Kevin Tan
03-02-16, 08:54
http://www.theedgeproperty.com.sg/content/outlook-suburban-retail-market-2016
Outlook for suburban retail market in 2016
By Lee Nai Jia / DTZ, The Edge Property | January 26, 2016 9:00 AM MYT
Tags: retailsuburban mall2016
For the whole of 2015, average first-storey rents in suburban areas fell 5.7% to $31.70 psf. Rents in the suburban areas were more resilient than other city areas, which fell 6.9%. Apart from serving residents in the immediate vicinity, suburban malls also tend to perform better because of their longer operating hours. Malls in the other city areas are typically located in the CBD, which are often dependent on the weekday office crowd for both foot traffic and sales volume.
For suburban malls, much of the fall in rents for 2015 occurred in 2H2015. Average first-storey rents fell 4.7% in the period, versus a 1% decline in 1H2015. Although tourist arrivals and retail sales already showed signs of weakening in 1H2015, much of the impact on retail rents were felt only in2H2015. Weaker consumer sentiment, coupled with the sudden devaluation of the renminbi in August, has since sent the stock market on a downward spiral, further hurting consumer confidence.
While retail spending was boosted by SG50 celebrations in August, the y-o-y improvement was largely transitory. Retail spending on discretionary items was back in the red for subsequent months. For example, retail sales for watches and jewellery from September to November 2015 fell 6.8% compared with the same period in2014. Moreover, a similar downward trend was also observed for goods such as telecommunications apparatus and computers as well as recreational items over the same duration.
E-commerce factor
The overall decline in sales can also be attributed to the increased popularity of online shopping and the lower shipping costs in the past year. According to the Infocomm Development Authority, as at 2014, 88%of the households had access to the Internet, while 96% of the resident households used an Internet-enabled mobile phone to access the Internet.
With a wider range of options, more consumers have switched to online shopping portals. Based on The Consumer Barometer Survey conducted by Google in 2014/15, the most common types of items purchased abroad through the Internet were clothing/accessories(51%), followed by cosmetics/health (26%), books/CDs (26%) and computer hardware/software (19%).
Despite stronger competition from e-commerce, both the malls and brick-and-mortar retailers reinvented themselves to offer better a shopping experience. Strategies they have adopted include introducing pop-up stores to rejuvenate the retail scene, the adoption of omni-channel marketing by offline retailers to boost their market outreach, as well as the entrance of new-to-market brands to reignite consumer interests.
Malls introduce pop-up stores and new-to-market brands while retailers adopt
omni-channel marketing to cope with stiffer competition
http://www.theedgeproperty.com.sg/content/outlook-suburban-retail-market-2016
Outlook for suburban retail market in 2016
By Lee Nai Jia / DTZ, The Edge Property | January 26, 2016 9:00 AM MYT
Tags: retailsuburban mall2016
For the whole of 2015, average first-storey rents in suburban areas fell 5.7% to $31.70 psf. Rents in the suburban areas were more resilient than other city areas, which fell 6.9%. Apart from serving residents in the immediate vicinity, suburban malls also tend to perform better because of their longer operating hours. Malls in the other city areas are typically located in the CBD, which are often dependent on the weekday office crowd for both foot traffic and sales volume.
For suburban malls, much of the fall in rents for 2015 occurred in 2H2015. Average first-storey rents fell 4.7% in the period, versus a 1% decline in 1H2015. Although tourist arrivals and retail sales already showed signs of weakening in 1H2015, much of the impact on retail rents were felt only in2H2015. Weaker consumer sentiment, coupled with the sudden devaluation of the renminbi in August, has since sent the stock market on a downward spiral, further hurting consumer confidence.
While retail spending was boosted by SG50 celebrations in August, the y-o-y improvement was largely transitory. Retail spending on discretionary items was back in the red for subsequent months. For example, retail sales for watches and jewellery from September to November 2015 fell 6.8% compared with the same period in2014. Moreover, a similar downward trend was also observed for goods such as telecommunications apparatus and computers as well as recreational items over the same duration.
E-commerce factor
The overall decline in sales can also be attributed to the increased popularity of online shopping and the lower shipping costs in the past year. According to the Infocomm Development Authority, as at 2014, 88%of the households had access to the Internet, while 96% of the resident households used an Internet-enabled mobile phone to access the Internet.
With a wider range of options, more consumers have switched to online shopping portals. Based on The Consumer Barometer Survey conducted by Google in 2014/15, the most common types of items purchased abroad through the Internet were clothing/accessories(51%), followed by cosmetics/health (26%), books/CDs (26%) and computer hardware/software (19%).
Despite stronger competition from e-commerce, both the malls and brick-and-mortar retailers reinvented themselves to offer better a shopping experience. Strategies they have adopted include introducing pop-up stores to rejuvenate the retail scene, the adoption of omni-channel marketing by offline retailers to boost their market outreach, as well as the entrance of new-to-market brands to reignite consumer interests.
Malls introduce pop-up stores and new-to-market brands while retailers adopt
omni-channel marketing to cope with stiffer competition
http://www.theedgeproperty.com.sg/content/outlook-suburban-retail-market-2016