Island-wide vacancy hit 7.3% in Q1.
Prices and rentals of retail space in Singapore continued to slide in the first quarter, while the overall vacancy rate inched up to its highest level in at least five years.
Statistics from the Urban Redevelopment Authority (URA) show that the island-wide vacancy rate of retail space rose to 7.3% as at the end of Q1, from 7.2% at the end of the previous quarter. The vacancy rate at Orchard Road jumped to 8.8% from 7.6% in the previous quarter, while vacancy at outlying regions inched up to 6.4% from 6.1% in Q4.
Meanwhile, prices of retail space decreased by 1.9% in the first quarter, compared to the decrease of 0.1% in the previous quarter. Rentals of retail space decreased by 1.9% during the period, compared to the decrease of 1.3% in the previous quarter.
According to CBRE, the ongoing structural changes in the retail market continued to dampen occupier demand after the year-end festivities.
“Most retailers remained highly cautious about expansion plans as they focus on evaluating existing operaitons strategies. There were also retailers who decided to shut some stores and/or exit the market entirely, creating more vacant spaces to be filled,” CBRE said.
“Demand is likely to stay patchy. This does not bode well for overall occupancy with more supply due to complete from now till 2019,” CBRE added.