SINGAPORE Trends and Developments Contributed by: Monica Yip and Dorothy Marie Ng, WongPartnership
Property Tax It was announced in the Singapore Budget 2024 that the bands of annual values with respect to calculation of property tax for owner-occupied residential properties would be adjusted from 1 January 2025. The expectation is that the amount of property tax payable by many home owners will not increase or, in certain cases, be lower, though the property tax payable by own - ers of high-end properties will likely increase. The Singapore government intends to continue to monitor the market and may announce other property tax measures if necessary. Whilst these changes to the property tax pay - able are good news for most home owners, they may not be sufficient to influence potential home-buyers or investors who wish to enter the residential market. Code of Conduct for Leasing of Retail Premises The Lease Agreements for Retail Premises Act 2023 came into force on 1 February 2024, mak - ing it mandatory for all qualifying retail leases in Singapore signed on or after that date to be in compliance with the Code of Conduct for Leas - ing of Retail Premises. The Code of Conduct was first introduced in March 2021, but had remained optional until the Lease Agreements for Retail Premises Act 2023 took effect. Some key features of the Code of Conduct include the following: • The Code of Conduct sets out 13 leasing principles for landlords and tenants of retail premises to follow in their leases, which include guidance in relation to the appor - tionment of costs in preparing lease docu - ments, and the pre-termination rights that the landlord and tenant have. “Retail premises”
include premises used for businesses such as food and beverage, clinics, sports and recrea - tion, and childcare centres. • Whilst landlords and tenants are permitted to deviate from some (but not all) leasing principles set out in the Code of Conduct, a declaration of permitted deviation must (if applicable) be submitted to the Fair Tenancy Industry Committee (FTIC) within a prescribed period as failing to do so may result in such permitted deviation being void. • Where there are queries about the applicabil - ity of any leasing principle, landlords and ten - ants may submit such queries to FTIC, which periodically updates the Code of Conduct to address the prevailing requirements and trends of the retail industry. Landlords and industry players with leasing port - folios are advised to review their lease templates to ensure that they fulfil the requirements of the Code of Conduct. In relation to renewals for existing leases, landlords should also consider whether such renewed leases would need to fulfil the requirements of the Code of Conduct. Mandatory Energy Improvement A new bill, the Building Control (Amendment) Bill, was passed on 10 September 2024 and is expected to come into force in the third quarter of 2025. The Bill will introduce a new Manda - tory Energy Improvement (MEI) regime requiring owners of energy-intensive buildings with a mini - mum gross floor area of 5,000 square metres to appoint qualified persons to carry out an energy audit, and develop an Energy Efficiency Improve - ment Plan to reduce energy use intensity by at least 10% from levels as at the energy audit. While previously, only new buildings, buildings undergoing major retrofitting works and major energy use changes were subject to energy
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