Clarification regarding MUIS's management of wakaf properties

We understand public concerns about heritage businesses and rental practices for wakaf properties.

Wakaf and the income generated are firstly managed according to the deed (or intentions) of the wakif (donor).

The one who manages the wakaf has the amanah (trust) to operate the wakaf according to the deed and ensure the benefits generated by the wakaf (such as the use of the property and the income generated) reaches its stated beneficiaries. In other words, these beneficiaries such as mosques, madrasahs, needy descendants and charities identified by the wakif have a right to the income generated.

In Singapore, these principles of managing such wakafs are outlined in the Administration of Muslim Law Act (AMLA). Wakafs are managed by mutawallis (trustees) or MUIS (a role that MUIS's subsidiary, Warees Investments Pte Ltd, performs on our behalf). For mutawallis, MUIS ensures they are screened and approved by MUIS Council before being appointed. The mutawallis must also comply with strict AMLA requirements including submitting audited financial statements of the wakaf property.

As stated in AMLA, MUIS is responsible for making sure wakaf properties are well-managed so they can keep generating income for the people they are meant to support, as specified in each wakaf deed. To do this effectively, mutawallis ensure their wakaf properties are regularly maintained and rented out at rates you'd expect to pay in the regular property market.

The key idea is that whomsoever manages a wakaf property has a fiduciary responsibility (a legal and ethical responsibility) to act in the best interest of the beneficiaries of the wakaf as stated in the original wakaf deed. If the rental rates were set substantially below market norms, the mutawallis could be accused of failing to perform their fiduciary role and short-changing the beneficiaries of the charitable income intended for them by the wakaf deed.

By keeping rents at market levels, MUIS and mutawallis ensures these religious endowments can continue supporting their intended causes sustainably and according to the specific terms set out in each wakaf's deed.

We recognise that businesses today face significant challenges including manpower shortages, rising costs, marketing difficulties, evolving consumer preferences, and intense competition. When tenants face difficulties meeting rent payments, MUIS engages them through Warees to understand their financial situation and may explore repayment plans. 

Despite these flexible arrangements and support measures, we acknowledge that some businesses may still be unable to continue operations due to broader market conditions and business viability challenges beyond rental considerations alone. Mutually agreed termination of leases or legal proceedings are only pursued as a last resort, in accordance with tenancy agreement terms. This approach balances MUIS's responsibility to ensure wakaf properties generate sustainable income for beneficiaries with compassionate tenant management.

For wakaf properties in heritage districts like Kampong Gelam, MUIS and Warees work with relevant agencies to ensure that they are carefully maintained, restored and revitalised to sustain their heritage value and, where relevant, that tenants of wakaf properties are in line with the identity of the district. In addition, heritage businesses housed in wakaf properties in the historic districts may also benefit from support offered by National Heritage Board.