Ministers’ Rental Rates of Ridout Road Colonial Houses Are Comparable to Neighbouring Houses

In case you’ve been living under a rock, one of the hottest saga in Singapore, comparable to the Taiwanese #MeToo movement is the Ridout Road Colonial Houses Rental.

Well, that’s been concluded yesterday and the only “bad guy” caught was the Singapore Land Authority (SLA).

You can read more about that here.

One of the main points of contention is that the Ministers are paying below-market-rate rents because they are, well, ministers.

Well, is that true? Apparently not, according to the numbers.

Minister’s Rental Rates

Before we look at the neighbours, let’s look at the ministers’ rental fees.

For Home Affairs and Law Minister Shanmugam, he rented his colonial home back in June 2018 at S$26,500 per month. That’s high, but it’s because it’s huge. This comes out to around S$30.94 per sqm per month.

Meanwhile, Foreign Minister Balakrishnan rented his property in October 2019 for S$19,000 per month, which comes out to around S$23.05 per sqm per month.

In October 2022, the rate was revised to S$20,000 per month for a renewal of 3 years.

Ministers’ Rental Rates of Ridout Road Colonial Houses Are Comparable to Neighbouring Houses

According to reports, the average rent per unit floor area for 2018 was S$29.78.

Properties	Floor area	Start date	Rent	Rent per unit floor area
A	400	Jan 2018	$11,000	$27.50
B	300	Jan 2018	$10,000	$33.33
C	300	Jun 2018	$9,000	$30.00
D	300	Jun 2018	$9,000	$30.00
26 Ridout Road	856.5	Jun 2018	$26,500	$30.94
E	800	Jun 2018	$26,000	$32.50
F	500	Jun 2018	$13,000	$26.00
G	400	Aug 2018	$11,000	$27.50
H	300	Sep 2018	$9,000	$30.00
I	300	Nov 2018	$9,000	$30.00
			Average	$29.78

Source: Straits Times via MCI

Essentially, Minister Shanmugam paid above the average rental rate for his property.

In 2019, the average rent per unit floor area was S$29.60.

Properties	Floor area	Start date	Rent	Rent per unit floor area
J	300	Apr 2019	$8,000	$26.67
B	300	Aug 2019	$10,000	$33.33
K	300	Aug 2019	$10,000	$33.33
E	800	Sep 2019	$26,000	$32.50
L	300	Sep 2019	$10,000	$33.33
M	400	Oct 2019	$10,000	$25.00
31 Ridout Road	824.3	Oct 2019	$19,000	$23.05
			Average	$29.60

Source: Straits Times via MCI

The amount paid by Foreign Minister Balakrishnan was lower than the average at S$23.05. According to the report, it was due to the condition of the property when it was rented.

It was added that the rent per unit floor area was “comparable” to other properties of average condition.

Law Minister Asks Not To Pay Lower Than What Neighbours Are Paying

Mr Shanmugam had been visiting properties since 2017, each of which prominently displayed a “For Lease” sign.

At 26 Ridout Road, he noticed the nearby land’s overgrown vegetation, raising public health concerns due to potential risks such as snakes, mosquitoes, or falling trees.

The state property there had lain vacant since December 2013, failing to attract bids for over four years.

In 2018, Mr Shanmugam employed a property agent to facilitate a rental agreement for the property.

Through his property agent, Mr Shanmugam negotiated with SLA to clear this adjacent land before renting the property, at his own expense, citing health and safety concerns if the land wasn’t properly maintained.

He had no intention to rent the adjacent land but was pressed to do so by the SLA.

As for the guide rent, Mr Shanmugam and his agent were uninformed.

The agent researched the rental prices of comparable properties in the area and independently calculated the rent.

During this process, Mr Shanmugam instructed his agent not to offer less than what his neighbors were paying.

Maybe he foresaw this day coming.

You can read more about the full report here.