HOW 26 RIDOUT ROAD CAME TO BE RENTED: SHANMUGAM
Mr Shanmugam first rented 26 Ridout Road in 2018 and renewed his lease three years later.
Addressing the flurry of questions that have been raised over his tenancy of the state property, the minister said: “Many will appreciate that the choice of a person’s home is typically a personal and private matter.
“But I am mindful that as an elected official whose authority is conferred on me by the trust of Singaporeans, the lines between what is personal and public may not always be clear. So, I will speak of them.”
Explaining why he was living in a rented home, Mr. Shanmugam said he had decided to put his family home – a good class bungalow where he was living before June 2018 – up for sale.
This came after a review of his finances in 2016, where he realized that “too much of (his) savings” were tied up in his family property which he had bought using his previous income as a lawyer.
“When I bought my family home, I had assumed a future stream of income based on what I was earning in the private sector. After I became a minister, my income changed, and thus I found too much of my savings was tied up in one house,” he said.
“I was advised that it would be wiser not to have the most of one’s savings in one asset. So I decided to put my family home for sale.”
To prepare for the sale, Mr. Shanmugam said he decided to move out and live in a rental property. After looking at several rental options, including black-and-white houses which he had “long liked”, he decided to make an offer for 26 Ridout Road in 2018.
The offer, made on the back of advice from his property agent, was S$25,000 (US$18,500) a month. He said he was advised that this would be a “fair offer” based on rentals for similar properties at that time, while taking into account the built-up area and the condition of the property.
The Singapore Land Authority (SLA) then came back with a counter-offer of S$26,500, which the minister said he “accepted without further negotiations”.
“I had no idea, when I accepted SLA’s counter-offer, what was the guide rent or the minimum rent was. These were decisions internal to SLA that I wasn’t privileged to,” he added.
Mr Teo, who delivered a separate ministerial statement on Monday, said the SLA valuer who reviewed the guide rent of 26 Ridout Road did not know the identity of the prospective tenant, and only learned that the tenant was Mr Shanmugam after the matter was reported in the media.
They also did not know about the rental amount that SLA’s leasing division had negotiated with the tenant, he added.