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The number of vacant retail space in Orchard Road increased on a quarterly basis in Q1 2015, according to a report from Maybank Kim Eng.
Due to strong supply in the downtown core area, vacancy rate at Singapore’s famous shopping belt rose from 5.6 percent to 7.2 percent during the first quarter as net absorption plummeted to nearly -3 percent from 8 percent in Q4 2014.
Consequently, retail rents at Orchard Road dipped by 1.6 percent in Q1 2015 compared to the previous quarter.
“We continue to expect retail weakness as visitor arrivals could continue to face headwinds from currency effects, making Singapore an expensive destination, while making rival destinations like Japan cheaper,” it said.
“Structural issues of labour crunch and weak economic growth continue to have a negative effect as well,” added Maybank’s investment banking arm.
Nikki De Guzman, Editor at CommercialGuru, wrote this story. To contact her about this or other stories email nikki@propertyguru.com.sg
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