by Cheryl Tay
Central Orchard Road continued to perform well in Q3 2012 as prime rents reached S$43.50 psf, despite being 10.5 percent below the S$48.60 psf posted in mid-2008, according to Knight Frank's Q3 Retail Bulletin.
By the end of 2009, rents at Central Orchard Road had declined 15 percent due to the global financial crisis, as well as the large supply of retail space after the completion of Orchard Central, 313 Somerset and Ion Orchard.
Despite this, prime Orchard Road rents have posted a steady upward trend with the opening of the Integrated Resorts, which brought about strong visitor arrivals and the stabilisation of the supply of retail space within the area.
Average island-wide prime retail rents in Q3 2012 increased 1.5 percent quarter-on-quarter. In Central Orchard Road, average prime rents increased between one and two percent to S$43.50 psf, while rents on the Orchard Road fringe remained flat at S$24.10 psf.
Monthly gross rent for prime spaces stood at S$43.48 psf in Central Orchard Road and S$24.10 on the Orchard Road fringe. Rents island-wide stood at S$30.36.
In 2013, approximately 400,000 sq ft of retail space is expected, with the completion of the refurbished 268 Orchard, Heeren and Orchard Gateway (pictured).
Going forward, average retail rentals are expected to decline with the upcoming supply but prime rental rents may not be affected, as demand remains strong.
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