Re­tail­ers squeezed by rents

Pilbara News - - Front Page - Alicia Per­era

Long-term re­tail leases still set at min­ing boom lev­els are pric­ing out many Kar­ratha re­tail­ers, ac­cord­ing to the lo­cal cham­ber of com­merce chief ex­ec­u­tive.

Re­tail has been iden­ti­fied as an area of po­ten­tial growth for the City of Kar­ratha area, with four Pil­bara lo­cal gov­ern­ments hold­ing a sur­vey ex­plor­ing re­tail op­por­tu­ni­ties in the re­gion late last year.

But Kar­ratha and Dis­tricts Cham­ber of Com­merce and In­dus­try chief ex­ec­u­tive John Lally said many lo­cal re­tail­ers, in­clud­ing at main shop­ping cen­tre, Kar­ratha City, were strug­gling.

Mr Lally said those who had signed long-term lease con­tracts years ago dur­ing the min­ing boom re­mained sub­ject to pay­ments too high for the cur­rent mar­ket.

“Ba­si­cally they’re locked into leases that were vi­able when there were lots of FIFO peo­ple in town,” he said.

“They signed up to leases that were sus­tain­able in that time, but that’s not the case now.”

Mr Lally said he be­lieved re­cently signed leases were more com­pet­i­tive as the re­tail sec­tor ad­justed to the new nor­mal, but it was tak­ing time for for­mer rents to “wash through”.

“They’re not de­mand­ing higher leases now ... they’re get­ting re­al­is­tic,” he said.

“It’s the peo­ple who are are locked into the longer-term leases that will find it hard to ser­vice them, and un­til these leases ex­pire and get re-ne­go­ti­ated then it makes it tough for re­tail­ers.”

Au­to­pro Kar­ratha owner Scott Chan­dler op­er­ated a store in Kar­ratha City shop­ping cen­tre un­til his lease ended in April last year.

He said he opted not to re­new be­cause the rent was higher than he thought re­al­is­tic any­more, and moved premises.

“They are ask­ing too much for

what they’re giv­ing,” he said of his for­mer lease.

North West Ex­press Mo­bile Butcher owner Larry Brewer said lo­cal rents were one of the main rea­sons why he had never leased fixed premises in his 41⁄2 years op­er­at­ing in the Pil­bara.

He said he had also no­ticed a trend in the num­ber of mo­bile busi­nesses, es­pe­cially food vans, in Kar­ratha in the past few years, pos­si­bly for the same rea­son.

City of Kar­ratha Mayor Peter Long said hav­ing af­ford­able re­tail space for both large and small busi­nesses was im­por­tant for the City’s live­abil­ity and they had worked with gov­ern­ment agen­cies to ex­pand the amount avail­able.

Vicin­ity Cen­tres, which owns Kar­ratha City shop­ping cen­tre, failed to re­spond to calls for com­ment by time of print.

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