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  • Writer's pictureGIGI WANG

Renting A Commercial Shophouse Space In Singapore For Your Business

Updated: Oct 22, 2023



A Step By Step Guide On How To Begin Your Search For A Commercial Shophouse Space To Rent In Singapore


Generally there are 5 different types of prospects that I meet on a daily basis when showing commercial shophouse units for rent in Singapore. They are 1)Companies that are currently located in offices buildings 2)Start up businesses that are looking to grow and move out of co-working spaces 3)Businesses that are established in other countries that have recently opened or looking to open a branch in Singapore 4)Relocating from another shophouse unit 5)Completely new business.



What Are Your Criterias?

When looking to rent a commercial shophouse space it is important to determine your requirements and criterias. Before you start searching for commercial shophouse units in Singapore to rent whether it be for a restaurant, retail shop, fitness or office, you need to determine your requirements such as the size, location, unit condition and most importantly budget. Most commercial shophouses in Singapore are walkups and do not have elevators. Location is important, do you need to be near an MRT and is having a carpark nearby a factor that needs to be considered.


For clients looking for commercial shophouse office spaces, here are some more specific details that you may want to consider to narrow down your search:

  1. The condition of the shophouse unit: -Bare Units: Units are normally handed over with no air conditioners or lights -Partially Fitted: Units are normally handed over with air conditioning units, lights and some fixtures such as pantry, cabinets. -Fully Fitted/Furnished Units: This normally includes workstations, chairs, air conditioners, lights, partitioned meeting rooms/executive offices and pantry area. There are also units that come fully furnished plus fully serviced which include cleaning services, wifi and include utilities.

  2. Confirm if the shophouse unit is approved for office use by URA (your Property Agent can check for you). These are some common examples of concepts that fall under shop use: retail, hair salon, nail salon, tailor shop.

  3. Inquire if the Landlord is GST registered to know if the asking rental will be subject to GST or not subject to GST.


Tip: Be sure to also ask if there are additional service fee or maintenance charges.


 


From Top To Bottom: Renovated/Partially Furnished Shophouse Space, Fully Furnished Shophouse Office Space, Partially Furnished Shophouse Space

 


For clients looking for retail (shop) spaces, here are some more specific details that you may want to consider to narrow down your search:

  1. The condition of the shophouse unit: -Bare Units: Units are normally handed over with no air conditioners or lights. -Partially Fitted: Units are normally handed over with air conditioning units, lights.

  2. Confirm if the shophouse unit is approved for shop use by URA (your Property Agent can check for you). These are some common examples of concepts that fall under shop use: retail, hair salon, nail salon, tailor shop.

  3. Inquire if the Landlord is GST registered to know if the asking rental will be subject to GST or not subject to GST.


Tip: Be sure to also ask if there are additional service fee or maintenance charges.



For clients looking for Restaurant/F&B/F&B Takeaway spaces, here are some more specific details that you may want to consider to narrow down your search:

  1. The condition of the shophouse unit: -Bare Units: Units may or may not have air conditioners or lights when handed over.

  2. -Partially Fitted: Units are normally handed over with air conditioners, lights, grease trap and exhaust provisions. -Fully Fitted/Take Over Units: This normally includes all the existing fixtures and fittings, furnitures, kitchen equipment, and is usually subject to a take over fee that needs to be discussed and negotiated directly with the current tenant. Rental is to be discussed with the Landlord.

  3. Confirm if the commercial shophouse unit is approved for F&B/Restaurant or F&B Takeaway use by URA. There are some units that are currently not approved for F&B/Restaurant or F&B Takeaway, however if permitted by URA (the Property Agent can check URA Space to see if URA allows the use for the address). The client can then apply for Change Of Use and seek URA approval. Tip: Please know that any Letter Of Intent submitted for a unit that needs to apply for change of use should be Subject to Approval.

  4. Check to see what the power supply is for the unit.

  5. Client must also get licenses from the appropriate authorities such as Singapore Food Agency (SFA), Singapore Civil Defence Force (SCDF).

  6. Inquire if the Landlord is GST registered to know if the asking rental will be subject to GST or not subject to GST.


Tip: Be sure to also ask if there are additional service fee or maintenance charges.


 

From Top To Bottom: Bare Shophouse Space With Air Conditioners & Lights, Bare Shophouse Space Unit With No Air Conditioners Or Lights, Bare Shophouse Space With No Lights Or Air Conditioners

 

For clients looking to open a yoga studio/pilates studio/gym (fitness) in a commercial shophouse space, here are some more specific details that you may want to consider to narrow down your search:

  1. The condition of the shophouse unit: -Bare Units: Units are handed over with no air conditioners or lights. -Partially Fitted: Units are normally handed over with air conditioning units, lights.

  2. Confirm if the shophouse unit is approved for fitness use by URA (your Property Agent can check for you).

  3. Be prepared to be asked by the Landlord if you will be doing the necessary sound proofing.

  4. Inquire what the max loading weight capacity is (to ensure the unit can hold heavy equipment (if necessary) and the ceiling height.

  5. Inquire if the Landlord is GST registered to know if the asking rental will be subject to GST or not subject to GST.


Tip: Be sure to also ask if there are additional service fee or maintenance charges.



