wa’s retail sector leads the nation at the first quarter

wa’s retail sector leads the nation at the first quarter

May 2019
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WA’s retail sector leads the nation at the first quarter

CBRE’s Q1 Retail MarketView report has revealed that Western Australia’s retail sector outperformed the nation in the first quarter of 2019, providing validated encouragement for increased activity in the state’s retail investment space.

The report highlights WA’s 0.9% increase in retail turnover from the previous quarter, markedly better than the nation’s average of 0.7%. Queensland and Victoria managed a 0.8% increase through the three-month period, while New South Wales saw a lift of 0.5%. South Australia experienced a 0.2% rise, while the Northern Territory saw a decline of 0.4%.

Western Australia enjoyed a strong start to the year, seeing $91.4 million worth of investment activity; representing an 8.1% increase year on year. The research also showed that WA shopping centre yields have sharpened from 2018, averaging 6.2%.

Total investment activity for the nation in Q1 reached $623 million; a 50% decline on the $1.27 billion worth of activity recorded in Q1 2018. CBRE expect, however, that investment volumes will increase “significantly” through the rest of the year as investors look to redistribute portfolios.

“We expect to see yields for A-grade supermarkets and neighbourhood shopping centres strengthen throughout 2019, fuelled by an influx of new buyers entering the market locally, nationally and globally,” CBRE’s Richard Cash commented.

CBRE’s Anthony Del Borrello has suggested that WA is likely to see an increase in the number of sub-regional shopping centre sales coming to the market as supply looks to meet demand.

“Demand for sub-regional centres is likely to stem from a couple of different sources – offshore groups interested in landbanking income producing assets in growing locations and value-driven retail owners, who are looking to generate income growth through active and innovative asset management.”