The New Paper - 10 May 2003

NOVENA SQUARE LOWERS RENTALS
Not good enough, says tenants

By Desmond Ng

THEY received up to 20 per cent off on their monthly rents at Novena Square.

While they welcomed the rebate, eight tenants we spoke to felt it may not be enough.

Junior De Artist's director Freddy Yip, who gives arts & craft lessons and sells related products, reckons a 50 per cent rebate would have been greatly welcomed.

He said: 'Look, we are bleeding here. It's a matter of time before some shops here have to call it quits.

'My business has dropped by at least 50 per cent as people are avoiding this area because we are near to TTSH. We need a hand.'

He is currently paying about $6,000 rent for his 660 sq ft space. He will receive a 20 per cent rebate.

But he did concede that 50 per cent is an unrealistic rebate to ask for as the landlord is also running a business.

He said: 'There's no point asking for more.

'This is worse than getting retrenched. Now, we don't earn anything and we still have overheads and rent to pay for.'

To improve business, he has started a delivery service, using his own car.

80 PER CENT DROP

The Skylight Garden restaurant, which has seen an 80 per cent drop in business since March, was also given a 20 per cent rebate.

They currently pay about $19,000 a month (without rebate) for their 2,300 sq ft unit.

Said manager Rasul Muhammad: 'The rebate helps a bit but it's not enough, we still have operational costs.

'In the last month alone, we had a nett loss of $60,000.'

If they don't get any help, Mr Rasul said they can last two more months. They will then have to decide whether to close down or relocate.

Whether the cause is their proximity to Tan Tock Seng Hospital (where all Sars patient are warded) or the economic downturn, business has plunged since last month - with some reporting an 80 per cent drop in their takings.

Three weeks ago, about 10 tenants, led by Mr Yip, approached the management.

Novena Square's management relented, and offered all their tenants a lifeline.

Most were given up to 20 per cent rebates off their rentals for three months - from April to June. (See report below.)

Perhaps the most telling account of how bad things are was during the 45-minute interview with Sports Elements: Only one customer walked into the store. And that was during the evening peak hour.

It now opens half an hour later and closes about an hour earlier.

They have seen a 70 per cent drop in takings since last month.

Partner Ben Soh said in Mandarin: 'On weekends, it's even worse. I can be here alone and I don't have anything to do.' He will receive a 10 per cent rebate off his $12,000 rental for his 900 sq ft place.



--------------------------------------------------------------------------------

Sharing the woes and working together


WHEN contacted, the management of Novena Square Shopping Mall said it had extended rental rebates of up to 20 per cent to most of its 84 tenants.

Said advertising & promotions manager Ms Claire Cher: 'We see it as sharing their woes during this difficult period.'

The mall also plans to hold an outdoor bazaar from May 9 to 11 with goods going for up to 70 per cent off.

Ms Pauline Tan, the associate director and head of retail at property consultancy Jones Lang LaSalle, said it's not common for landlords to introduce rebates across the board to all their tenants.

She added: 'But you do hear of tenants asking for help and rebates, as and when market is affected. And the landlord will review and may give out of goodwill.

'These terms are not in the contract and the rebates will hit the landlord in the pocket.'



Copyright © 2004 Singapore Press Holdings Ltd. All rights reserved.