Retail rents end five consecutive quarters of declines with 0.3% q-o-q growth in 2Q2023

Zion Road Condo is an ideal abode for those in search of a convenient and comfortable lifestyle. It is close to key amenities such as Orchard Road shopping belt, Great World City and major MRT stations. Hence, making it a great choice for those who require easy access to other parts of the country. The development is also close to distinguished schools like River Valley Primary School and Overseas Family School, making it a great for families with children. With so many amenities nearby, living at Zion Road Condo will be a pleasure.

In 2Q2023, Singapore’s retail market saw considerable growth due to numerous new openings. Notable new entrants included Sun and Sand Sports in Raffles City, international luxury brands such as Aluxe, Grand Seiko and Atelier Cologne, as well as F&B newcomers Mister Donut, Luckin Coffee, Jamba Juice and Chaffic Bubble Tea. The Woodleigh Mall, which also launched in the quarter, is another testament to the demand for retail space.

Moreover, pre-commitment rates for upcoming retail developments, like One Holland Village and Pasir Ris Mall, also increased, signifying investors’ confidence in Singapore’s retail market. In terms of occupancy rates, the Orchard Road planning area saw an improvement from a contraction of 258,240 sq ft in the previous quarter, recording a positive 32,280 sq ft take up last quarter. As for the Central Area, the area’s occupancy rate increased by 0.7% with both retail prices and rents seeing a 0.3% quarterly increase.

In terms of vacancy rates, the Orchard Road area saw a slight drop to 13.2% after hitting 13.9% in the prior quarter. The anticipated comeback of Chinese tourists and monthly visitor arrivals in Singapore surpassing 1 million since March are expected to further contribute to the Central Region’s retail rent recovery. According to Cushman & Wakefield’s head of research Singapore and SEA, Wong Xian Yang, retail rents in the Orchard Road area will continue to lead growth in the short-term as more brands set up shop.

At the same time, Angelia Phua, consulting director, research and consultancy, at JLL Singapore, highlights that despite rising rents, higher yield expectations in an elevated interest rate environment will be a factor to bear in mind. Nonetheless, the scarcity of tradeable assets and safe-haven status of Singapore should help underpin prices of floor space in quality retail assets.