On Thursday (28 May), Facebook page SG Turf – Singapore Tenants United For Fairness highlighted a case about a tenant in a mall who was subjected to unfair treatment by the landlord.
In the post, it was stated that the tenant, Randy (not his real name), was first approached by a Government Agency to open his own restaurant outlet at a newly built mall a few years ago. The management of the mall was handled by a Real Estate Agency (which we will address as the Landlord in this article).
Given that this new mall was located at a “high traffic location”, Randy’s rental rate was also on the higher side, at S$20,000 per month. However, since it was purely a commercial mall, there weren’t any anchor tenant like a supermarket or departmental store in it to draw in foot traffic.
As such, SG Turf said in the post that the Landlord promised to carry out numerous high profile events and activities to draw in customers into the premise. In fact, this was promised to all the tenants before they were recruited into the mall.
“Initially, there was a lot of buzz and hype about how this mall would be a great gathering location for many people of similar interests. Tenants were recruited with promises of many high profile events and organised activities,” SG Turf stated.
It added that with no anchor tenants in the mall, “footfall was thus extremely dependent on the planning and execution of such activities”.
Unfortunately, things took an ugly turn after a few weeks due to a number of different issues.
“Firstly, the buzz never came. Then the promised activities and events were far and between. Footfall was pathetic. Targeted crowds were not attracted. There were also many severe mismanagement issues.”
As expected, all shops in the malls were losing thousands and thousands of dollars every month.
After three months, all the tenants came together to request the Landlord to take some measures to solve the problem. Some of the things they requested include increased advertising and promotion and for the mall to carry out more activities to draw in more foot traffic, as well as to reduce the rental fees so the tenants’ burden will be lifted off their shoulders slightly.
Eventually, the Landlord agreed to reduce the rental by 20 per cent, which means Randy still has to pay S$16,000 “for a shop in a ghost town”.
Calls it quits
Three months later, Randy decided to call it quits and requested the Landlord to “take over his restaurant and all its nicely done up renovations and furnishing for free”. He even decided to forgo the Security Deposit, but the Landlord refused the request.
“He would even give up the three months’ worth of Security Deposit. But alas, they [the Landlord] refused (which says a lot).”
To make it worse, the Landlord “demanded” Randy to pay the remaining rental amount until the end of the lease, which is coming up to S$600,000.
“No, he did not have $600K nor did he have the means to continue operating at such brutal losses each month. Randy eventually shut down operations without approval. He did not have a choice,” SG Turf noted.
Soon after that, it was revealed that the Landlord decided to sue Randy, which was described as “the most cruel and extreme route” in the post.
However, the matter was resolved after a few “exhausting court sessions”, and the Landlord decided to settle on a “lower but equally appalling sum of compensation”.
Despite settling at a lower amount, Randy still lost half a million in the lawsuit.
“So did most of the other tenants who left one after another. All because they believed. And trusted such an organisation to have done better. Done fairer. But it did not,” SG Turf wrote.