SINGAPORE – Several business associations have called for help in areas such as rent relief, wage support and loan moratoriums as Singapore tightens measures amid resurgence of Covid-19 infections in the community.
On Wednesday, July 21, the Alliance of Frontline Business Trade Associations described these three ways in which it seeks support to ensure the sustainability of businesses in the Retail, Food and Beverage (F&B) and services.
He called on landlords to provide rent discounts commensurate with the impact on income when the tighter restrictions are imposed. He is also seeking government salary support to help companies keep as many jobs as possible for Singaporeans.
Finally, he asked for the extension of the moratoriums on the principal of bank loans until June 2022.
The alliance’s statement came a day after Singapore announced it would return to phase two (enhanced alert) from Thursday to August 18.
Under these measures, meals in catering establishments will be banned, with operators being allowed to only offer take-out and delivery services.
The operating capacity of shopping centers will be reduced from a maximum occupancy limit of 16 m² of gross floor area per person to 10 m² per person.
A plan to support businesses and workers affected by the heightened alert phase from Thursday is in the works and details will be announced shortly, Finance Minister Lawrence Wong said in a Facebook post on Wednesday.
The alliance consists of the Association of Small and Medium Enterprises (Asme), the Restaurant Association of Singapore (RAS), the Singapore Retailers Association (SRA) and the Singapore Tenants United for Fairness (SGTUFF).
In a virtual press conference on Wednesday, SGTUFF chairman Terence Yow said there had been “very sporadic and selective help from homeowners”, and that the last significant aid had been extended l last year, when she was commissioned by the government.
“The vast majority of frontline businesses haven’t received significant owner support for our rentals, the main rental aid (is) from the government and it’s coming next month,” he said.
SAR President Andrew Kwan noted the roller coaster the restaurant and restaurant industry has gone through, with various changes in catering capacity and allocations over the past 16 months.
When asked if the latest moves could sink the industry, he said, like other sectors, many operators are at a point where their reserves are completely depleted.
“If the industry is (left) on its own, I think the reading is that many would face a shutdown, and that wouldn’t be good overall because not only does the business go down, but it carries with it all employees as well. “
Acknowledging that there have already been casualties in the industry despite various support measures given previously, Mr Kwan said that there would likely be consolidation in the industry and there was a need to develop a new business model that incorporates lessons learned over the past year and a half.
SRA Chairman R. Dhinakaran, who is managing director of fashion retailer Jay Gee Melwani Group, also called for an increase in wages through the employment support program during this next phase of increased alert, as well as exemptions from the levy on foreign workers to help cushion labor costs.
Business support for the period up to August 18 should refer to the support provided during the previous phase two (enhanced alert) period from May 16 to June 13.
Small and medium-sized businesses and nonprofits that are tenants of private commercial properties are entitled to a direct rental relief cash payment of half a month for the heightened alert period in May. The relief will be paid from mid-August.
Eligible tenants of government-owned commercial properties will receive one month of rental relief for the period May 16 through June 13.
Some large landlords, such as CapitaLand and City Developments Limited, offered various support measures during the period, including rent discounts, late rent payments and the removal of platform fees.
Affected companies also received up to 50 percent of wage support under the employment support program for the period.
Furniture retailer Scanteak, which has 11 retail stores, echoed the call for more support, noting that its business would inevitably take a hit, with footfall expected to drop during this heightened alert period.
Managing director Jamie Lim said two of his landlords provided additional rent relief during the heightened alert phase in May. But these were exceptions rather than the norm based on the experiences of most retail tenants, with most landlords choosing to see what measures the government implements, she added.
Scanteak has plans to expand its physical footprint, but those plans are currently evolving and will depend on their ability to find a suitable location at the right price, Ms Lim said.
Mr Frank Shen, co-founder of seafood bar Laut, said the owner of the unit had set aside a month for rent payment in May during the heightened alert phase.
He’s in talks with his owner and trying to see what concessions can be put in place, but the plans depend on government announcements, said Shen, who is also the co-founder of craft beer bar American Taproom.
Its establishments saw their revenues drop by about 65% during the heightened alert period in May, despite taking delivery orders.
Mr. Shen said the heightened alert phase was “killing a lot of food outlets,” which largely ensured compliance with safety distancing measures.
“Each restaurant has different concepts. For my two restaurants, we focus on bringing the experience to our diners. No matter what we do for delivery and take out, the food will never taste the same as it does on the spot; reheating doesn’t work for all foods, ”Shen said.
In a statement, owner City Developments Limited (CDL) said it will continue to support tenants as Singapore enters phase two (heightened alert), in areas such as leasing, operations and marketing.
It will also continue to provide rent restructuring for some tenants as well as rent payment flexibility for those facing serious cash flow issues, he said.
CDL said it provided targeted rental assistance to tenants, including exemptions for those who had to close and could not operate online, during the previous heightened alert phase from May to June. Almost 90% of its retail tenants have received rental assistance, he added.