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The next-generation foreign workers’ dormitory

Charlene Chin, Cecilia Chow

SINGAPORE (EDGEPROP) - In recent weeks, the harsh glare of the spotlight has been cast on Singapore’s foreign workers’ dormitories, where there are 16,393 out of 18,778 Covid-19 cases, as at May 4. “We are doing all we can to control the serious outbreak amongst migrant workers in the dormitories, and to take care of these workers,” said Minister Lawrence Wong, co-chair of the Multi-Ministry Taskforce on Covid-19, in Parliament on May 4.

The infections among the migrant workers are mostly concentrated amongst workers in the construction sector (Photo: Samuel Isaac Chua/EdgeProp Singapore)

The infections among the migrant workers are “mostly concentrated amongst workers in the construction sector”, adds Wong. “We now know that the transmission amongst this group has been happening for some time, and occurred not just in the dormitories, but also in common work sites and in places that they went to with their friends after work and on their rest days.”

That explains the clusters outside of the dormitories — among construction workers living in shophouses and private apartments too, says Wong.

Construction workers who are work permit holders totalled 293,300 as at December 2019, according to the Department of Statistics. That is bigger than the population of Singapore’s biggest planning area, Bedok, which has 279,380 residents as of 2019.

The total population of foreign work permit holders living in dormitories is 323,000. There are 43 purpose-built dormitories (PBDs), which house 3,000 to 25,000 workers each. Out of the 43 PBDs, 25 have been gazetted as isolation areas, according to the Ministry of Manpower (MOM). The biggest cluster is at S11 Dormitory at Punggol, with more than 2,400 cases as at April 30. The second highest cluster of infections is at Tuas View Dormitory, which has over 1,000 reported cases as at May 4.

The biggest cluster of infections is at S11 Dormitory in Punggol (Photo: Albert Chua/EdgeProp Singapore) 

Design and living space in today’s dorms

“How do we prevent this from happening again?” asks Wong. “We will have to work with the industry to fundamentally change the way we go about construction activities — we will need a whole range of measures covering the worksites, the accommodation and transport of workers, as well as additional precautions taken by the workers themselves.”

According to Shamkumar Subramani, CEO of TS Group, the co-owner and operator of Tuas View, the high rate of infections in these dormitories is “largely due to the current design and proximity” of the living spaces.

Under the existing URA guidelines for independent workers’ dormitories, updated on April 13, the minimum living space per worker is 4.5 sq m (48.4 sq ft). This is less than half the size of a parking space which is 11.52 sq m (2.4m x 4.8m), points out Nicholas Mak, head of research & consultancy at ERA Realty.

“Typically, dormitory rooms will house 12 to 20 workers,” says Steven Tan, Colliers International’s senior director for capital markets. “So a 20-worker room will have a minimum floor area of 90 sq m.” That is the size of the average four-room HDB flat which has three bedrooms. Since May 15, 2017, the maximum number of sub-tenants allowed in a four-room or larger flat is nine.

Shamkumar: Managing the Covid-19 outbreak in these dormitories is a great challenge. I think we have to look at the design holistically (Photo: TS Group)

The two biggest PBDs are Sungei Tengah Lodge with 25,000 beds and Tuas View with 16,800 beds.

Besides PBDs, there are about 700 non-PBDs, such as factory-converted dormitories or ancillary dormitories within industrial or warehouse developments, as well as temporary quarters at construction sites. The ancillary dormitories are usually reserved for foreign workers who are employed to work in these factories and usually house fewer workers compared to the PBDs, notes Mak.

In his April 20 report, Credit Suisse analyst Gerald Wong estimates that about 200,000 workers are housed within the PBDs, while another 95,000 workers live in the converted dormitories, with most housing 50 to 100 workers, and some, up to 500 workers.

Many of the dormitories are located in the outer reaches of Singapore, close to manufacturing or industrial areas, such as Boon Lay, Jurong, Senoko and Tuas in the west, Changi in the east and Woodlands in the north, observes ERA’s Mak.

Tuas View has minimarts, dedicated cooking areas, central laundry and recreational facilities such as outdoor games courts and a gym

Tuas View set the benchmark for the new generation of PBDs when it opened in 2016. The dormitory includes amenities such as minimarts, dedicated cooking areas, central services such as laundry and remittances as well as recreational facilities including outdoor games courts and a gym.

What could change?

The government is looking at revamping the dormitories. “This is a good thing,” says Shamkumar. “Managing the Covid-19 outbreak in these dormitories is a great challenge. I think we have to look at the design holistically.”

