New Government Legislation Discriminates Against Small Landlords
In regards to the new legislation on rent relief for tenants. I would like to highlight the discrimination towards the Smaller landlords. As a business owner who is both a tenant in a corporate shopping mall and owner of Strata shop unit. I have the perspective of being both a tenant and a small landlord. Here are some pointers that Small Landlords are not comparable to Corporate Landlords.
- Maintenance And Service Fees
Corporate Landlords own the entire building and manage the mall. In addition to the rental received, these Corporate Landlords collect a premium from their tenants to upkeep and manage the shopping mall.
Strata Landlords (Small Landlords) own shop units and do not manage the shopping mall. The Strata Landlords do not collect premium from their tenants for the mall operation. Instead to upkeep and manage the shopping mall, Strata Landlords have to pay maintenance and services fees (M&S) to a Managing Agent to operate the strata shopping mall.
- Gross Turnover
Corporate Landlords collect a shared percentage from their tenant business gross turnover (GTO).
Strata landlords are not entitled to any shared profit of the tenant business. This apply to landlords of shophouses and Strata offices and industrial units.
Putting into perspective, Corporate Landlords profit from the collection of rental premium and gross turnover from their tenants to upkeep and manage the mall. Whereas, Strata Landlords do not collect premium or GTO from their tenants. Despite the downside, Strata Landlords still have to pay Maintenance and Services Fees to upkeep and manage the mall.
On a side note.
Regarding the Financial Hardship Application Only For Landlord who own One property. The criteria on the number of commercial properties ownership is not a justifiable benchmark. Let me raise an example;
In a Strata mall, landlords who two or multiple tiny commercial units (boutique, salon) are not financially better off than the landlords who own only one big commercial unit (supermarket, restaurant). I could cite many more examples of such discrepancy.
I appeal to the Government to distinguish between Corporate Landlords and Smaller landlords. I have several solutions to offer if you like to further this discussion.