Changi Airport tenants get 50% rental rebate for six months

Singapore

RETAIL, food & beverage (F&B) and service tenants at Changi Airport will be granted a 50 per cent rebate on monthly basic rent for six months as they grapple with weaker travel and consumer demand following the Covid-19 outbreak.

It was announced during the Budget on Tuesday that the government, the Civil Aviation Authority of Singapore and Changi Airport Group (CAG) will extend a S$112 million Aviation Sector Assistance Package to the airport community to help offset business costs and safeguard jobs.

This includes a 15 per cent property tax rebate to Changi Airport from the government, which the airport operator will fully pass on to the aviation community under the package.

The rebate, which kicks in from Feb 1, is on top of an automatic rental offset linked to passenger traffic at Changi Airport that these concessionaires will receive as part of their tenancy agreements. The agreement is structured such that "a sizeable portion" of rental varies in line with passenger traffic; should passenger traffic fall, they see a corresponding reduction in rent.

Meanwhile, CAG has also shortened operating hours for tenants in the transit area - except for essential retail and F&B outlets - while those in the public areas will be given the choice of trimming operating hours. Changi Airport's four terminals has over 400 retail and services stores, as well as more than 140 F&B outlets.

Lim Peck Hoon, executive vice-president (commercial) at CAG, said: "The shops and restaurants in Changi Airport are very much dependent on passenger traffic. The Covid-19 situation has affected air travel significantly, and there has been a marked drop in business for our concessionaires."

She added: "With our unique rental structure, our concessionaires will benefit from an automatic reduction in their rent in tandem with the reduction in passenger traffic. In addition, we have decided to provide further assistance by reducing the basic rental to help our concessionaires during this very difficult period."

With some businesses being hit especially hard, CAG said that it is in talks with certain concession partners to offer additional help.

Other efforts by CAG to bolster consumer demand will include marketing and promotional initiatives to incentivise spending by visitors and airport employees.

Meanwhile, airlines and cargo operators are also receiving support from the airport, including 100 per cent parking charge rebates for all scheduled passenger flights and 10 per cent landing charge rebates for freighter flights.