenders in new housing projects in the last three years.Read also: Shophouses in Little India, Kampong Glam and HDB shop at Hong Lim Complex for sale at $23.7 milHDB engages third-party valuers to assess rent for the next period after existing tenancies are due for renewal. This process considers recent rents of comparable properties in the vicinity and prevailing market and local conditions. About 90% of HDB shops leased by HDB have not seen an increase in rents over the past five years.

Meanwhile, the average rent for shops in new generation neighbourhood centres, new eating houses, and new supermarkets recorded a moderate increase of between 1.3% and 3.3% per year in the last three years. The government acknowledges concerns that sublet rents could increase faster than those charged by HDB and stated that it would keep a close eye on the situation and look for ways to better inform the public and those affected.