Melbourne tops Sydney in retail rents
2015-07-21In the battle of the prime shopping strips across the world, Melbourne has emerged the winner for Australia, as being more expensive to rent a site than Sydney, in the latest CBRE survey.
The survey says there were some slight changes from the fourth quarter of 2014. Paris moved up from fourth to third, swapping places with London, while Melbourne moved up a place to seventh, exchanging positions with Sydney.
In Hong Kong, the average rent was $US4334 a square foot, New York was an average $3617 and Paris was $1320. Melbourne emerged at $710 a square foot, just pipping out Sydney at $708.
The rate rises were spurred on by the new international brands that have opened in Melbourne's Bourke Street Mall and Sydney's Pitt Street Mall. In the coming months, fast fashion group, H&M will open its flagship store in Pitt Street Mall.
According to the CBRE's global retail teams, despite the first quarter of the year traditionally being a quiet leasing period, several markets in Asia Pacific still recorded prime rental growth, including Tokyo, Melbourne, Sydney, Ho Chi Minh City, Wellington, and Manila.
But the report added that retail leasing activity in the region has weakened further as retailers became more cautious.
Dr Henry Chin, head of research, CBRE Asia Pacific, said overall, regional retail sales will remain largely stable in 2015 due to steady fundamentals such as job growth, wage growth, and demographics.
"Markets to watch include Australia, where the negative impact of the resources sector slowdown should be offset by stronger consumer, housing and export demand. CBRE expects domestic retail sales growth of around 4 per cent to 5 per cent in 2015, backed by falling energy prices, lower interest rates and the increasing wealth effect," Dr Chin said five of the top 10 most expensive prime retail markets are in Asia Pacific.
"In Melbourne, rents increased 3 per cent over the quarter, boosted by the redevelopment and renovation work in Sydney and Melbourne CBDs, which is set to provide retailers with more opportunities to expand, and to support further rental growth in the coming quarters," the CBRE report says.
Sydney also remained in the top 10 in the first quarter of 2015, although it dropped a place, to eighth. Bridge brands and luxury retailers are driving rental growth in prime locations.
For China, seen as a growth market for Australian tourism and retail sales, recent data points to slower economic growth. However, greater policy support is expected to ensure that the government meets its target of "about 7 per cent" GDP growth and 13 per cent retail sales growth. Consensus Economics estimates that retail sales growth will ease to 11.4 per cent, slightly lower than the 12 per cent achieved in 2014.
Source：http://www.smh.com.au/business/property/melbourne-tops-sydney-in-retail-rents-20150717-gie5fx
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