SINGAPORE Law and Practice Contributed by: Benjamin Tay, Chou Ching, Norman Ho, Vikna Rajah, Chun Kiat and Marcus Tay, Rajah & Tann Asia
compliance with the procedural requirements before advising their clients to re-enter. 6.20 Registration Requirements Leases for terms exceeding seven years must be reg - istered against the title of the landlord’s property to take effect as a legal interest binding on third parties. Registration is effected by lodging the lease instru - ment with the Singapore Land Authority. Stamp duty is payable on the lease before it can be registered. Shorter-term leases need not be registered but take effect as equitable interests only. Stamp duty on a lease is calculated at 0.4% of the total rent for leases of four years or less, and 1.6% of the average annual rent for leases of more than four years. The duty is customarily borne by the tenant. 6.21 Forced Eviction A landlord may forfeit a lease and recover posses - sion from a defaulting tenant by peaceable re-entry – provided the premises are unoccupied – or by court order. For occupied premises, court proceedings for a writ of possession are required. The Singapore courts have the power to grant injunctions and warrants of possession, and enforcement of a court order for pos - session can typically be effected within a few weeks of the order being granted, in the absence of an applica - tion for relief from forfeiture by the tenant. There are no ongoing pandemic-related eviction mor - atoriums in Singapore. All pandemic-related protec - tions for commercial tenants have expired. 6.22 Termination by a Third Party A lease may be terminated by the government through compulsory acquisition under the Land Acquisition Act 1966. Where the landlord’s land is compulsorily acquired, both the landlord’s and the tenant’s interests are acquired, and compensation is assessed sepa - rately for each. The tenant is entitled to compensation for the value of its leasehold interest and any distur- bance losses, which is assessed by the Collector of Land Revenue. Compulsory acquisition proceedings typically pro - ceed to completion within six to 12 months of the declaration of acquisition, though the compensation
assessment and any appeals may extend the over - all process. Tenants should ensure that their leases include appropriate provisions for the sharing of com - pulsory acquisition compensation. 6.23 Remedies/Damages for Breach In the event of a tenant’s breach and termination of a commercial lease, the landlord’s primary remedies are to recover arrears of rent and other sums due under the lease, to claim damages for loss of future rent (subject to a duty to mitigate by re-letting the premis - es), and to enforce any security deposit or guarantee. There are no statutory caps on a commercial land - lord’s damages for breach of lease in Singapore. Security deposits in commercial leases are typically held as cash, equivalent to two to three months’ rent, and are refundable at the end of the lease subject to deductions for outstanding liabilities and reinstate - ment costs. Letters of credit as security deposits are less common in Singapore than in some other markets but are used for higher-value commercial transactions. 7. Construction 7.1 Common Structures Used to Price Construction Projects Singapore construction contracts are priced on either a lump sum (fixed price) or a measurement basis. Lump sum contracts – most commonly using the Singapore Institute of Architects (SIA) Conditions of Building Contract or the Real Estate Developers’ Association of Singapore (REDAS) form for residen - tial projects – fix the contract sum at the outset, with variations priced at agreed rates or by agreement. Measurement contracts price the works by reference to a bill of quantities, with the final contract sum deter - mined by measurement of works executed. Design-and-build contracts are widely used for com - mercial, industrial and data centre projects, par - ticularly where speed of delivery and single-point accountability are priorities. Under a design-and-build arrangement, the contractor assumes responsibility for both design and construction, and the contract price is typically fixed at the outset. GLS sites with
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