PRIME RETAIL RENTS UP 0.8% IN Q1

Rents of prime retail spaces in Singapore climbed 0.8 percent quarter-on-quarter in Q1 2014, on the back of a 3.2 percent quarter-on-quarter increase in prime rents for malls in Marina / City Hall / Bugis, revealed a Knight Frank report.

Rents of prime retail spaces in Singapore climbed 0.8 percent quarter-on-quarter in Q1 2014, on the back of a 3.2 percent quarter-on-quarter increase in prime rents for malls in Marina / City Hall / Bugis, revealed a Knight Frank report.

Notably, major retail malls Marina Square and Suntec City continued to post positive rental growth due to the Asset Enhancement Initiatives (AEIs) carried out in the two malls. With this, average rental growth for prime spaces within these malls stood at between 10 and 20 percent.

On an annual basis, prime retail rents at the Marina Centre / City Hall Bugis cluster increased by 6.0 percent.

Meanwhile, the report noted that "average prime retail rents in Jurong are among the highest across the different suburban retail mall clusters in Singapore."

Monthly gross prime retail rents of shopping malls in the Jurong cluster (comprising both Jurong West and Jurong East precincts) stood at around S$32.5 per sq ft on average, up from the average prime retail rents of S$32.30 per sq ft for suburban malls across Singapore.

Malls within this cluster – particularly Jurong East – are expected to see an increase in demand from retailers along with potential rental growth over the next few years, should the proposed Malaysia-Singapore high-speed rail (HSR) terminal be located in Jurong East Regional Centre.

Moreover, the report noted that the rental gap between the average prime retail rents in Orchard Road (Central & Fringe) and City Hall / Marina Square / Bugis clusters has been narrowing from 16.8 percent in Q4 2012 to 10.2 per cent in Q1 2014.

Given that Heeren is the only addition in Orchard Road retail belt over the past year, average monthly rents of prime spaces in Orchard Road remained relatively stable, staying close to S$36.00 psf for most established malls within the Fringe and Central parts of Orchard Road.

Going forward, Knight Frank expects average gross rents for island-wide prime retail spaces to stay firm, with potential upside of around three to five percent year-on-year by Q4 2014.


Nikki De Guzman, Junior Journalist at PropertyGuru, edited this story. To contact her about this and other stories, email nikki@propertyguru.com.sg

Source: CommercialGuru.com.sg

Date Post: 2/5/2014
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