CONSUMER SENTIMENT TO STIMULATE MARKET
THE Gold Coast retail sector will continue to transform and change in 2020 driven by a boom in southern precincts, shoppers looking for more “experiences” and the growth of large-format developments, local experts say.
While the year has seen a number of assets hit the market, a number of deals have yet to be finalised. This includes the Oasis Shopping Centre in Broadbeach, which the Bulletin understands is very close to being sold to an Australian investment and funds management business.
Knight Frank Gold Coast’s investment sales director James Branch said the market has remained “relatively steady” through the year.
Mr Branch said he expects improved consumer sentiment and rising property values to fuel greater spending in the sector next year.
He said the biggest recent change has been the emergence of “villagestyle retail precincts” on the southern Gold Coast.
“Retail centres along the southern Gold Coast coastline, exemplified by the Burleigh retail centre but also including Palm Beach and Currumbin, among others, have continued to re-emerge and grow,” he said. “We have also seen lifestyle retail users such as cafes, restaurants and boutique breweries now opening up in the near coastal industrial precincts, and offering a unique product and benefiting from far lower occupation cost base. These precincts have become particularly popular with residents.”
Mr Branch said the Broadbeach and Surfers Paradise markets continue to be underpinned by strong domestic and international tourism numbers. He pointed towards Broadbeach as undergoing a “resurgence”, with new leases being signed in the precinct, referring to leases done recently with Raptis Developments and Gennari Group.
Mr Branch said in the short-term the expansion of the light rail from Broadbeach to Burleigh may lead to some disruption, but expected businesses in those areas to see growth over the long-term. The Gold Coast retail sector was tightly held throughout the year, according to new research from Colliers for the second half of the year. That kept a cap on the volume of sales (sitting at $69 million) with a low number of transactions between January and September. Competition for the few assets available led to sharp yields between 5.5 and 6.5 per cent.
The report, authored by Karina Salas, cites the sale of the Pacific Pines Town Centre for $30.1 million as the most notable sale for the period.
The overall message is the coming tide of wholesale supermarket chains and large-format retailers, with a particular concentration in the northern corridor between the Gold Coast and Brisbane.
Colliers Gold Coast director-incharge Steven King said retail investors are increasingly identifying tenants in the market seeking new space and tailoring vacant assets to the needs of those tenants.