Vacancies high in CBD
Vacancies in Melbourne's CBD street-front shops have risen to their highest levels in five years, a Knight Frank survey shows. While the CBD's overall rate rose marginally, difficult conditions took a toll in the city's heart. Empty stores in arcades shot up 1.4 per cent, the survey reveals.
"The CBD retail vacancy rate has increased from 2.4 to 2.6 per cent over the past year with street-front shops rising from 2.7 to 3.9 per cent, the highest it's been in five years, while arcades rose from 0.6 to 2.0 per cent," retail leasing director Gary Loo said.
But Melbourne's growing work and residential population, along with recent cuts in interest rates, were likely to offset the gloomy trading conditions and slow rises in retail vacancies.
Shopping centres such as 234 Collins, Melbourne Central and QV were holding up well. Vacancy rates fell to 1.0 per cent, down from 3.1 per cent in June 2012, Mr Loo said.
The food sector rose as a proportion of CBD retail space, jumping 8.1 per cent over the past year, taking up nearly a third of core retail stock. At the same time clothing stores slumped by 4.3 per cent.
Rents have remained stable. Prime rents are between $2500 and $7000 per square metre and secondary rents between $800 and $1500 per sq m.