Retail rents hit $37.78 as underperforming stores exit

Retail rents rose 0.6% even as businesses abandoned more space than they occupied in Q4.

Retail spaces in Singapore posted a 0.6% year-on-year (YoY) rent growth in the fourth quarter (Q4) of 2025, which JLL described as a slow rental cycle growth amidst a modest vacancy rate and a drop in net absorption.

The vacancy rate in Singapore rose to 1.6% in Q4, a rate that is contained as landlords prioritised occupancy amidst external uncertainties, it added.

The vacancy rate in the Suburban submarket rose 0.1 percentage points quarter-on-quarter (QoQ), caused by retail closures of underperforming stores, particularly at non-prime locations.

Prime submarket vacancy held, whilst that in the secondary market dipped during the same period.  

Softer occupier demand mixed with modest supply from asset improvements also drove island-wide vacancy rate higher QoQ, JLL said.

On a year-to-date (YTD) basis, net absorption fell 0.05 million square feet (mil sf). Net completions YTD stood at 0.05 mil sf, it added.

JLL data showed that gross rent stood at $37.78 per square foot per month (p.s.f.p.m.).

Singapore’s retail performance

Retail sales performance improved alongside a rise in discretionary spending, JLL said, a trend that was underscored by increased demand during the Formula One race and year-end festivities.

However, despite the steady recovery of the tourism market, consumer confidence remains cautious.

Demand for space across the general retail market is also currently inconsistent. Due to a difficult operating climate and evolving consumer habits, many businesses are closing or relocating to cheaper premises, leading to a general decline in demand.

High operational costs and weak consumer confidence are expected to drive retail closures and higher vacancies, though stable rent outlooks in non-discretionary sectors will help maintain capital values and steady yields, it added.

Retail outlook

Prime retail rents at Tier 1 malls are expected to climb in 2026, spurred by strong demand from international retailers that are expanding their presence in the city-state.

In Orchard and Suburban, in particular, prime retail rents are expected to grow by 1.5 to 2.5% in 2026, faster than the 1% to 2% expected in other city areas during the same year, Cushman & Wakefield said in its Singapore Market Outlook.

Retail industry groups have proposed a new “Scale-Up” programme for small and mid-sized retailers as part of their Budget 2026 recommendations, calling for targeted support to help businesses with annual revenue of $1m to $10m grow and compete more effectively.

In a joint statement, the Singapore Retailers Association and four other lifestyle trade associations and chambers announced that the proposed programme would combine capital support with access to partners, mentors, networks, and pilot opportunities.