Buying a Commercial Property in Singapore Super Guide
Buying a Commercial Property in Singapore
Advantage of Buying a Commercial Property in Singapore
No Additional Buyer Stamp Duty (ABSD), No Seller Stamp Duty (SSD), Foreigners Eligible, Can buy together with your friends and family, Can set up Goods and Services Tax (GST) registered Company to claim back GST.
Office
Retail
These include a wide array of venues such as shopping malls, pet shops, gyms, restaurants, lively bars, and traditional shophouses. Each offers unique opportunities depending on your business type.
Example of Retail for buying:
The Venue Shoppes Retail / F&B units with ready tenant for immediate rental yield
The Flow @ East Coast Retail unit just beside Marine Parade MRT at Prime Marine Parade Central Shopping area
Pros and Cons of Industrial Property
Procs: No Additional Buyer Stamp Duty (ABSD), Foreigners Eligible, Can buy together with your friends and family, Can set up Goods and Services Tax (GST) registered Company to claim back GST, usually lower price and higher rental yield for shorter leasehold property. Cons: There is Seller Stamp Duty (SSD) (15% within 1st year, 10% within 2nd year, 5% within 3rd year).
Business 1 Industrial (B1 Industrial)
Business 2 Industrial (B2 Industrial)
B2 Industrial are more suitable for heavier industries like manufacturing plants, factories and ramp up factories
Food Factory
One of the top choices for investment for Industrial Property because there is High Demand and Low Supply of Food Factory. Singapore Government intent to increase self produced food supply from 10% (year 2024) to 30% (2030), this will increase the demand for food factory greatly.
Some food factory are
CT Foodnex, Highest Specification among these food factories, the only food factory among new food factories that allow 40 footer container truck access. Have higher ceiling and power too.
Food Vision at Mandai, Slightly lower price but lower specification
Food Concept at Pandan, Ready unit with immediate rental yield.
Smart Food at Mandai, Slightly lower price then Food Vision but lowest specification
Another good thing about Food Factory is you can convert the unit to cloud kitchen(kitchen for the purpose of preparing food for delivery, example cake bakery or anything in Food panda & Grab), assuming $3000 per unit of cloud kitchen for 300sqft (10psf), you can possibly create 5 units of cloud kitchen inside 1 food factory unit. that’s like 15k a month rental X 12 months a year = $180k per year. For a $2.5m + $300k renovation = $2.8m property that’s at 6.4% yield That’s extremely high rental yield for a Freehold Property (usually 2+% yield for Freehold).
Foreign Ownership of Commercial Property in Singapore
In Singapore, the commercial property market is open and accessible to foreigners. There are no existing restrictions on purchasing various types of commercial properties.
Whether you’re interested in retail spaces, industrial sites, or hospitality venues, the rules are the same for everyone. Foreign buyers enjoy the same privileges as local buyers, meaning there are No Additional Buyer Stamp Duty or special eligibility criteria to meet.
This levels the playing field, allowing Singapore to be an attractive location for international investors looking to expand their real estate portfolios.
Buying a Commercial Property in Singapore under Personal name or Company name
Buying under personal name will be taxed based on personal tax rate.
https://www.iras.gov.sg/taxes/individual-income-tax/basics-of-individual-income-tax/tax-residency-and-tax-rates/individual-income-tax-rates
Buying under Company name will be taxed under company tax rate.
https://www.iras.gov.sg/taxes/corporate-income-tax/basics-of-corporate-income-tax/basic-guide-to-corporate-income-tax-for-companies
New company might have some tax rebate.
https://www.iras.gov.sg/quick-links/tax-rates/corporate-income-tax-rates
6 Financial Considerations When Buying a Commercial Property in Singapore
Thinking about buying a commercial property in Singapore? We’ve compiled a list of financial considerations for you to make the right decisions. In this section we’ll dive into the seven key aspects that’s important to the buying process.
1. Property Tax
Commercial properties are subject to a property tax rate of 10% of the annual value.
2. Buyer’s Stamp Duty (BSD)
BSD is mandatory for all property purchases. Here’s a breakdown of the rates for residential and commercial properties.
| Purchase price or market value of property | BSD for residential properties | BSD for non-residential properties |
| First $180,000 | 1% | 1% |
| Next $180,000 | 2% | 2% |
| Next $640,000 | 3% | 3% |
| Next $500,000 | 4% | 4% |
| Next $1,500,000 | 5% | 5% |
| Remaining amount | 6% |
3. Total Debt Servicing Ratio (TDSR)
Although the Additional Buyer’s Stamp Duty (ABSD) does not apply to commercial properties, TDSR limits monthly debt repayments to 55% of your income, influencing your mortgage and property choice for buyers purchasing under personal name. For buyers buying under operating company’s name, the bank will loan base on your company’s financial records.
4. Seller Stamp Duty (SSD)
SSD applies specifically to industrial properties
| Date of purchase / acquisition or date of change of zoning / use | Holding period | SSD rate (on the actual price or market value, whichever is higher) |
| On or after 12 Jan 2013 | Up to 1 year | 15% |
| Between 1 – 2 years | 10% | |
| Between 2 – 3 years | 5% | |
| More than 3 years | No SSD payable |
5. Goods and Services Tax (GST)
Commercial properties are also subject to a 9% (year 2024) and 10% (year 2025) GST charge, which cannot be financed through CPF or bank loans. GST applies to furniture and fittings within the property as well. You can claim back your GST if you bought the property using GST registered company.
6. Bank Loan Amount
Typically you eligible are borrow up to 70% for investment and 80% for own use but some banks allow you to stretch another 10% (subject to approval), but remember that commercial loan terms, including interest rates and tenures (capped at 30 years or up to age 75 year old). There are way to increase your loan duration if you are getting less than 30 years loan due to the cap at age 75 Whatsapp Vincent: 93799993 to help you increase the loan tenure, Vincent can also help increase your loan up to 150% Loan to Value.
Big Players are selling their Shop House to buy Office and Retail
