Uptick in WA retail turnover growth

• WA retail trade growth reached 3.6% year-on-year in December 2024, compared to the 3.2% year-on-year growth from the three months prior. Spending in the other retail category, which include recreational goods retailing, recorded the strongest growth (5.7% year-on-year).
• Although enquiry levels continued to be slow, much like the previous quarter, new fashion retailers have opened in the Perth CBD. Hospitality and services retailers also continue to expand their offerings, securing retail space, especially in neighbourhood centres.

One major development is completed over the quarter

• One major development completed over Q4 2024, totalling 6,800 sqm. Over the past 12 months, completions totalled 15,100 sqm; significantly below the 10-year annual average of 74,100 sqm.
• There are currently six major developments under construction, forecast to add 46,800 sqm by Q1 2026. In addition to projects already under construction, there are 14 projects with plans approved totalling 255,900 sqm.

Fall in investment volumes over Q4 2024

• Marginal growth in average rents was recorded across all sub-sectors during Q4 2024. Despite only marginal increases to gross rents, an upward trend in rental growth has been evident across most sub-sectors over the last two and a half years.
• Investment volumes decreased significantly, with only two major transactions recorded over Q4 2024, totalling AUD 42.9 million. The largest transaction over the quarter was Woolworths Clarkson, which exchanged for AUD 35.8 million, at AUD 5,527 per square metre.

Outlook: Rental growth anticipated to accelerate over the short term

• With the expectation that retail spending levels in WA will remain positive over the medium term, rents across all sub-sectors are forecast to increase by an annual average of 1.9% to 2.9% from 2025 to 2029, with strongest growth anticipated in the regional sub-sector.
• Retail demand and investment fundamentals are expected to improve in the Perth market as interest rate expectations are revised lower over the next 12 months.