Archive for category: Finances

Singapore’s retail sector appears to be regaining strength and showing signs of recovery. The tourism sector has seen a significant recovery since last year, and visitors to Singapore are staying longer on average than before the pandemic. This has been instrumental in driving the growth of prime retail rents island-wide, particularly in the prime Orchard Road shopping strip. Suburban malls also remain fairly stable, with rents seeing a slight growth of 0.6% q-o-q. The return of international luxury brands, as well as new F&B entries to the market, speaks to the optimism felt by the retail sector since the start of 2021. Going forward, the recovery of the sector should continue to support retail rents, although there may be some headwinds to navigateStill, the outlook remains positive given the number of tourist arrivals expected in 2023. According to the Singapore Tourism Board, between 12 and 14 million arrivals are expected, likely to bring further stability and growth to the sector. With a prevailing cautious optimism in the post-pandemic retail scene, prime retail rents are anticipated to increase by 3 to 5 percent in 2023.

Despite the ongoing effects of Covid-19 and inflationary pressures, Singapore’s retail sector appears to be regaining strength in the wake of the pandemic. In the first quarter of 2023, gross retail rents of prime spaces island-wide averaged $26.40 psf per month, up 1.2% q-o-q and 5% y-o-y, as a direct result of the recovery in the tourism sector.

The Myst Condo offers a convenient location with easy access to schools, commercial spaces, parks and public transport networks. It is close to the Tan Chong Industrial The Myst Bukit Timah Park and the 19-floor Hazel Park condominium building.

Since the borders reopened in Asia, and particularly in Singapore, the market has welcomed more than 2.9 million tourists in the first quarter of 2023. This figure is still two thirds of the 4.7 million visitors that visited before the pandemic, however the average stay of visitors has gone up from 3.34 days in 2019 to 3.97 days in 2023.

This influx of tourists combined with an 18.7% m-o-m decrease of retail sales in February has been instrumental in boosting recovery in retail real estate rents, particularly in the prime Orchard Road shopping area. Here, rents rose 1.4% q-o-q and 5.2% y-o-y to reach $26.40 psf pm. Similarly, prime retail rents in the Marina Centre, City Hall and Bugis area rose 1.3% q-o-q and 5.2% y-o-y, while retails rents in the City Fringe surged 1.4% q-o-q and 4.4% y-o-y.

Retail rents in suburban malls have also seen an uplift of 0.6% q-o-q, reaching $26.20 psf pm, or 3.6% higher y-o-y. Furthermore, consumers’ shift towards experiences and lifestyle concepts has been further evidenced by the return of international luxury brands such as Giuseppe Zanotti, Grand Seiko and Atelier Cologne, as well as new entries like Takagi Coffee and Luckin Coffee, despite some restraint in spending.

Looking ahead, the number of tourist arrivals is estimated between 12 to 14 million in 2023 and Knight Frank’s Ethan Hsu predicts that prime retail rents should register moderate gains of between 3% and 5% over the course of the year. The sector is therefore likely to remain on a steady recovery path despite some headwinds including inflation, economic uncertainty, and the upward revision of the goods and services tax.