The research, which explores the level of shopping centre development in major cities across the world, showed shopping centre construction in Australia is ‘demand-driven.’ Solid leasing demand is underpinning the redevelopment and rejuvenation of retail space in the CBD and the expansion of regional shopping centres.
Retail construction activity is most upbeat in New South Wales and Victoria, consistent with the outperforming retail turnover growth there, with the study postulating some landlords in these upbeat markets may consider converting office space to retail use.
Globally, 10.7 million square metres of new space opened in 2015 in the 168 cities surveyed, down from the previous year’s 12.1 million square metres of space completed. About 41.9 million square metres is under construction, up from the previous year’s 39 million square metres.
Asia Pacific remains the most active in terms of completions with 7.8 million square metres completed in 2015. The pipeline continues to be dominated by China, with over 6 million square metres completed in 2015. Emerging markets, including Manila, Moscow, Mexico City and Bangalore, are highly active as well. However, even in China shopping centre completions are down from the previous year (6.7 million sq m).
Experiential retail such as Food and Beverage, children-oriented and education services has emerged as key tenants of shopping centres in China, especially among community malls.
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