We’re pleased to provide further findings of our survey, taken place in Melbourne CBD’s retail core in March 2020.
We identified a vacancy rate of 5.6% by shop count and 4.9% by square metres.
When we begin to analyse this vacancy rate, we see basements and first floors have no vacancy, with only 11 outlets featured within the survey results. Basement retail rent is generally lower, and they offer a more boutique, destination-style retail experience. Consumers seek these outlets, rather than stumble into them.
Absolute street frontage, arcade and laneway retail account for 411 outlets, with 35 vacancies highlighted in the survey. A large quantity of vacancies are in Howey Place, which is undergoing substantial capital works renovations.
Generally, street frontage is regarded as the most desirable retail floorspace available, so we expect that it will have the lowest vacancy due to high demand.
Dedicated shopping centres are home to the largest number of retailers, with a broad tenancy mix across many industries, such as gyms, cinemas, restaurants, retail kiosks and all in between.
Another important factor which may explain high levels of vacancy in some areas, is the often over looked notion of ‘churn’. At the end of a lease, some retailers move to a different, sometimes preferred, location and there is downtime in the tenancy before a new tenant moves in.
To discuss What’s Next in retail leasing, please reach out to the Victorian retail leasing team.