HDB Shops to Require Six-Year Rent Commitment from Bidders

Successful bidders for new shops under the Housing and Development Board (HDB) in Singapore must now commit to a six-year rental agreement, an increase from the previous three-year term. This change aims to promote more prudent bidding practices among tenderers, according to a media release from HDB on January 10, 2024.

The decision to extend the rental commitment comes in response to rising rental bids within HDB estates. Notably, a record monthly bid of S$52,000 was submitted for a ground floor unit at Block 954C Tampines Street 96 by I-Health Medical Holdings. This amount marked the highest per square foot rent received by HDB for general practitioner (GP) and dental clinics of this size, as reported by HDB in June 2023.

Previously, when a three-year tenancy was due for renewal, HDB would engage professional valuers to assess the rent for the next tenancy period. This process aimed to stabilize rental rates by considering “recent rents of comparable premises in the vicinity, as well as prevailing market and local conditions,” stated the Ministry of National Development (MND) in a parliamentary response last September.

Despite fluctuations in the rental market, MND noted that rental rates for approximately 90 percent of HDB rental shops remained unchanged over the past five years, reflecting a degree of stability in the sector.

As of August 2025, Singapore is home to around 15,500 HDB shops, with roughly 7,000 under HDB’s management and about 8,500 privately owned. HDB ceased selling shops in 1998, opting instead to rent them out directly to businesses. The rental rates for privately owned HDB shops are dictated by the owners, and MND acknowledged a significant increase in per square foot rents for these properties.

Among the privately owned shops, approximately 740 are subject to 30-year leases, with over 80 percent having less than ten years remaining. These shops are expected to be gradually returned to HDB for rental. The remaining privately held HDB shops, totaling around 7,700, have been sold on 99-year leases and typically have over 30 years left.

In light of ongoing demand, HDB announced plans to continue providing new shops in upcoming public housing developments. MND indicated that there will also be efforts to inject new retail supply into existing estates as necessary, including the potential for selectively acquiring privately held HDB shops if required.

This strategic move reflects HDB’s commitment to addressing the evolving needs of local communities while maintaining stability in the rental market.