Property services company, CBRE says Melbourne has witnessed the third-fastest growing retail rents in the world, just behind Hong Kong and Beijing. Prices have surged just over 32 per cent in the year to September. In comparison, residential rental prices climbed only 1.2 per cent in the September quarter according to the Bureau of Statistics.
You can blame the likes of international retailers like Zara for the price rises.
Despite many retailers crying poor, the addition of these stores, especially in Melbourne’s Bourke Street Mall and Sydney’s Pitt Street Mall have increased foot traffic and the ambience of their respective precinct giving them an international flavour and allure.
Just because Sydney isn’t the fastest growing doesn’t mean it’s not expensive. In fact, Sydney has the world’s third-highest retail rents with New York the most expensive. The redevelopment of Westfield Pitt Street has added to the street value.
These strong retail rents may struggle to grow as fast with the economy slowing down.
The Federal Government today lowered its economic growth forecast to 3.25 per cent in its Mid-Year Economic and Fiscal Outlook.
Furthermore, the stronger Australian dollar is also sending locals overseas to shop, and limiting the number of international tourists coming here to spend.