SINGAPORE: Coffee shops under the Housing Development Board (HDB) will no longer be mandated to offer budget meals, under changes aimed at making the scheme more sustainable.
Instead, coffee shop operators can decide whether to participate in the initiative, in exchange for discounts on rent or Temporary Occupation Licence (TOL) fees, HDB said in a media release on Saturday (Jan 10).
HDB has also standardised the scope of requirements for budget meals from two to six budget meals to three meal options. The requirement to offer two budget drinks remains the same.
Budget meals are typically priced at S$3.50 (US$2.70) and below, and drinks are priced at S$1.20 and below.
The change will provide residents with affordable meal and drink options for their basic daily needs, while keeping the scheme sustainable for operators and stallholders, HDB said.
The budget meal initiative was introduced in 2018 at new HDB coffee shops tendered out under HDB’s Price-Quality Method framework to provide affordable meal options for residents.
The initiative was extended to all other HDB rental coffee shops renewing their tenancies in May 2023, and subsequently to privately-owned HDB coffee shops sold on the open market from December 2023.
As of Dec 31 last year, there were 350 HDB rental coffee shops and 48 privately-owned HDB coffee shops providing budget meals.
The budget meals initiative applies to HDB coffee shops, and is different from the National Environment Agency's (NEA) tender condition at socially conscious enterprise hawker centres (SEHCs) to implement measures to keep food affordable, such as by offering at least one value meal at each stall.
HDB said that coffee shop operators and stallholders have shared concerns about the unsustainability of the initiative due to rising costs and low take-up rates.
In 2023, some hawkers told CNA that they faced difficulties providing budget meals due to rising costs of operations.
Residents have also given feedback that the quality of budget meals is uneven and portion sizes can be inconsistent, HDB said.
In October, CNA TODAY reported that of the 40 budget meals assessed, none met the Health Promotion Board’s recommendations.
Budget meal requirements also differ across coffee shop operators, depending on whether they are privately-owned or rented. A downside of this arrangement is that the budget meals offered could be uneven across different coffee shops, HDB said.
From Jan 10, the scope of budget meal requirements will be standardised across coffee shop operators, HDB said.
Instead of at least four options, operators will be required to provide three meal options: an economy rice option consisting of rice, one meat, and two vegetable dishes, a Halal meal option and a breakfast item.
HDB said that with more support for operators to provide budget meals, residents can expect more consistent budget meal quality.
An economy rice stall at a coffeeshop along Yishun Ring Road that offers a budget meal option for S$3.30, on Oct 21, 2025. (Photo: CNA/Ooi Boon Keong)
Previously, HDB provided rental coffee shop operators a 5 per cent discount off their renewal rents for a period of one year from the time of tenancy renewal for participating in the budget meal initiative.
With adjustments to the initiative, the 5 per cent rental discount will be extended to the full three-year tenancy term.
The extended discount will apply to newly-let and existing rental coffee shops when they commence or renew their tenancies, if they choose to offer budget meals.
Existing rental coffee shops that are already offering budget meals will also automatically receive the discount for the rest of their current tenancy term, HDB said.
Operators of privately-owned coffee shops previously did not receive any funding support for participating in the initiative.
However, they can now receive a discount on their Temporary Occupation Licence fee for the outdoor refreshment area.
This is equivalent to 5 per cent of the assessed market rent of a coffee shop over a three-year period, capped at 100 per cent of the fee.
HDB said that operators who sign up for the initiative are required to pass on the discount in full to their tenants who are the stallholders providing budget meals.
“To ensure this, HDB will require operators to sign a letter of undertaking and declare how the discount is being shared amongst the stallholders who are offering the budget meals,” HDB said.
It added that it may cease and claw back the rental discounts if they are not distributed in full to participating stallholders.
In an FAQ page for the media, HDB said that there will not be a sudden change in the number of coffee shops offering budget meals, as most operators are not due for tenancy renewal.
Additionally, the tripled funding support to operators who offer budget meals will “encourage operators to participate in the scheme and offer budget meals on a sustainable basis”, HDB said.
HDB added that low-income households that require further assistance with cooked food may tap on support initiatives by their communities, such as meal vouchers, free breakfast and free bento lunches.
HDB said it will start collecting data on stall rents charged by operators. This will help improve transparency and help stakeholders make better-informed decisions on rent.
Rental coffee shop rents have remained stable in the past three years, with 90 per cent of HDB coffee shops not seeing rent increases, HDB said.
“Nonetheless, there are concerns that some operators may impose high rental mark-ups on their stallholders, even though the rents these operators pay to HDB has remained largely unchanged,” it added.
HDB will assess how the data can be made publicly available after collecting the data.
Additionally, HDB will require successful bidders of all new shop tenders to maintain their tendered rent for two tenancy terms, or six years, instead of one tenancy term, which lasts for three years. This applies to all newly tendered HDB shops, and not just coffee shops.
“By requiring tenderers to commit to tendered rent over a longer period, our aim is to encourage tenderers to bid prudently.”
