The property types
"Commercial" usually means office space, retail units, or shophouses (which can carry a mix of commercial and residential use depending on the specific title). "Industrial" is zoned B1 (light/clean industrial, permitted near residential areas since it's low in noise and pollution) or B2 (general/heavy industrial, needing more buffer distance from housing) — think workshops, warehouses and logistics space.
What's structurally different from residential
| Residential | Commercial / Industrial | |
|---|---|---|
| ABSD | Applies from the 2nd property, scales with citizenship | Does not apply, regardless of how many properties you own |
| CPF usage | Allowed, subject to Valuation/Withdrawal Limits | Not allowed at all — cash or bank financing only |
| GST | Not applicable (residential sales are GST-exempt) | 9% GST typically applies if buying from a GST-registered seller (e.g. a developer); resale from a non-GST-registered individual usually doesn't attract it |
| Financing | Bank or HDB loan, LTV rules tied to loan tenure/age | Bank loan only, commonly up to 80% LTV for individual buyers, assessed against the unit's income-producing potential |
GST and financing details vary by transaction structure (individual vs. company purchase, GST-registration status of both parties) — verify your specific situation with IRAS and your bank before relying on these figures.
Zoning and eligibility for industrial property
Industrial space isn't simply "buy and use however you like" — B1 and B2 zoning determines what activities are permitted on the site, and some industrial developments (particularly those on JTC-related land) carry additional conditions on who can occupy the unit, tied to genuine industrial use rather than pure investment holding. Always check the specific property's permitted use and any occupancy conditions before committing, especially for older industrial estates.
Which situation fits you?
- Buying for your own business use: zoning and permitted-use conditions matter more than yield — confirm the unit supports your actual operations before anything else.
- Buying an office/retail/shophouse as an investor: no ABSD or CPF usage changes your holding-cost math compared to residential — worth running the numbers properly rather than assuming residential rules apply.
- Considering a new industrial unit from a developer: factor GST into your upfront cash requirement, and check if you can register for GST to recover it.
Tenure — freehold vs 99-year leasehold — applies here too, and matters for financing and exit value the same way it does for residential. That's covered separately; happy to walk you through it when we talk.
Get guidance for your purchase
Tell me a little about what you're looking at and I'll help work through zoning, GST and financing specifics for your situation.