Queensland retail rents record its largest quarterly movement since Q1 2022

CBD rents declined 2.5% in Q2.

According to a JLL report, retail rents in the South East Queensland CBD recorded a q-o-q decline of 2.50%, the sub-sector’s largest quarterly movement since the first quarter of 2022. 

The neighbourhood sub-sector was the only other sub-sector to record a significant q-o-q movement, declining by 1.25%. 

Here’s more from JLL:

Excluding department stores which remained stable from the previous quarter, all other retail categories recorded declines in consumer spending. Total retail trade is down 1.5% from the previous quarter.

Leases are taking extended periods of up to six months to sign as space demand softens. Nevertheless, rents for super prime CBD space have not declined. In the CBD, luxury retail brands have been expanding their physical footprint. 

All sub-sectors record bi-annual decline in vacancy rates

One neighbourhood centre, South City Square, totalling in excess of 4,500 sqm, reached completion in the quarter. 

Construction activity is forecast to remain subdued over the latter half of the year. Only five new projects totalling 72,660 sqm are forecast for completion by the end of 2023.

Outlook: New retail project completions expected in the next quarter

Additional yield softening is forecast for regional, sub-regional and neighbourhood sub-sectors until the end of 2023.

Although construction delays have somewhat eased, minimal retail project completions are forecast for the remainder of 2023.  

Note: SE Queensland Retail refers to South East Queensland's overall retail market.