High rent at North Spine Plaza leaves stores high and dry

By Wong Jinghui and Eleanor Tay

Convenience store Buzz (right) has been closed since last January. Beside it stands hair salon K-Cuts (left), which has tried requesting for a slash in rent during the holidays. PHOTO: ZHENG JUNCEN

Convenience store Buzz (right) has been closed since last January. Beside it stands hair salon K-Cuts (left), which has tried requesting for a slash in rent during the holidays. PHOTO: ZHENG JUNCEN

A combination of high rental and poor business during the semester holidays is threatening to put some stores in the North Spine Plaza out of business.

Some tenants have complained of the high monthly rent — ranging from $3,000 to $10,000 a month — at the University’s North Spine Plaza, and the fall in foot traffic during the semester break.

As part of the newly revamped North Spine, the North Spine Plaza was touted as a lifestyle hub when it first opened in late 2015, offering 24 food and retail options over two floors. Food and beverage outlets and retail outlets occupy the lower floor, while communal study spaces are located on the upper floor.

However, things have slowed down since its opening.

Currently four store spaces in North Spine Plaza are empty, with convenience store Buzz closing last January. Bakery Temptations shut in June last year reportedly due to poor business, with no new tenant taking its place yet.

Rental woes

The head chef and restaurant manager of Mia Pizza & Pasta Express, who only wanted to be known as Mr Khairul, said his restaurant could not make a substantial profit with its high monthly rent of $10,000, coupled with labour and utility bills.

“If I take the average sales of around $1,500 on a normal day, in a month, my profits are just enough for my costs. So basically, I’m not earning anything.”

Earnings can go down to around $500 a day during the semester break, added Mr. Khairul.

“Business during the holidays is totally not enough to cover the rent. While we can still break even for the entire year, we have to push harder for business and pray to God that there’s more people around.”

His sentiments were echoed by Mr Edwin Chan, managing director of the takeaway food kiosk, The Sandwich Guys. Mr Chan called for a slash in monthly rental during the semester break.

“During the holidays, more than half of the population is gone. If the rate drops accordingly, we will be more profitable because we will be able to have longer opening hours and lower our prices,” said Mr Chan.

His store typically sees 160 receipts a day during the semester, but this drops to just 70 receipts a day once semester break starts.

Ms Jessy Chan, an employee of hair salon K-Cuts, said: “North Spine Plaza is super quiet during the long breaks. It was so quiet last summer break that all we could do was to sit and look at each other.”

“Since human traffic falls so much during the holidays, why shouldn’t the rent be cut? This place will be empty in three years with such high rent,” she added.

Despite only being around for a year, Mia Pizza & Pasta Express is struggling to keep its head afloat due to high monthly rental and poor sales. PHOTO: WONG JINGHUI

Despite only being around for a year, Mia Pizza & Pasta Express is struggling to keep its head afloat due to high monthly rental and poor sales. PHOTO: WONG JINGHUI

Unsuccessful efforts

Some tenants say efforts to negotiate with the University have been unsuccessful.

Ms Chan said her employer’s request to slash the rent during the holidays was turned down, while Mr Khairul said his attempts at approaching the school’s leasing office were fruitless.

He added: “Sorry to say but they didn’t put in any effort in addressing the concerns we gave. The least they could do was to send an email on our behalf, but they just said they couldn’t help us.”

With two more years to go on their contracts with NTU, both Mr Khairul of Mia Pizza & Pasta Express, as well as Mr Chan of The Sandwich Guys, said they were uncertain if they would stay on after their contracts expired.

Mr Chan said: “We’ll try our best but it depends on whether our business can be sustained. If we continue the contract, we are locking ourselves out.”

Biting the dust

As some tenants contemplate their future in North Spine Plaza, others like donut chain Dunkin’ Donuts have bitten the dust.

Ms Fardiana Mohd Ali, senior outlet manager of Dunkin’ Donuts, said they have ended their contract prematurely due to poor sales. The store will shift out once a replacement tenant has been found.

“Even if business was normal, we still couldn’t earn enough to pay the monthly rent,” said Ms Fardiana, adding that sales would drop by 80 per cent during the semester break. It cost an estimated $20,000 to operate the outlet every month, she said.

In response to queries from The Nanyang Chronicle, Chief Housing & Auxiliary Services Officer Jimmy Lee said: “Although contractual details cannot be disclosed for confidentiality reasons, rental rates are on par with those of other education institutions.

“Potential tenants are informed of the University’s annual vacation periods beforehand, and would have taken this into consideration in their tender bids.”

Mr Lee added that the Housing and Auxiliary Services Office is currently working to find new tenants to enhance the North Spine Plaza’s retail mix.

Although Temptations Bakery has been closed since June last year, no new tenant has moved into its space yet. PHOTO: ZHENG JUNCEN

Although Temptations Bakery has been closed since June last year, no new tenant has moved into its space yet. PHOTO: ZHENG JUNCEN

More variety, more services

Students interviewed by the Chronicle expressed a desire for a greater variety of stores in the Plaza.
Some suggestions included bringing in a bookstore — as the nearest one is located at South Spine — and popular Japanese food franchise Maki-San.

Fourth-year School of Computer Science and Engineering student Samuel Lee felt that the North Spine Plaza could offer more distinct services, instead of adding more food and beverage outlets.

The 25-year-old said: “We already have a lot of choices for food, so I don’t think adding more food outlets is needed.

“Maybe the Buzz convenience store can be replaced by a convenience store that actually opens 24 hours a day. This would benefit the halls nearby.”