Beyond design, issues such as liveable space, social and cultural aspects have to be taken into consideration too. After all, the dormitories house workers from many different countries, such as Bangladesh, China, and India.

Improving the liveable space could include increasing the minimum living area per worker from the current 4.5 sq m. The number of workers per room could also be capped at eight to 10. Instead of communal toilet facilities, en suite shower and toilet facilities could be a requirement for future dormitories. The ratio of workers to shower and toilet facilities could also be reduced to five, from six to nine workers currently.

A typical sleeping space of a workers' dormitory with bunk beds (Photo: Samuel Isaac Chua/EdgeProp Singapore)

After Covid-19, the business model of “barracks-style” workers’ dormitories could move towards more “apartment-style” accommodation, with smaller rooms and attached bathrooms, each housing six to eight workers, says Colliers’ Tan.

To prevent future outbreaks from spreading like wildfire among residents, the capacity of new PBD projects could be limited to 5,000 beds.

“That means mega dorms will not be on the cards in the future,” says Shamkumar. “In terms of design, it will still be about communal living, but the limit will be 5,000 to control the amount of interaction.”

Pioneer Lodge — last of the mega dorms or first of the new-gen dorms?

At a pivotal point right now is Pioneer Lodge, a PBD with 10,500 beds, where construction has already started. Shamkumar’s TS Group and listed construction and property group, Wee Hur Holdings, had won the site at Soon Lee Road in Jurong in a tender last September.

To prevent future outbreaks from spreading like wildfire among residents, the capacity of new PBD projects could be limited to 5,000 beds (Photo: Samuel Isaac Chua/EdgeProp Singapore)

The 75:25 joint venture between Wee Hur and TS Group, respectively, was awarded the site for Pioneer Lodge based on a monthly rent of $724,500 and BCA’s administration fee of $58,500 a month. The lease on the land is for three years from October 2019 to September 2022, with the option to renew for another 3+3 years.

The nine-year lease (3+3+3 years) for a PBD site includes the construction period, which generally takes a year, says Shamkumar. Pioneer Lodge was scheduled to be partially operational by 2H2020 and fully operational by 1H2021, according to Wee Hur’s 2019 annual report. However, construction works have ceased due to the Covid-19 outbreak.

Pioneer Lodge was designed under the existing URA guidelines for PBDs, and the bid was made based on the 10,500-bed capacity and nine-year lease term. If the capacity is halved to 5,000 beds, the rent on the land will have to be reduced or the lease extended to make it feasible to operate, says Shamkumar.

The question facing the developer and operator of Pioneer Lodge is: Will it be the one to set the new standard for future dormitories or will it be the last of the mega dormitories to be built under existing PBD guidelines? “There are many moving parts to this,” says Shamkumar. “We need to sit down and discuss it with the authorities.”

Cost is a major consideration as it will be passed on to the companies who are paying for the bed spaces of their. workers at the dormitories (Photo: Samuel Isaac Chua/EdgeProp Singapore)

Cost is a major consideration, says Colliers’ Tan. “The cost of running an apartment-style dormitory will be higher due to the increased provision of infrastructure and more R&M [repair and maintenance] works required,” he adds. “This higher cost will in turn be passed on to companies paying higher rates per bed space. The operators will have to recalibrate the optimal balance of the number of workers in each room and the cost per bed space, moving on.”

For instance, at the end of 2019, Tuas View had an occupancy rate of about 80%, according to Wee Hur’s annual report. The rental rate for a space at Tuas View is in the range of $250 to $300 a month. “The rate has recovered by 5% to 10% over the past three to four years due to improvement in construction and other sectors, but it has not been significant,” says Shamkumar.

Consolidation among operators

However, consolidation could take place in the workers’ dormitory sector, with fewer operators left in the game, says Shamkumar. “We foresee some employers possibly defaulting on their rental,” he says. “We are seeing indications of that already. If you’re one of those operators that depend on the cash flow from the monthly rents, you may not survive. But if you have deep pockets and you’re able to weather this Covid-19, you will be one of those left standing.”

Demand for bed spaces in workers’ dormitories will remain strong, as it is primarily driven by the construction industry, notes Colliers’ Tan. “In the short to medium term,  construction sector growth is backed by the large volume of en bloc transactions made in 2017 and 2018 which are likely to be redeveloped by 2023–2024,” he says. “In the longer term, construction sector growth will be supported by the transport sector, which currently has 75 projects in the pipeline such as the North-South Corridor, Thomson-East Coast Line, Tuas Mega Port and Changi Terminal 5 and more to be rolled out progressively from now till 2040.”

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