SYDNEY: Pitt Street Mall recorded the highest rent rises in the world over the past 12 months, with the fashion precinct's redevelopment among the likely reasons for the surge.
Global real estate firm Colliers International uncovered the rent rise in its latest Global Retail Report Spring 2010. Colliers' research revealed Pitt Street Mall's rental rates skyrocketed an average 71.43 per cent to US$8084 per sqm (AUD $9440.27).
Colliers International Director of Research Nerida Conisbee said the rate rise made Pitt Street Mall the sixth most expensive retail corridor in the world.
The top three most expensive locales are Paris' Champs Elysees (A$15,408.49 per sqm), New York's Fifth Avenue (A$15,336.14 per sqm) and Hong Kong's Russell Street at Causeway Bay (A$14,789.05 per sqm).
“Elsewhere in Australia, rents within Adelaide’s Rundle Mall rose by 7.27 per cent to US$2,650 per sqm (A$3,092.67) and Melbourne’s Bourke Street Mall remained steady at US$4,716 per sqm (A$5,502.75),” Conisbee said.
“Rents in Perth’s Hay Street and Murray Street Malls dropped slightly by just over a quarter of a per cent to US$3,189 per sqm (A$3,721.01), while Brisbane’s Queen Street Mall dropped 20 per cent to US$3,593 per sqm (A$4,193.09).”
Pitt Street Mall's redevelopment includes the building of Westfield Sydney which will cover 40,000sqm of retail space over seven levels. The first stage of the centre will open in late 2010 though the entire complex is not due for completion until 2012.
Bovis Lend Lease also redeveloped the Mid City Centre in Pitt Street Mall, creating 9000sqm of retail space. The Mid City Centre opened on June 1, 2010.
Colliers International National Director of Retail Agency, Nathan Clark, said retailers are gaining confidence to expand into markets previously viewed as too expensive or difficult to penetrate.
“The global economy is set to grow 4.2 per cent this year, according to the International Monetary Fund, helping financially healthy retailers to expand and spurring international brands to enter new markets,” Clark said.
“High-end consumers are beginning to resume their big spending ways after nearly a two year hiatus, and Australia will continue to cement itself as a major player in the global retail market.”