More than half of new prime mall openings in Singapore were F&B stores: Report

SINGAPORE: More than half (53%) of new store openings in Singapore’s prime malls in the first half of the year were food and beverage (F&B) outlets, according to Singapore Business Review, citing the latest Cushman & Wakefield’s Singapore outlook report.

The figures come despite continued reports of F&B closures in recent years amid higher rents, labour shortages and rising operating costs.

Still, the report noted that the number of new retail and F&B businesses continued to exceed closures. At the same time, physical stores remained the main channel for retail sales despite rising online sales, it added.

Other new openings came from lifestyle and fashion retailers, which accounted for 16% and 14%, respectively.

New market entrants, Chinese-backed companies and retailers opening their first physical stores also continued to take up retail space despite high tenant turnover.

The report noted, “Singapore remains a key entry point for international retail brands” thanks to the city-state’s “resilient consumer spending, recovering tourism, and role as a regional business hub”.

Looking ahead, Cushman & Wakefield expects limited availability of prime retail space to support rental growth.

Most upcoming supply will come from mixed-use projects in suburban areas, while prime retail rents in Orchard Road and suburban malls are expected to rise between 1% and 2% year-on-year (YoY) this year, slightly below earlier projections of 1.5% to 2.5%, amid economic uncertainty, inflation risks and softer labour market conditions.

Meanwhile, annual new retail supply through 2031 is expected to average 0.4 million sq ft, helping keep vacancies low in Tier 1 malls.

Around 65% of the upcoming supply is expected in suburban areas, compared with 5% on Orchard Road, the report added. /TISG

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