STOCKS NEWS SINGAPORE-Retail rents to fall 1-2 pct in 2013-DTZ
Retail rents in Singapore are expected to fall by about 1-2 percent next year, amid slowing retail sales, labour cost pressures and large supply coming onstream, said property consultant DTZ.
This year, only rents in suburban areas showed positive growth of 0.2 percent, while those in Singapore's main shopping belt on Orchard Road fell by 0.2 percent and by 1.5 percent in other city areas, DTZ said in a report.
Retail property landlords in Singapore include CapitaMalls Asia , CapitaMall Trust and Frasers Centrepoint Trust .
"With the difficulty in recruiting staff and the strong Singapore dollar, retailers are increasingly finding Singapore a less cost-effective place to set up presence in the region," said Anna Lee, DTZ's director of retail.
"Some of them have begun exploring options to expand operations in other countries which offer cheaper labour and rents, and a huge domestic demand base," Lee said.
However, DTZ said prices of retail properties continued to rise as lower interest rates attract investment. This year, the average capital value of prime resale retail units in Orchard and Scotts Road and the suburban areas rose 11.2 percent and 9.6 percent respectively. The divergence in rents and prices is expected to continue next year.
Source: Reuters