Number of HDB coffee shops selling budget meals to jump 5-fold; heartland shops to pay less to upgrade store fronts

SINGAPORE — Residents in the heartlands will have more affordable meal choices at Housing and Development Board (HDB) coffee shops from May this year, with the public housing agency requiring this of coffee shop tenants as part of their rental renewal. 

This means that all 374 coffee shops rented out by HDB will each offer four budget meals and two budget drinks by 2026.

The HDB will also lower the costs that shop owners will have to fork out to upgrade their shop fronts, in a bid to add vibrancy to the heartlands. 

These initiatives were announced by Senior Minister of State for National Development, Ms Sim Ann, during the Parliamentary debate on her ministry's spending on Thursday (March 2).

She said that the initiatives were to build "an endearing home" for Singaporeans that went beyond infrastructure development.

"It is about supporting our residents with accessible and affordable amenities, preserving community ties and collective memories, and building a gracious living environment," she said.

Ms Sim said that all older coffee shops rented from HDB which are due for renewal will need to provide four budget meals and two budget drinks across two or more different stalls as a condition of their tenancy renewal as a start. 

Two of the budget meals must be rice-based and one must be halal. These coffeeshops must also offer at least two budget drinks which are black coffee (kopi-o) and black tea (teh-o).

"The budget meal and drink prices will be benchmarked against economically priced food and beverage offerings in nearby neighbourhood coffeeshops," she added.

With the extension of the requirement for budget meals, the number of HDB-rented coffeeshops offering such meals will increase from 72 currently, to 374 by 2026, said HDB in a statement on Thursday. 

There are a total of 776 coffeeshops in Singapore, of which 374 are rented out by HDB and 402 are privately-owned.

Said Ms Sim: "This will make the availability of cheaper food options in coffeeshops more certain and pervasive, as coverage of the budget meal regime will be extended to almost half of all coffeeshops and cover all HDB towns by 2026."

To ease the transition for coffeeshop operators and stall holders, HDB will offer a 5 per cent rental discount off renewal rents for a period of one year. 

Ms Sim said that the Government will also consult operators and remain flexible in assessing their proposed prices, bearing in mind their business sustainability.

Since 2018, all new HDB coffeeshops that have been let out under the Price-Quality Method tender are required to provide budget meals at six stalls, as well as one budget drink.

Price-Quality Method tenders are based on a range of criteria beyond rent alone, such as affordability considerations. 

ENHANCING VIBRANCY, COMPETITIVENESS OF HEARTLAND SHOPS

As part of the Revitalisation of Shops scheme, where the public housing agency and shop retailers share the cost to upgrade common areas and shop fronts, retailers will now be required to pay five per cent of the total cost, down from the current 20 per cent.

HDB will increase its share from 70 per cent to 85 per cent. The remaining 10 per cent of the upgrading costs will be borne by Town Councils.

The total budget for improvement works will remain at S$35,000 for each shop.

The move is to help shop owners who are hesitant to do upgrading works, especially in the face of economic uncertainty and rising costs, said Ms Sim.

Additionally, HDB will also introduce a new fund that shop owners can tap for optional works to improve their shopfront, such as installing vertical blinds, or roller shutters.

This new fund is to encourage shop owners to improve their own shopfronts in tandem with upgrading under the Revitalisation of Shops scheme.

Under the new fund for optional works, the HDB will bear 80 per cent of the costs, to a maximum of S$3,000 for each shop. Shop owners will bear the remaining cost.

Ms Sim said that HDB will shortlist sites for the scheme over the next few months before inviting local Merchants' Associations to apply. 

Priority will be given to shops that are undergoing other HDB upgrading programmes or where the Town Councils have plans for repair and redecoration works.

Older neighbourhoods that have yet to go through the scheme may also be prioritised, she added.