Large format space to surge by 2020
According to the property firms latest retail report, 270,000sqm of large format retail space is due to be completed in 2016, with 66000sqm brought to market in the second quarter alone.
CBRE cited sustained sales growth in large format retailing for its positive assessment, which it says is driving demand from brands and investors.
Chris Parry, CBRE’s Australian head of large format retail, says that the strong sales have driven retailer confidence, opening the doors for local and international groups looking for expansion opportunities.
“Despite the strong supply predictions, we expect vacancy rates to stay low and support rent growth – as retailer competition remains heated in the sector,” he said.
“For a long time new supply was dominated by hardware, with little or no specialty floorspace, which has fuelled an under-supply of multi-tenanted large format floorspaces.”
“Developments currently under construction – including Marsden Park and Camden Valley Way in NSW, Kingston Central Plaza in VIC and North Lakes Large Format in QLD – which should bring over 55,000sqm of stock to the market by early 2017 and give both new and existing retailers opportunities to expand,” he added.
The report also identified the role of non-traditional retailers in diversifying the retailer mix in traditional homemaker centres as part of a move designed to drive foot traffic.
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