Retail property market cools over Q3

Property firm Cushman & Wakefield has noted $2.1 billion total investment volume in retail properties over the third quarter of 2018 – a 7 per cent drop quarter over quarter.

The firm’s Australian Retail Investments Spring 2018 report found that NSW topped investment volume for the quarter, recording 69 per cent of total investment, or $1.5 billion.

Queensland investment volume ranked second, contributing $431 million, while Victoria ranked third at $98 million, significantly below the $1.6 billion it recorded in the second quarter.

“The retail sector continues to adjust to major changes as demanded by consumer preferences,” the report reads.

“This quarter, significant amendments were made to the land use definitions… supporting both retailers and landlords alike. A new definition, ‘Specialised Retail Premises’ was introduced…allowing landlords to reposition their tenant mix to meet consumer preferences for a one-stop retail experience.”

Larger format supermarkets such as Woolworths and Coles have taken note of the trend toward smaller format stores, particularly in high density metro locations where customers tend to shop more often, and with smaller basket sizes, according to the report.

Cushman & Wakefield is forecasting annual investment volume to reach $7.5 billion to $8 billion, a 15 to 20 per cent reduction compared to 2017.

This forecast is backed up by the NAB Commercial Property Survey Q3 2018, which noted that sentiment had remained flat or fallen across all sectors, with retail sentiment in particular diving further into negative territory.

Retail sentiment is forecasted to fall further over the next 12 months, according to NAB, which posits that it could fall as low as 37 points below the base line, currently sitting at -20.

“Clearly, a subdued outlook for retail trade is playing a role, with NAB also expecting the retail trade sector to remain under pressure from weak wages, cost of living concerns and wealth impacts from a cooling housing market,” NAB’s report explains.

Access exclusive analysis, locked news and reports with Inside Retail Weekly. Subscribe today and get our premium print publication delivered to your door every week.

Comments

Comment Manually

I have read and agree to the Terms and Conditions and Privacy Policy.

This site uses Akismet to reduce spam. Learn how your comment data is processed.

Inside Retail Polls

How have private-label products impacted your business?
Vote

Twitter

The shock @LiberalAus victory over the weekend could be good news for Australia's retail industry #retail #auspol https://t.co/qFvHayoF2Q

1 week ago

A new initiative, announced by @google at #CopenhagenFashionSummit,will help to understand the environmental impact… https://t.co/VmLrRHHp3p

2 weeks ago

Rising competition and crude oil prices have impacted @CaltexAustralia net profits in the first quarter of 2019… https://t.co/OE4VaIIReR

2 weeks ago
x

SUBSCRIBE
FREE NEWS BRIEFS Get breaking news delivered