Covid-19: Extension of temporary relief measures for property developers affected by disruptions to construction timelines following tighter border measures

8 July 2021

On 28 June 2021, the Singapore Government announced an extension to the temporary relief measures for property developers affected by disruptions to construction timelines following the tightening of border measures from April and May 2021 due to the Covid-19 pandemic. The property sector may experience manpower shortages and further disruptions to construction timelines as the tightening of border measures limit the inflow of migrant workers.

The following temporary relief measures are extended with effect from 28 June 2021:

• Extension of the Project Completion Period (“PCP”) by six months for qualifying residential, commercial and industrial development projects;
• Extension by six months for the commencement and completion of residential development projects in relation to the remission of the Additional Buyer’s Stamp Duty (“ABSD”) for qualifying housing developers; and
• Extension of the PCP by six months for residential development projects under the Qualifying Certificate (“QC”) regime for qualifying foreign housing developers. 

These measures are in addition to the temporary relief measures announced on 6 May 2020 and 8 October 2020 and highlighted in our articles titled “Covid-19: Temporary relief measures for property sector” and “Covid-19: Additional temporary relief measures for property developers affected by disruptions to construction timelines”.

These temporary relief measures do not alter the existing residential property market cooling measures which remain to ensure that private residential property prices are broadly consistent with economic fundamentals. All housing developers will continue to be subject to the prevailing ABSD regime.

With the extension to the temporary relief measures, the Government expects developers to similarly provide relief and support to their main contractors and consultants.

Private residential development projects

Project Completion Period (PCP)

The PCP for qualifying residential development projects on Government sale sites, or on land which was directly alienated or had its lease renewed by the Singapore Land Authority (“SLA”), will be extended by six months. The conditions to be met for the extension of the PCP are as follows:

• The land was awarded on or before 7 May 2021, or the land was directly alienated or the developer had its lease renewed by SLA on or before 7 May 2021; and
• The original timeline for completion of the residential development expired on or after 1 February 2020.

For cases where the land was awarded on or before 1 June 2020, or where the land was directly alienated or the developer had its lease renewed by SLA on or before 1 June 2020, this six-month extension is in addition to the cumulative 12-month extension that was provided via the temporary relief measures announced on 6 May 2020 and 8 October 2020.

No application is necessary as qualifying developers will be notified by the respective agencies.

Additional Buyer’s Stamp Duty (ABSD)

Under the ABSD regime, developers are to commence and complete the residential development, and sell all housing units in the residential development project within specified timelines, failing which they will be subject to ABSD on the purchase of the land.

By way of background, the specified timeline for commencement of housing development is two years from the purchase of the land for all housing developers. The specified timelines for completion of housing development and sale of all housing units are five years from purchase of the land for licensed developers (those who construct more than four housing units), and three years from purchase of the land for non-licensed developers (those who construct no more than four housing units). Under the temporary relief measures announced on 6 May 2020, the specified commencement, completion and sale timelines were extended by six months, subject to conditions. Under the temporary relief measures announced on 8 October 2020, the commencement and completion timelines were extended by a further six months. There was no further extension of the timeline for the sale of the housing units.

It was announced on 28 June 2021 that the commencement and completion timelines will be extended by six months for qualifying residential development projects. There is no further extension of the specified timeline to sell all housing units in the residential development project.

The conditions to be met for the extension of the timelines for commencement of residential development are as follows:

• The land was purchased on or before 7 May 2021; and
• The original timeline for commencement of the residential development expired on or after 1 February 2020.

The conditions to be met for extension of the timeline for completion of residential development are as follows:

• The land was purchased on or before 7 May 2021; and
• The original timeline for completion of the residential development expired on or after 1 February 2020.

For qualifying housing developers which purchased the land on or before 1 June 2020 and the original timeline for completion of the residential development expired on or after 1 February 2020, this six-month extension to the ABSD commencement and completion timelines is in addition to the cumulative 12-month extension to the ABSD commencement and completion timelines that were provided via the temporary relief measures announced on 6 May 2020 and 8 October 2020.

Qualifying developers will be granted the extension automatically. No application is necessary.

Qualifying Certificate (QC)

Under the QC regime, developers subject to the QC rules are to complete construction of all housing units in a residential development project within five years from the date of issue of the QC or the collective sale order, and dispose of all housing units within two years from the issue of Temporary Occupation Permit or Certificate of Statutory Completion.

Under the extension to the temporary relief measures, developers applying to extend their existing completion deadline will be granted a further waiver of extension charges of a total of six months. This will also apply to other SLA approvals requiring the completion of all units in the residential development. However, there is no waiver of the extension charges to extend the deadline to dispose of all housing units in the residential development project.

The conditions to be met for the waiver of extension charges to extend the completion deadline are as follows:

• The QC or SLA approval requiring the completion of all units in the residential development was issued on or before 7 May 2021; and
• The original timeline for completion of the residential development expired on or after 1 February 2020.

For cases where the QC or SLA approval requiring the completion of all units in the residential development was issued on or before 1 June 2020, this six-month extension will be in addition to the cumulative 12-month extension that was granted via the temporary relief measures announced on 6 May 2020 and 8 October 2020.

Developers which had already applied for and obtained an extension of existing completion deadlines under the temporary relief measures announced on 6 May 2020 and 8 October 2020 will automatically be granted the additional six-month waiver of extension charges, and will be notified of their new deadlines by LDAU.

If you hold a QC or other SLA approval and qualify for the concessions but have not previously applied for and obtained an extension of existing completion deadlines under the temporary relief measures announced on 6 May 2020 and 8 October 2020, we would be pleased to assist you to apply to the SLA Land Dealings Approval Unit (“LDAU”) for the concessions. Please note that applications must be made by 1 December 2021.

Commercial and Industrial development projects

Project Completion Period (PCP)

The PCP for qualifying commercial and industrial development projects on Government sale sites, or on land which was directly alienated or had their lease renewed by SLA, will be extended by six months.

The conditions to be met to qualify for the extension of the PCP are as follows:

• The land was awarded on or before 7 May 2021, or the land was directly alienated or had their lease renewed by SLA on or before 7 May 2021; and
• The original timeline for completion of the development expired on or after 1 February 2020.

For cases where the land was awarded on or before 1 June 2020, or the land was directly alienated or had their lease renewed by SLA on or before 1 June 2020, this six-month extension will be in addition to the cumulative 12-month extension that was provided via the temporary relief measures announced on 6 May 2020 and 8 October 2020.

No application is necessary as qualifying developers will be notified by the respective agencies.

Reference materials

The press release is available from the Ministry of Law website www.mlaw.gov.sg.

Further information

Allen & Gledhill has a Covid-19 Resource Centre on our website www.allenandgledhill.com that contains knowhow and materials on legal and regulatory aspects of the Covid-19 crisis.

In addition, we have a cross-disciplinary Covid-19 Legal Task Force consisting of Partners across various practice areas to provide rapid assistance. Should you have any queries, please do not hesitate to get in touch with us at covid19taskforce@allenandgledhill.com.