More sustainable for operators and stallholders, while meeting essential needs of residents

HDB will provide enhanced support for HDB coffee shop operators and stallholders who choose to offer budget meal options, to keep the budget meal initiative sustainable while meeting essential needs of residents.

2 As of 31 December 2025, 350 HDB rental coffee shops and 48 privately-owned HDB coffee shops are providing budget meals.

3 Since the introduction of the budget meal initiative in 2018, HDB has been engaging operators, stallholders and residents regularly to refine the scheme¹. Operators and stallholders have shared concerns that the budget meal initiative is not sustainable due to rising costs and low take-up rates. Residents have also given feedback that the quality of budget meals is uneven and portion sizes can be inconsistent. To address these concerns, HDB will be making further changes to the budget meal initiative, which will take effect from 10 January 2026.

More funding support for operators and greater flexibility to offer budget meals in a sustainable manner

4 Currently, HDB provides rental coffee shop operators that offer budget meals a 5% discount off their renewal rents for a period of one year from the time of tenancy renewal.

5 To enhance the financial support for operators and stallholders, HDB will triple the amount of support provided by extending the 5% rental discount from the current one-year period to the full three-year tenancy term. This 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 under existing requirements will also automatically receive the discount for the rest of their current tenancy term².

6 For privately-owned HDB coffee shops that offer budget meals, HDB will provide financial support through a discount on the Temporary Occupation Licence (TOL) fees for their Outdoor Refreshment Area (ORA). The discount will be equivalent to 5% of the assessed market rent of the coffee shop over a 3-year period, capped at 100% of the TOL fee.

7 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 may cease and claw back the rental discounts, if they are not distributed in full to participating stallholders.

8 Under this new arrangement, operators can decide whether to participate in the budget meal initiative, in exchange for the rental discounts or TOL fee discounts. It is no longer mandatory for them to do so.

For existing rental coffee shop operators who are currently providing budget meals as a condition of their tenancy renewal, they may choose to maintain their existing budget meal arrangements or adopt the revised budget meal requirements (see Para 10). They can also decide whether to continue providing budget meals at their next tenancy renewal.
Newly-let rental coffee shops under the Price-Quality Method framework prior to 10 January 2026 (i.e. still within their first tenancy term) will continue to provide budget meals until the end of their current tenancy term, as required in their tender contract. They can decide whether to continue providing budget meals at their next tenancy renewal.

Standardised scope of budget meal requirements

9 Under the current budget meal initiative, HDB requires coffee shop operators to provide two to six budget meals (depending on whether they are sold or rental coffee shops) and two budget drinks. One downside of this arrangement is that the budget meals offered could be uneven across different coffee shops.

10 To better meet residents’ daily needs, we will standardise the scope of the budget meal requirement such that operators are required to provide three meal options: (a) an economy rice option (consisting of rice with one meat dish and two vegetable dishes), (b) a halal meal option, and (c) a breakfast item. The requirement to offer two budget drinks will remain unchanged. This will provide residents with affordable meal and drink options for their basic daily needs, while keeping the scheme sustainable for operators and stallholders. A summary of the changes is in the Annex.

11 Low-income households who require further assistance with cooked food may tap on support initiatives by their communities, such as meal vouchers, free breakfast and free bento lunches. These local community initiatives are offered by grassroots organisations or charities. They complement the Government’s efforts to support our lower-income residents.

Measures to encourage prudent bidding and reasonable stall rents

12 Beyond the above changes to the budget meal initiative, HDB will also be introducing measures to encourage operators to bid prudently and charge their tenants fairly.

Collection of data on coffee shop stall rents

13 HDB has kept our rental coffee shop rents stable in the past 3 years. 90% of HDB coffee shops did not have any rent increases from 2023 to 2025. 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 have remained largely unchanged.

14 To improve transparency and enable all stakeholders to make better-informed decisions on which HDB rental coffee shop and stall to rent, HDB will start collecting data on stall rents charged by the operators. HDB will then assess how the data can be made publicly available, to enable stallholders to use the information when they decide which stall to rent.

Tendered rent for shops to be maintained for two tenancy terms

15 From 10 January 2026, HDB will require successful bidders of all new shop tenders to maintain their tendered rent for two tenancy terms (i.e. 6 years), instead of the current one tenancy term (i.e. 3 years). By requiring tenderers to commit to tendered rent over a longer period, our aim is to encourage tenderers to bid prudently.

Ensuring access to affordable food options

16 HDB remains committed to ensuring that our HDB heartlands provide a variety of affordable cooked food options for residents. We will continue to ensure an adequate supply³ of coffee shops and other F&B options in every HDB town.

¹ Since 2018, new rental coffee shops tendered out under HDB's Price-Quality Method (PQM) framework have been required to provide budget meals. In May 2023, this requirement was extended to existing rental coffee shops renewing their tenancies. Subsequently, from December 2023, privately-owned HDB coffee shops that are sold on the open market were also required to offer budget meals. Since May 2025, privately-owned HDB coffee shops are required to offer budget meals upon renewal of their Temporary Occupation Licence (TOL) for the Outdoor Refreshment Area.

² Excludes new coffee shops in their first term of tenancy i.e. awarded before January 2026. These newly-tendered coffee shops would have taken into account the provision of budget meals in their price bids. These coffee shops may be eligible when they renew their tenancy agreement after the first term.

³ As of end 2025, there are 805 HDB coffee shops across Singapore, with another 43 slated for completion between 2026 and 2030.

Enhanced Support for HDB Coffee Shops to Provide Affordable Cooked Food Options in HDB Heartlands