Singapore’s retail market registers second consecutive growth year as rents increase 0.5% y-o-y in 2024

Net retail necessity in the Outside Central Region got to 560,000 sq ft in 2024, over 4 times the 129,000 sq ft in 2023, while net supply amounted to 603,000 sq ft.

The most up to date data shows that retail leas raised 0.6% q-o-q in 4Q2024, building on the quarterly rise of 0.3% documented in 3Q2024.

On the other hand, Leonard Tay, head of study at Knight Frank Singapore, believes that the relatively strong Singapore money and inflationary cost pressures might stimulate several residents to redirect their retail investing abroad. “Prime retail rental growth for 2025 is anticipated to ease and stabilise within a forecasted range of between 1% and 3%,” he states.

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“Lease development ability, however, could be moderated by usage leak arising from outgoing travel and the power of the Singapore money, as well as stores’ sensitivity to lease hikes among a challenging and uncertain operating environment,” states Phua. Based on JLL Research’s retail property portfolio, she expects leas for prime flooring area of investment-grade retail assets to continue growing by 1.5 to 2.5% y-o-y in 2025.

” Sellers continue to include experiential aspects into their bricks-and-mortar establishments, to enhance the buying experience and drive client involvement. Zara and Levi’s resumed at ION Orchard in 2024, with Zara launching express in-store pick-up and Levi’s revealed its initial Dressmaker Store,” claims Wong Xian Yang, head of research study Singapore & SEA at Cushman & Wakefield.

On the other hand, list prices dipped 1.3% q-o-q in 4Q2024, close to erasing the quarterly raise of 1.7% that was reported in 3Q2024. Nevertheless, retail prices ended 2024 with a boost of 1.0% y-o-y compared to the 1.2% y-o-y increase marked in 2023.

Not only prime retail areas in the Central Area have actually viewed an uptick in demand. Net retail need in the Outside Main Region (OCR) was 560,000 sq ft past year, about 4 times the 129,000 sq ft absorbed in 2023.

Wong mentions that vacancy rates in the OCR increased slightly to 4.3% in 4Q2024, ascend from 4.2% in 4Q2023 however still below the pre-pandemic 6.2% in 4Q2019, which reflects a tough suburban retail market. He includes: “Enhanced connectivity and assorted retail products, consisting of life-style and dining choices, have actually improved rural charm, drawing in respected abroad F&B companies. Japan’s Warabimochi Kamakura and Hong Kong’s Ging Sun Ho King of Bun have actually debuted at One Holland Village and Tampines Mall, respectively.”

As an example, French sports brand Salomon opened avenues at Ngee Ann City and Orchard Central, while Finnish lifestyle brand name Marimekko started its 2nd site at Ngee Ann City after its 2023 debut at ION Orchard.

Looking ahead, the island-wide retail openings level is expected to remain limited this year, which must sustain rental growth for prime retail spots, states Phua. She includes that the marketplace will be buoyed by sustained domestic consumption, a tighter labour market, and a positive tourism overview in 2025.

Angelia Phua, consulting supervisor of research and consultancy, Singapore, at JLL, claims that the latest rental and price data show that the healing in the wider retail property sector is mainly on track in spite of continuous economic obstacles such as intake leakage, the dampening effects of cost rising cost of living on usage and cost tensions encountered by retail drivers.

The descending trend in the island wide retail vacancy pace, which slipped for the third consecutive quarter, underpinned durable occupant demand amid a moderate supply of retail space this year, says Phua.

Rental growth in Singapore’s retail property industry registered a yearly surge of 0.5% for the entire of 2024, according to realty statistics published by URA on Jan 24. This notes the 2nd constant year that the regional retail market has seen leas improve, after increasing 0.4% y-o-y in 2023.

Additionally, the island-wide vacancy rate in the retail real estate industry slipped 0.3% q-o-q to 6.2% in 4Q2024. This was mainly driven by declines in the vacancy rates in the Central Area (falling 0.4% q-o-q to 7.2%) and Outside Central Region (dropping 0.3% q-o-q to 4.3%) previous quarter.

She includes that new interest for retail area was spearheaded by the entry of new-to-market labels and the expansion of existing brands such as F&B, active lifestyle and sports, fashion labels, as well as beauty and wellness brands.


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