Retail Rents on the Rebound as Dust Settles on the Pandemic

Dwell times and sales volume growth outpace recovery in footfall. F&B and “wellness retail” grow, following transformations in consumer buying habits.

November 30, 2023

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Melvin Lin

Head of Marketing & Communications, Singapore

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By Tricia Song (宋明蔚), Head of Research, Southeast Asia, CBRE

Singapore, 30 November 2023 – Retail rents are steadily recovering, following the more than 10% fall to its trough in 2021. While prime rents have yet to return to the pre-pandemic levels of almost S$28.00 per square foot per month, recovery is expected to continue beyond 2023.

These are among the findings revealed in CBRE’s latest report, Singapore Retail in the Post-Pandemic Era: Trends and Opportunities.

Joan Chen, CBRE Head of Retail, Singapore, explained, “The movement restrictions imposed in response to COVID-19 brought about a huge shift towards online shopping. The steep and sudden decline in shopper traffic within a few months coupled with COVID-19 restrictions lead to a sharp decline in retail and F&B sales resulting in closures, increased vacancies, and consequently lower rentals during the pandemic period.”

Online penetration rates shot up more than 2.5 times between Q1 and Q2 2020 when the circuit breaker measures were introduced, hitting a high of 22.2%. While current penetration rates have normalised to about 14 – 15%, CBRE Research forecasts an increase to 21.7% by 2026, fueled by the vibrancy of the e-commerce ecosystem, increased adoption of digital wallets, and continued growth in the use of credit and debit cards.

Joan added that although offline sales should continue to contribute to majority of retail sales, retailers should establish a complementary online presence to cater to consumers’ omni-channel shopping habits.

Lim Mian, CBRE Retail Consulting Lead, Asia Pacific, added, “Due to this shift towards omni-channel shopping habits, in addition to lower tourist numbers, footfall at most malls have yet to recover to pre-pandemic levels, even if tenant sales numbers have met or even exceeded the numbers recorded pre-pandemic. Interestingly, we have also found shoppers are now on average spending more time in malls than before COVID-19, and this trend is especially pronounced in malls located in the city fringe area. This could be partly attributed to a rejuvenation of retail spaces in these malls, coupled with a refresh of tenant mix.”

F&B businesses account for the majority of new openings or expansions, at 61%. The next closest category is Fashion, coming in at 9% - almost half its pre-pandemic share of the pie. The report also observes a shift towards “wellness retail”, noting an increase in the number of gyms and services in response to greater consumer focus on health and wellness.

Other changes witnessed post-pandemic include the incorporation of pop-up stores - typically set up to test-bed new concepts and to showcase limited-edition goods - as part of landlords’ curated tenant mix. Some retailers are also forgoing spaces in shopping centres, preferring shophouses/ heritage buildings which generally have fewer constraints and may be a better fit for their brand positioning.

Joan further observed, “Post-Covid buying patterns have evolved to be more than just pure consumption-driven. Hence, retailers are seen to be levelling up their in-store experiences to attract and boost consumer visits to physical stores instead of buying online.  Retailers have also jumped onto the experiential retail bandwagon, and are holding events more frequently, including activities and workshops, interactive displays and installations and pop-ups which can be capitalized on social media for incremental impact. CBRE Calibrate data shows that foot traffic generally increased 10 - 25% in malls that held experiential events. Going forward, we are likely to see more of these efforts to engage shoppers, to encourage them to visit the stores in person to make purchases.” 

In conclusion, Tricia Song, CBRE Head of Research, Singapore and Southeast Asia projected that retail rentals are likely to continue its recovery: “Annual supply of new spaces from 2023 to 2026 is expected at 0.48 million square feet – almost a quarter below the 5-year historical average. A full tourism recovery, supported by Singapore’s strength as a business and transit hub, as well as robust pipeline of MICE and entertainment events, is also expected in 2024. This should further fuel optimism and demand from retailers.”

Tricia added, “In the longer term, the revitalization of Orchard Road through the government’s Strategic Development Incentive (SDI) Scheme and the private sector’s enhancement works and redevelopments are likely to boost the profile of Orchard Road. These should bring more exciting opportunities for retailers and investors, and most importantly, enhance Singapore’s status as a top shopping destination for local and overseas consumers.”

To read the full report, click here.

About CBRE Group, Inc.
CBRE Group, Inc. (NYSE:CBRE), a Fortune 500 and S&P 500 company headquartered in Dallas, is the world’s largest commercial real estate services and investment firm (based on 2023 revenue). The company has more than 130,000 employees (including Turner & Townsend employees) serving clients in more than 100 countries. CBRE serves a diverse range of clients with an integrated suite of services, including facilities, transaction and project management; property management; investment management; appraisal and valuation; property leasing; strategic consulting; property sales; mortgage services and development services. Please visit our website at