Sales growth is holding up in smaller malls despite the headwinds facing the retail sector, according to an industry report ranking subregional shopping centres.
Subregional shopping centres are defined as those between 20,000 square metres and 50,000 square metres. They are thought to be most at risk from softening consumer sentiment, while the smaller neighbourhood centres and the much larger fortress-style malls are better defended.
However, of the 88 centres ranked in the annual Little Guns report compiled by Shopping Centre News, only 14 malls showed a downturn in overall sales
growth. In six of those, the dip was less than 2 per cent. Six of the 94 malls covered by the report did not report this year because they are undergoing redevelopment.
By contrast, one-third of the country’s subregional shopping centres failed to increase their annual turnover in last year’s Little Guns report.
Topping the rankings this year is the Perron Group’s Belmont Forum in Western Australia, which achieved the highest turnover at $384.73 million, surging 12.4 per cent over the year.
That result came after the Perth mall completed a $65 million redevelopment, a common theme in the subregional category where improved customer experience is seen as vital in retaining foot traffic.
“The results also signify continual investment by owners in these centres to meet market demands,” said SCN’s publisher, Michael Lloyd.
“This year six are not reporting due to developments and many of the best performers this year displayed success as a result of development or re-mixing.”
A more indicative metric to measure the performance of a mall is its productivity, or turnover per square metre.
On that basis, Mirvac’s East Village in Sydney has taken the top gong with overall sales per square metre hitting $15,456, after growing 3.7 per cent over the year.
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Nick Lenaghan edits the Financial Review’s Property section, which covers all aspects of the sector: from residential real estate and the housing and construction markets, to commercial property – office, retail, industrial – and the major ASX-listed real estate investment trusts and property developers. Connect with Nick on Twitter. Email Nick at [email protected]