Singapore’s retail rentals yet to see gains from reopening

Bloomberg

Singapore’s retail space rentals are lagging the recovery seen in broader economic activity after the city-state ended Covid-19 curbs.
Official data showed retail rents contracted 0.4% from the previous quarter — the third straight quarterly decline since 2021. That compares to an 11% average growth in retail sales during the same period, data compiled by Bloomberg show.
Singapore returned to growth in the third quarter as reopening from pandemic restrictions fuelled demand across sectors from locals as well as foreign visitors. The Ministry of Trade and Industry, which estimates the economy to expand 3%-4% this year, is expected to publish its first official forecast for 2023 later this month.
“The recovery has been uneven across different retail segments,” according to a spokesperson for Starhill Global REIT, adding that higher utilities, manpower shortages along with higher wages and inflationary pressures have affected tenants’ operations and expansion plans.
The Covid-19 crisis upended the retail industry, forcing the closure of physical stores and causing uncertainty for the future of the in-store experience. With curbs lifted and travellers returning, retail sales have picked up, registering a double-digit growth for a sixth straight month.
Spending on wearing apparels including footwear and food & alcohols surged more than half in September, followed by watches & jewelry. Events like the Singapore Grand Prix in September helped burnish the retail climate and a broad-based recovery is expected, according to a research report released by the Edmund Tie.