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Orchard Road emerged as the ninth most expensive shopping location in Asia Pacific and 17th globally, according to Cushman & Wakefield’s “Main Streets Across the World 2018” report.
The property consultancy revealed that average retail rents at the iconic shopping belt rose slightly to US$308 (S$423) psf per annum in Q2 2018 compared to US$302 (S$410) psf during the same period last year.
“Rents on Orchard Road, the main street in Singapore, have stabilised after softening in 2017 and are expected to bounce back by the end of 2018,” said Cushman.
“Rents in more suburban locations meanwhile have continued to edge higher, driven by large residential catchments and the high frequency of shopping trips. Overall, the retail market is benefiting from strong tourist numbers, a tight labour market and improved consumer sentiment, combined with a shortage of supply.”
The consultancy also noted that online retailers are taking up physical space to improve brand awareness, while landlords are seeking other occupants like co-working space operators and activity-based retailers, but eateries continue to be the primary demand driver for retail space.
Nonetheless, Cushman thinks that the outlook for Singapore’s retail property market is rosy.
“The wider economy and the tourism sector are expected to remain buoyant over the next twelve months, which should filter through to the property market. However, rental growth will be strongest in well-located and well-managed spaces, which are able to attract consistently high footfall.”
Meanwhile, Hong Kong’s Causeway Bay topped the list with average rents of US$2,671 psf per year. It surpassed New York’s Upper 5th Avenue (US$2,250 psf), which previously held the number one spot in 2017.
Completing the global top five are London’s New Bond Street (US$1,744 psf), Avenue des Champs Elysees in Paris (US$1,519 psf) and Milan’s Via Montenapoleone (US$1,466).
In Asia Pacific, the top five comprises Hong Kong’s Causeway Bay, Tokyo’s Ginza (US$1,219 psf), Pit Street Mall in Sydney (US$964), Seoul’s Myeong-dong (US$908 psf) and Wangfujing in Beijing (US$492).
Romesh Navaratnarajah, Senior Editor at PropertyGuru, edited this story. To contact him about this or other stories, email romesh@propertyguru.com.sg
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