Commercial property firm Colliers offers a rundown of future leasing trends nationwide.
Sydney CBD
According to Colliers, the average Sydney CBD gross face rents are forecast to increase to 1.9% to $10,966 per sqm by the first quarter of 2018. Sydney CBD retail floor space supply will peak at almost 80,000 sqm in 2020 due to the refurbishment of Harbourside Shopping Centre.
The Sydney CBD office market is in the midst of a significant development phase that commenced with Barangaroo in 2015 and will continue out to 2021 and beyond with projects from Brookfield, AMP and Lendlease. As these projects reach completion, it is clear that the standard of retail on offer is being improved, with Sydney consumers reaping the rewards in the form of laneway activation, new brands and more sophisticated dining experiences.
Melbourne CBD
In Melbourne, offshore purchaser interest continues to strengthen, with tenant demand for central locations driving up prime face rents with limited prime grade support volumes. Changing demands of the consumer in the fashion world has seen a shift particularly in choice towards casual sportswear. The rise in popularity of active wear has not only put pressure on retailers to create a segment of sport apparel but struck as a game changer in the footwear industry.
Brisbane CBD
In Brisbane, prime grade high street retail gross face rents head northward, placing the Brisbane CBD as the third most expensive region across Australia. Improved business conditions, strong population growth and record tourism numbers are assisting retail trade turnover across the South East. Strong population growth along with increased tourism numbers is driving rents in Brisbane’s CBD and assisting retail trade within the city’s centre.
Adelaide
South Australia has seen sustained growth in retail sales, with vacancy on Rundle Mall falling. Sales activity is primarily driven by private investors. Retail sales have primarily been driven by strong growth in Café and restaurants, Food and other retail categories.
Perth
Major centres in Perth are undertaking works to reposition assets, with CBD rents adjusting as demand softens. Over the next decade Perth’s retail sectors landscape could look distinctly different than it does today. The creation of ‘destination’ complexes by larger shopping centres poses significant risks to less significant centres.