SG retail market recovery momentum hit by heightened alerts
Islandwide prime retail rents saw a dip by 0.6% q-o-q.
The Singapore retail market saw a halt in its recovery due to heightened alerts, according to a report released by CBRE.
Thus retail sales remained soft q-o-q , with the report pointing to department stores, watches & jewellery and wearing apparel & footwear as the most affected.
Pedder on Scotts, a 20,000 sq. ft. store in Orchard Road was the most recent casualty, closing shop on late September.
The F&B industry also experienced a similar disruption due to the prohibition of dine in and reduction of social group sizes to two. However new openings and expansions kept the industry healthy. New tenants were also brought in by landlords to refresh their tenant mix, some of which were activity-based tenants, supermarkets with niche concepts and online-to-offline fashion retailers.
Islandwide prime retail saw a 0.6% dip q-o-q in Q3 2021, due to pressure on the submarkets from work-from-home measures and weak travel demand. This was slightly higher than the -0.4% q-o-q in Q2 2021. Prime rents also continued to register healthy reversionary rents due to the high demand for quality suburban retail spaces. Secondary floors and areas, however, were challenged due to the impact on overall tenant sales.
Y-o-y, islandwide prime rents also saw a dip by 2.2%, with rents expected to stay soft for the remainder of 2021. The next year is expected to aid the continuing improvement due to progressive easing of border restrictions and higher vaccination rates.