Australian regional shopping centres are growing larger every year. According to a UrbisJHD’s 2005-06 Retail Averages report, in the past decade regional shopping centres have expanded by almost 40%.
According to UrbisJHD’s 2005-06 Retail Averages report, in the past decade regional shopping centres have expanded by almost 40%.
In its latest report, UrbisJHD found that the average size of an Australian regional shopping centre grew by 1,814 sqm last year, taking the average centre size to 75,249 sqm.
UrbisJHD found that over the past year, retail specialty shop floorspace has grown by an average of +4.1% per centre, faster than the total centre floorspace growth rate of +2.5%.
In terms of absolute numbers, there were 187.2 specialty stores per regional centre in 2005/6 compared with 181.0 in 2004/5. These stores now occupy a fraction under 25% of regional centre space.
The “Top 10 regional centres” subset (the top 10 centres by turnover) experienced no overall GLA growth in the past year. However, retail specialty shop floorspace at these centres increased by a hefty 7.0%.
UrbisJHD’s research director Michael Baker said in many instances, the expansions have involved significant additions of specialty stores as shopping centre owners strive to increase the destination appeal of their properties and improve financial returns.
“And it appears to be working because regional centres are taking market-share from other retail formats. Turnover at regional centres grew by grew 6.9% compared to 4.3% growth for Australian retail as a whole,” he added.
According to UrbisJHD, the average sales for reporting tenants at stabilised regional centres reached $415.9 million in 2005/6, yielding a turnover per sqm of $5,929.
For the Top 10 regionals, volume averaged an impressive $680.3 million for a turnover per sqm of $6,170. Stabilised regional centre turnover growth was +6.9% in 2005/6, compared with +4.3% for Australian retail as a whole.
Baker said the key message from the data is that despite sluggish growth on a productivity basis for retail specialties, the overall performance of stabilised regional centres over the past year has been very solid.
“This compares favourably with overall retail turnover growth in all channels of +4.3%. Regional centre anchors, mini-majors and some specialty store categories have achieved solid sales growth throughout a period of fragile consumer sentiment and taken market share from other channels in the process.
“Other majors” and mini-majors in particular have grown in stature and turned in very strong performances, indicating a shift in consumer preferences toward larger formats for a variety of discretionary items,” he added.
By Adam Parsons