It’s Now Time To Do Online Research Or Find A Property Agent To Work With

The top three online real estate portals in Singapore most commonly used by people looking to rent or buy commercial property are www.commercialguru.com, 99.co, and iProperty.com. These online portals are user friendly and provide details of the commercial properties available for sale or for rent with photos, descriptions, asking prices and Property Agent contact details. You can contact the Property Agent directly from the listing and arrange for viewings. Or if you prefer to work with a Property Agent who specialises in commercial properties, they will assist you in arranging units to view, facilitate negotiations with the Landlord and assist in submitting documents. Please note that normally the Landlord will pay the Property Agent fee (commission) or the Property Agent will collect the fee from the co-broking Agent. After viewing the rental units, you can shortlist a couple to determine which ones best suits your needs. When the commercial shophouse rental market is hot (which it is currently) , time is of the essence. The availability of units will be low and the demand for commercial shophouse rental units is high. Landlords may be receiving multiple offers, so if there is a commercial shophouse rental unit you’re interested in, it’s best to do a second viewing soon after to bring your contractor or ID for a site visit to do measurements or put in an offer.


Tip: Ask the Property Agent if the Landlord requires: Admin Fee/Legal Fee, Utility Deposit, Renovation Deposit and how many months is the Security Deposit (most commercial Landlords require 3 months security deposit for 2 or 3 year lease term).


Submitting An Offer & Letter Of Intent

You’ve decided on a commercial shophouse unit that suits your needs and would like to move forward with an offer. When submitting an offer, the Property Agent will need the following details and terms to prepare the Letter Of Intent:

  1. Rental Offer

  2. Length Of Lease: Normally Landlords require a minimum of 2 years lease, however there are Landlords open to 1 year lease but minimum requirement is a 6 month lease.

  3. Option To Renew: 2 plus 2 year option to renew, 3 plus 2 year option to renew are to common options.

  4. Request For Free Fitting Out Or Free Renovation Period: The amount of time the Landlord will allow for free fitting out periods or free renovation period depends on the size and condition of the unit. Usually for a 1,000 sq ft rental unit, the Landlord may allow 4 weeks. Larger units of 2,000 sq ft and above, can request 6-8 weeks. Individual Landlords each have their own requirements.

  5. Key Handover Date: This is the date the the keys to the unit will be handed to the tenant for them to begin their free fitting out of free renovation period.

  6. Lease Commencement Date: The date when the lease commences.

  7. Request/Requirements: If there are additional requirements that the client would like to request from the Landlord, it would be stated here. Examples: to have the air conditioners serviced once before handover, paint the walls, reinstate the unit to bare and original.

  8. Provide Biz File


After signing the Letter Of Intent, the client will have to also provide a Good Faith Deposit in the amount of 1 months rent to the Landlord. This can be done by cheque or bank transfer depending on your Landlords requirements. The Good Faith Deposit is to secure the unit while the client and the Landlord negotiate the terms on the Letter Of Intent. The Good Faith Deposit will be put towards the first months rent (and if the Landlord is GST registered, the Good Faith Deposit can be topped up with the GST amount when the Tenancy Agreement is signed. Once the Landlord counter signs the Letter Of Intent, you will move forward with the Tenancy Agreement.


Tip: The Property Agent should provide you with the proof of ownership at this time. The Landlord bank details should match the business name and address provided on the proof of ownership. I purchase the proof of ownership from INLIS and provide a copy to the clients.


Tenancy Agreement

A draft Tenancy Agreement will be prepared by the Property Agent or the Landlord for the clients review. If you have any inquiries or require any request for amendments to be made on the Tenancy Agreement, you would let the Property Agent or Landlord know at this point.

Once both parties have agreed on all the clauses and terms on the Tenancy Agreement, the next step would be to sign the Tenancy Agreement. Most Landlords will allow Tenant to e-sign and pass 2 signed and company stamped hardcopies to them at a later date. At this time, client is also required to make necessary payment requisites for the Admin Fee/Legal Fee, Utility Deposit, Renovation Deposit and Stamp Duty.


Handover

On the day of key handover, the landlord and/or the Property Agent will go over all the fixtures in the unit and point out any defects. As the Property Agent, I would normally prepare a defect report for reference, which I would provide to both the Landlord and Tenant. This would be used as reference at the end of the lease term when the unit is handed back to the Landlord.


Renting a commercial shophouse space for a business may not suit everyone but many clients I have assisted believe that Singapore shophouses provide character and the flexibility for the tenant to renovate the space to reflect their brand. Clients who rent an entire shophouse, have the option to paint the exterior facade and/or have a mural designed to represent their brand (with Landlord and URA approval). Clients that have rented single level shophouse office spaces can get just as creative with their designs as well.


Keong Saik Road Shophouse Mural
Keong Saik Road Shophouse Mural, Singapore

It is important to note that renting a commercial shophouse space in Singapore can be competitive, so it is recommended to start your search early and be prepared to act quickly when you find a property that meets your requirements.


If you have any questions in regards to my article or are in the market for a commercial shophouse rental, feel free to contact me Gigi Wang at gigiwang.sg@gmail.com or send me a Whatsapp at +65 8820 3988.




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