Rents for retail spaces predicted to trickle up by 2%

Good thing is that there's high-prelease rates.

According to DBS, in the retial space scene, there is an increasing tug of war between domestic demand and rising costs. 

On the one hand, a surfeit of new-to-market brand offerings and decentralising high street names to garner more market share, ensures a fairly vibrant retail scene, on the other, rising costs are forcing retailers to re-take stock of medium term expansion plans.

Here's more from DBS:

We expect retail rents to trickle up by 2% this year; high pre-commitment rates in 2H13 should stabilise rents, while the large incoming supply, to the tune of c10% of total inventory till 2017, largely in the fringe areas, may cap
near term upside.

Cap rates of 4.7-5% have compressed from 2009 levels, supported by rising income and are comparable to yield on cost for retail developments.

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