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Instead, coffee shop operators can decide whether to participate in the initiative, in exchange for discounts on rent or Temporary Occupation Licence (TOL) fees, HDB said in a media release on Saturday (Jan 10).
HDB has also standardised the scope of requirements for budget meals from two to six budget meals to three meal options. The requirement to offer two budget drinks remains the same.
Budget meals are typically priced at S$3.50 (US$2.70) and below, and drinks are priced at S$1.20 and below.
The change will provide residents with affordable meal and drink options for their basic daily needs, while keeping the scheme sustainable for operators and stallholders, HDB said.
The budget meal initiative was introduced in 2018 at new HDB coffee shops tendered out under HDB’s Price-Quality Method framework to provide affordable meal options for residents.
The initiative was extended to all other HDB rental coffee shops renewing their tenancies in May 2023, and subsequently to privately-owned HDB coffee shops sold on the open market from December 2023.
As of Dec 31 last year, there were 350 HDB rental coffee shops and 48 privately-owned HDB coffee shops providing budget meals.
Related:
The budget meals initiative applies to HDB coffee shops, and is different from the National Environment Agency's (NEA) tender condition at socially conscious enterprise hawker centres (SEHCs) to implement measures to keep food affordable, such as by offering at least one value meal at each stall.
STANDARDISED SCOPE
HDB said that coffee shop operators and stallholders have shared concerns about the unsustainability of the initiative due to rising costs and low take-up rates.
In 2023, some hawkers told CNA that they faced difficulties providing budget meals due to rising costs of operations.
Residents have also given feedback that the quality of budget meals is uneven and portion sizes can be inconsistent, HDB said.
In October, CNA TODAY reported that of the 40 budget meals assessed, none met the Health Promotion Board’s recommendations.
Budget meal requirements also differ across coffee shop operators, depending on whether they are privately-owned or rented. A downside of this arrangement is that the budget meals offered could be uneven across different coffee shops, HDB said.
From Jan 10, the scope of budget meal requirements will be standardised across coffee shop operators, HDB said.
Instead of at least four options, operators will be required to provide three meal options: an economy rice option consisting of rice, one meat, and two vegetable dishes, a Halal meal option and a breakfast item.
HDB said that with more support for operators to provide budget meals, residents can expect more consistent budget meal quality.
An economy rice stall at a coffeeshop along Yishun Ring Road that offers a budget meal option for S$3.30, on Oct 21, 2025. (Photo: CNA/Ooi Boon Keong)
MORE SUPPORT
Previously, HDB provided rental coffee shop operators a 5 per cent discount off their renewal rents for a period of one year from the time of tenancy renewal for participating in the budget meal initiative.
With adjustments to the initiative, the 5 per cent rental discount will be extended to the full three-year tenancy term.
The extended discount will apply to newly-let and existing rental coffee shops when they commence or renew their tenancies, if they choose to offer budget meals.
Existing rental coffee shops that are already offering budget meals will also automatically receive the discount for the rest of their current tenancy term, HDB said.
Operators of privately-owned coffee shops previously did not receive any funding support for participating in the initiative.
However, they can now receive a discount on their Temporary Occupation Licence fee for the outdoor refreshment area.
This is equivalent to 5 per cent of the assessed market rent of a coffee shop over a three-year period, capped at 100 per cent of the fee.
HDB said that operators who sign up for the initiative are required to pass on the discount in full to their tenants who are the stallholders providing budget meals.
“To ensure this, HDB will require operators to sign a letter of undertaking and declare how the discount is being shared amongst the stallholders who are offering the budget meals,” HDB said.
It added that it may cease and claw back the rental discounts if they are not distributed in full to participating stallholders.
In an FAQ page for the media, HDB said that there will not be a sudden change in the number of coffee shops offering budget meals, as most operators are not due for tenancy renewal.
Additionally, the tripled funding support to operators who offer budget meals will “encourage operators to participate in the scheme and offer budget meals on a sustainable basis”, HDB said.
HDB added that low-income households that require further assistance with cooked food may tap on support initiatives by their communities, such as meal vouchers, free breakfast and free bento lunches.
RENT TRANSPARENCY
HDB said it will start collecting data on stall rents charged by operators. This will help improve transparency and help stakeholders make better-informed decisions on rent.
Rental coffee shop rents have remained stable in the past three years, with 90 per cent of HDB coffee shops not seeing rent increases, HDB said.
“Nonetheless, there are concerns that some operators may impose high rental mark-ups on their stallholders, even though the rents these operators pay to HDB has remained largely unchanged,” it added.
HDB will assess how the data can be made publicly available after collecting the data.
Additionally, HDB will require successful bidders of all new shop tenders to maintain their tendered rent for two tenancy terms, or six years, instead of one tenancy term, which lasts for three years. This applies to all newly tendered HDB shops, and not just coffee shops.
“By requiring tenderers to commit to tendered rent over a longer period, our aim is to encourage tenderers to bid prudently.”
Related:
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