HDB coffeeshops are not District 10 bungalows

HDB coffeeshops are not District 10 bungalows

Here's a $23.8 million question about Singapore's most expensive coffee shop, in Hougang: How come I can still buy a cup of kopi-o there for 90 cents?

The simple answer is that, disregarding the price of the property, what goes into making that cup of coffee didn't cost much - especially not the wages of coffee shop assistants.

They are likely to belong to the bottom 20 per cent of income earners, whose incomes have stagnated over the years.

Mean-spirited though it might be, it's their meagre earnings you have to thank for your cheap beverage.

If they were paid more, like workers in Japan or Switzerland, for example, you can bet your last teh kosong that you will have to pay a lot more.

That 90-cent coffee represents one part of Singapore, perhaps the part that many of us are fond of even if we would rather not have our livelihood depend on it.

The $23 million Housing Board coffee shop, however, is another story altogether and might as well belong to a different world.

What goes into making up the sky-high price and how did it reach such a level?

When The Straits Times spoke to people in the property business last week, they cited one possible reason: the prospect of capital appreciation of the shop, which means it might sell for an even higher price in future.

If those experts are right, the buyer was prepared to pay the record price not because it made business sense in the running of a coffee shop, but because it was a good property buy which he could hope to profit from at some later date.

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