PERCENTAGE LEASES IN SHOPPING CENTRES

Abstract

Recently, retailers have realized the importance of finding alternative ways to cut down on costs incurred in their businesses, especially now when the future outlook is uncertain. Unforeseen circumstances like the breakout of war and the spreading of unknown diseases around the world have been happening in the recent years and many businesses around the globe have suffered. Shopping centers in Singapore are not spared from the calamity either. It is evident from newspapers reports that people do not dare venture out of their homes when disaster strikes. As a result, with fewer customers patronizing the shops in the shopping centers, the retail business will falter. Due to the uncertainty of the economic outlook, retailers have to look into ways, which they can reduce the burden of having to pay high rents. Therefore, an effective scheme to help tide them over a crisis would be the adoption of the percentage lease scheme. The survey results show that the percentage lease scheme has its benefits but there are tenants and landlords who did not adopt it. Therefore, this research examines their reasons for rejecting the scheme. Statistical computations will be done to analyse what each party feels about the scheme and from here, both parties can better understand each other and be more receptive towards the percentage lease scheme. I he findings also show that although there are an increasing number of people accepting the scheme, more can be done to encourage a larger number of people to adopt the scheme.