Forum: HDB ensures a good supply of eating houses with affordable food options

We thank Mr Keith Wong (Ensure coffee shop prices remain affordable, June 20), Mr Jonathan Wong (Not Govt's business to intervene in commercial decisions, June 22), Mr Peh Chwee Hoe (Residents in some places at the mercy of high coffee shop prices, June 24) and Mr Lee Yat Cheong (Sad if communal experience of coffee shops is lost due to higher prices, June 24) for their feedback.

To provide residents with access to affordable food options, HDB ensures that there is a good supply of eating houses in every HDB estate and town to maintain healthy price competition. There are presently 772 HDB-built eating houses, of which 372 are rented out by HDB and 400 are privately owned.

Thirty-four eating houses were completed in the past four years, and another 30 eating houses will be completed in the next four years. There are over 100 hawker centres in Singapore, and the Government is building more - four new centres will begin operations this year, with another seven being planned or under construction.

Privately owned eating houses are transacted on a willing-buyer- willing-seller basis. To deter speculation, HDB has discontinued the sale of eating houses since 1998. All new eating houses built are now rented out by HDB, typically on a tenancy term of three years, with the option for renewal.

In 2018, HDB introduced the Price-Quality Method, where prospective eating house operators renting from HDB are assessed not just on their price bids, but also on the quality of their offerings and track records.

Quality score counts for 50 per cent of the evaluation, and operators with affordable food options will be awarded higher points under this scoring system. The median rent for eating houses tenanted out by HDB has remained stable for the past five years.

While the stall rental rate is a private contractual agreement between the eating house operator and individual stallholders, it is in the operator's business interest to keep the rents of their stalls reasonable to retain its stallholders.

If the rents are too high, stallholders could move to other nearby eating establishments, resulting in vacant stalls and holding costs for the operator.

Similarly, stallholders will usually also benchmark their cooked food prices to other eating establishments in the vicinity to attract diners and remain competitive.

HDB will continue to monitor the eating house operators' performance and ensure that there are adequate eating houses available, so that residents can continue to enjoy affordable food options.

He Kangwei

Director (Policy and Planning)

Housing and Development Board

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