Savills Singapore Retail Briefing Q3 2011

The threat of an economic slowdown is expected to put a lid on rental growth in the short term. However, Singapore's rising population and robust tourist arrivals will continue to underpin retail sales, with suburban malls benefiting particularly from the population growth.

Summary

- Big-format stores are increasingly dominating the local retail scene.

- H&M held a debut opening for its 33,000 sq ft store in Orchard Building, while Louis Vuitton opened its flagship store at Marina Bay Sands.

- More malls are embarking on repositioning exercises to stay ahead of the competition.

- Retail space per capita has shrunk from 8 sq ft to 7 sq ft over the past decade due to population growth, without taking into account the spike in visitor arrivals.

- Visitor arrivals hit 1.3 million in July, the highest number ever recorded for a single month.

- Defying recession fears, retail sales (excluding motor vehicles) posted a robust 10.7% year-on-year growth in July.

- Prime rents on Orchard Road inched up by 2% to S$35.1 per sq ft per month in Q3, while prime suburban rents rose marginally by 1% to S$30.5 per sq ft per month.

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