Average excellent retail housing costs in Singapore continued all their downward craze in the second quarter, with those on Orchard Route falling using a bigger quota than those of suburban centers, according to a home consultancy within a press release produced on Thurs ..
Average excellent rents pertaining to the high end sub-market chop down 0. six per cent from first fraction of 2016 to S$29. 45 every square base per month. Normal prime Orchard Road housing costs slipped 1 ) 1 % from Q1 to S$32. 50 psf/pm.
This notable the 6th consecutive fraction of diminish for Orchard Road seeing that Q4 2014. Average excellent suburban rents have also mirrored the trend with figures declining since the last quarter of 2015.
For a year-on-year comparison, rent prices for Orchard Road fell 4. 4 per cent from S$34 psf/pm the same quarter a year ago while suburban rent prices fell 2 . 8 per cent from S$30. 30 psf/pm in the same quarter a year earlier.
An analyst said that the research shows a clear reduction of rentals and it would not be accurate to report otherwise, as the retail sector is still undergoing restructuring and is currently an occupiers’ market.
He added that while rents remain under pressure, there are still sparks of activity around well-located and well-managed suburban malls such as Compass One, which recently reported 90 per cent pre-commitment.
Using the strong showing from returning tenants following the reopening of Compass One as an example, malls which are located near transport nodes, have a good tenant mix and provide the guarantee of a day and night catchment will continue to be more resilient in terms of rents and occupancy in the current market conditions.
While general vacancy has been rising and more retail stock can be expected, the of excellent space on good spots is hard to find. This has deterred the enlargement and obtain of a few retail labels as site, visibility and high footfall have become more importantly factors than due to serious competition from the market.
Lacking foreseeable innovative supply on Orchard Roads and Yacht club Centre next few years, for least until finally 2019, really should provide a few support pertaining to prime housing costs in Orchard Road for half of the season.
The market is specially challenged using a mismatch of demand and gives at this point during the cycle. Alot of of the restricts to enlargement stem out of consolidation activity, there are some sellers who are actually constrained by shortage of level of quality space.