Limited ground floor space and high rents in the Sydney city fringe are seeing a fresh wave of landlords take charge and follow in the footsteps of the traditional shopping centre model, and ‘go up’ with their retail offering.
Counteracting the shortage of retail space
Many landlords are seeking new alternatives to counteract the shortage of available retail space in Sydney’s city fringes and ‘vertical retailing’ is the most cost effective solution.
Since the emergence of the shopping centre model, we are seeing vertical retailing ‘popping up’ everywhere, especially in smaller scale assets in the city fringe.
Ensuring foot traffic to all levels is critical, as getting people to go all the way to the top floor can be quite a challenge, at times. For tenants, rents on higher floors are lower, making what is known as vertical retailing more cost-efficient from a tenant’s point of view.
4,6,8 Australia Street, Camperdown NSW
Planning to capitalise on this trend is a local private investor who is selling his inner city freestanding warehouse with value-add potential in Camperdown.
The prominent, two level freestanding office building totals 1811sq m (approx.) including parking with over 42 metres of street frontage.
Located at 4, 6, 8 Australia Street, the property is fully leased with a net annual income of $500,000pa (approx.) with three tenancies offering diverse income stream and substantial rental growth. The property is also strategically located approximately 800m to Sydney University, 1km to Royal Prince Alfred Hospital and 3.8km to Sydney CBD.
This is an exceptional landholding over three lots with flexible floor plates, allowing for repositioning, future strata sub-division and mixed-use development (STCA).
The property is set to benefit from $16.8 billion being spent on infrastructure upgrades to Westconnex and flexible B2 zoning allowing for residential, hotel, office, student accommodation & mixed-use developments within the immediate precinct.
The Parramatta Road Corridor project has the potential to transfer Parramatta Road into public transport friendly and commercial/retail hub connecting the CBD to the Inner West and beyond.
4,6,8 Australia Street, Camperdown is For Sale via Expression of Interest through Savills Australia, closing Wednesday 8 May 2019 closing at 4:00pm (AEDT).
Vertical retail trend growing throughout Asia
The vertical retailing trend is spreading around the world in all major retail markets but in particular Asia with countries like Hong Kong, China, Malaysia and Singapore, due to limited ground floor space in prime location and increasing rentals.
This is one trend that is not going anywhere. The demand is most definitely still there as we are now seeing larger, multi-level stores taking on 1,000 square metres instead of the usual 400 square metres.
If anything, as space continues to be in demand, we can expect to see a lot more of this popping up in the near future.