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The Truth About BTO Coffeeshop Rentals, Can Rental Price Be Lowered?

 






Have you ever wondered why hawker food prices keep rising? Why your simple chicken rice now costs $5 or more? Many hawkers are struggling, not because they want to raise prices, but because of high food costs, rental fees, and labor expenses. Today, I’m going to focus on rental costs—one of the biggest reasons why food prices are going up.

Before becoming a content creator, I was aspired to be a hawker. I even tried bidding for a hawker stall but lost. Over the years, I’ve spoken to many hawkers about their struggles, and today, I want to share insights that I believe many hawkers want the government to hear.

You might ask, what have coffeeshop have to do with the government? Well, new BTO coffeeshop are awarded by bidding system from HDB. BTO coffeeshops are charging sky-high rental fees. For example, a new coffeeshop in Tampines has stalls renting for $8,000 to $10,000 per month! Another coffeeshop in Tengah was awarded at $60,000 per month, meaning each stall’s rental is at least $8,000. Good luck to the Tengah resident on finding affordable food. 

From my research, HDB awarded 9 new BTO coffeeshops in 2024. The highest rental awarded was $89,000 per month, while the average was around $59,000 per month. If a coffeeshop has 10 stalls, and the coffeeshop operator make a profit of $2,000 per stall, each stall’s rental would still be $8,000 per month or $263 per day!

HDB requires new BTO coffeeshops to sell budget meals at $3.50, but let’s do the math.

Even if hawkers make 100% profit on every meal, they need to sell at least 150 budget meals daily just to cover rent. But in reality, food costs, labor, electricity, and other expenses exist, so hawkers are not making much for $3.50 meals and required 200-300 budget meals just to break even. They have to sell regular dishes at average $5 and above in order to breakeven or making a profit if sales is good.

So before you complain about your $5 chicken rice, remember—a huge chunk of that money is going to cover rental costs, not just ingredients.

Only recently, the government said they will consider other factors beyond just the highest bid when awarding coffeeshop tenders. But I believe the simplest solution is to cap coffeeshop rental at $20,000 per month.

With lower rental, hawkers can rent stalls at below $3,000 per month, which would bring down food prices. Yes, the government might lose afew hundreds of millions per year, but in return, Singaporeans get more affordable food, and hawkers won’t be forced out of business.

At the end of the day, I’m not an economist or an analyst—I’m just a Singaporean giving honest feedback. If we don’t address this issue, hawkers will continue to struggle, and affordable food might become a thing of the past. I do hope the government representative can go around and talk to stalls owners to understand the people better?

What do you think? Should the government step in to lower rental costs? Let me know in the comments!

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