APPD Market Report Article
Melbourne
November 19, 2024Melbourne retail outlook underpinned by tight occupancy
- Victoria’s rolling annual retail trade growth to August 2023 was recorded at 1.8%, on par with the national average.
- Leasing enquiries were anecdotally higher as retailers prepare for the end-of-year shopping period.
New retail space of 34,600 sqm in Q3 2024
- Two new, two extension and one refurbishment project totalling 34,600 sqm reached completion in Q3 2024.
- Quarterly completions rebounded to 38%, above the ten-year historical average (25,165 sqm) after six consecutive quarters of below-average completions.
All sub-sector yields were stable from the previous quarter and on a 12-month basis
- The sub-regional sub-sector (6.50%) remained the highest yielding sub-sector in Victoria.
- Quarterly transactions totalled AUD 259.8 million, 18% higher than Q2 2024.
Outlook: Yields expected to remain stable
- Futures market is forecasting the RBA to cut rates in H1 2025, which may drive transaction liquidity in Victoria in the near term.
- No further yield softening is expected in the near term.
