This is the sixteenth comprehensive study of the Australian retail market undertaken by BIS Shrapnel.

The report examines the overall structure of retailing in Australia and draws out key trends and issues in terms of both trading conditions and investment performance. It focuses on the main classes of institutional investment in the retail sector, and specifically considers prospects for regional and sub-regional shopping centres.

The report:

• Identifies the key drivers of demand, separating them into cyclical and structural factors. It explains the discrepancy between total household spending (solid) and retail turnover (weak) and forecasts demand state by state over the next 10 years.
  
  
• Assesses the distribution of retail turnover growth, in particular the rising market share of online retailing.
  
  
• Examines trends in supply and forecasts retail construction by state over the next 10 years.
  
  
• Discusses how the balance of demand and supply is reflected in rents and centre incomes, and discusses when the current trend of weakening centre income growth will turn around, and how strongly.
  
  
• Identifies the end of the long-term trend decline in retail yields as heralding a significant change in the nature of retail property investment.
  
  
• Assesses what level of returns can be expected in future and whether retail property is still a good investment.

Maria Lee

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