Savills’ latest Perth CBD Prime Retailing Report shows a tightening of retail property rental vacancies in the city.

Report author Helen Swanson said an overall vacancy rate of 7.75% was recorded in the Perth CBD prime retailing market in September 2009, a decrease from the 8.77% rate registered in April 2009.

The largest fall of all precincts was Perth’s CBD malls, where the vacancy rate fell from 10.3% in April to stand at just 2.9% as at September 2009.
“Perth’s CBD retail market has entered a new era showcasing an exciting range of new retailers and developments,” said Chris Ireland, Savills’ Perth-based National Head of Retail Services.

“Perth shoppers are no longer deprived of choice for international luxury brands with a particular focus now on Hay Street between William and King Streets attracting high profile tenants.

“Demand for prime CBD retail space is strong, which is pushing retail rents to all-time highs with rents of close to $5,000 per sq m being achieved in some parts of the CBD.

“This has driven Perth’s retail market to rents comparable with landmark eastern seaboard retail precincts, such as Queen’s Plaza in Brisbane and the Sydney CBD.”

The Savills research shows rents in the Hay Street mall currently range from $2,000 per sq m to $4,500 per sq m as at the September 2009 quarter, with rental rates rising more than 40% over the past four years.

Savills has also identified 23,600 sq m of new retail space currently under construction within the Perth CBD, all of which is due for completion by 2012 end.

Retail developments currently under construction in Perth’s CBD include Raine Square, ONE40 William and Equus.

High-profile retailers Coles and Ed Harry are among those pre-committed to new projects, with negotiations currently underway with at least 15 tenants, ranging from fashion to food, to secure space at new developments.
Savills has played a leading role in the recent evolution of Perth’s CBD retail market by securing an impressive range of high-end fashion retailers to the new $130 million Wesley Quarter redevelopment.

This tenancy mix is headlined by iconic global fashion brands Burberry and Emporio Armani, which have opened their first Perth stores at Wesley Quarter.

Savills’ Mr Ireland said Perth’s rapidly evolving retail market reflects Western Australia’s strong population growth and renewed economic impetus from the resources sector.

“Despite the global economic downturn, Access Economics predicts WA’s retail turnover is anticipated to be resilient and record 1.0% growth for 2009 and 1.9% growth for 2010,” he said.

“A new wave of resources activity in the state, highlighted by the Gorgon, Wheatstone, Scarborough and Pluto projects, have also boosted consumer confidence and have positive flow-on effects on retail spending and the local retail market.

“Major infrastructure projects such as the Link and Riverside projects will also help revitalise the Perth CBD.” 
Savills has recently expanded its specialist WA retail team with the appointment of experienced retail leasing executive Cameron Roebuck, formerly Regional Leasing Manager for Centro in WA.

For further information, please contact:

Chris Ireland
Savills National Head of Retail Services