What are third-party facility providers?
A third-party facility provider is an entity that:
- Builds and Leases (B&L) a facility to an industrialist; or
- Buys a facility from an industrialist and leases it back to them
Third-party facility providers can be:
- Real Estate Investment Trusts (REITs), investment funds or trusts
Has a Trust Business Licence or a Capital Markets Services Licence issued by the Monetary Authority of Singapore (MAS). See MAS guidelines.
Has an established and credible track record in real estate development. This track record should take into account the last five years of the developer’s business.
- Industry association
Supported by the Economic Development Board (EDB) or Enterprise Singapore (ESG).
Third-party facility provider schemes
Third-party Build and Lease (B&L) scheme
This scheme allows an industrialist to appoint a third-party facility provider to develop a facility customised to their specifications and needs.
Upon completion, the industrialist will lease the facility from the third-party facility provider. The terms and conditions of the lease will be determined and agreed between both parties.
The industrialist will be the anchor tenant and must occupy at least 70% of the Gross Floor Area (GFA) of the facility. The anchor tenant will also need to fulfill a minimum Termination Prohibition Period (TPP).
Sale and Leaseback (S&LB) scheme
Under this scheme, an industrialist can sell a completed facility to a third-party facility provider. The industrialist will subsequently lease it back from the third-party facility provider. The industrialist will be the anchor tenant and must occupy at least 70% of the Gross Floor Area (GFA) of the facility.
Subletting by third-party facility providers
If the original anchor tenant leaves, third-party facility providers can make an application for a new anchor tenant(s) through the customer service portal.
The proposed new anchor tenant(s) must continue to occupy at least 70% of the Gross Floor Area (GFA). If there is more than one anchor tenant, each one must occupy at least 1,000 sqm.
The proposed new anchor tenant(s) must also meet JTC’s assessment criteria based on:
- The productivity of the space being used
- Creation of good quality jobs and value-add to the economy
During the subletting period, if the anchor tenant(s) wish to increase/decrease their GFA by more than 20% or change their usage, the third-party facility provider must re-apply to JTC for anchor subletting.
The remaining 30% of GFA can be sublet to other businesses, subjected to JTC’s assessment of usage compatibility, as well as payment of applicable subletting fees.
Further details on the subletting policy can be found here.