Small centres on the up

STRONGER than expected retail sales growth in the third quarter of last year helped to maintain the robust performance of SA shopping centres, according to the IPD Retail Trading Density Index.

The new index, sponsored by the SA Council of Shopping Centres, reveals the trading performance of various types of shopping centres and tenant types.

The index will be released by IPD on a quarterly basis.

Although the turnover growth of shopping centres has recovered from the downturn in 2009 and early 2010, momentum has slowed and dropped below inflation for some types of centres.

It is the larger centres where the growth in trading density – measured as turnover a square metre – has been the most muted.

For the year to September 2011, trading density increased by 5.2 percent for super regional centres, by 5.5 percent for regional centres and just 3.8 percent for small regional centres, when compared with the previous year.

In contrast, the smaller community and neighbourhood-type centres increased their trading densities by 10.2 percent and 15.0 percent, respectively.

These smaller centres generally rely more heavily on basic necessities, such as groceries, to drive their sales, compared with larger centres with more specialised tenant types, which are targeted more at discretionary spending.