Promising uptick, but challenges persist for retail property

SINGAPORE'S latest retail property market data, released last week by the Urban Redevelopment Authority, has sparked some optimism that retail rents could be bottoming out.

After slipping 18 per cent from its most recent peak in the fourth quarter of 2014 to the third quarter of 2018, the URA's rental index for retail space in Singapore's Central Region rose 1.2 per cent quarter-on-quarter in Q4 of 2018. The price index for retail space in the same region also posted a 1.5 per cent q-o-q gain in Q4. This was the first time both indices posted q-o-q upticks of above one per cent since the series began in 2011.

Cheered by the pickup, observers have lauded both retailers and landlords, noting their perseverance in navigating the new landscape by minting solutions such as experiential retailing concepts to rise to the challenge from disruption that have beset the retailing industry.