Perth’s new apartment market recorded its strongest quarter of sales since Q4 2021, with 412 apartments sold in Q1 2026 and a record quarterly sold value of $537 million, according to Urbis’ latest Apartment Essentials results.

Urbis said the March quarter result reflects strong, highly product‑specific demand across both ends of the market, from more attainable projects delivering at scale, through to premium stock being absorbed by equity‑rich downsizers.&nbsp;

David Cresp, Partner at Urbis, said the key story in Perth is not demand, it is the market’s ability to convert demand into delivered housing.&nbsp;

“This is the strongest sales quarter since Q4 2021, and it reinforces that demand in Perth is real and it’s local,” David Cresp said. “But the task now is delivery, turning that demand into projects that can actually be built and completed.”&nbsp;

[smartcode_project:default project_id=110291 project_image_fid=302785]

<h2>Affordable product leads, premium demand remains resilient</h2>

Sales in Q1 were led by more affordable projects, with The Boulevard (SKS Group) recording 115 sales in the quarter, the presentation noting this is only the second time a single project has surpassed 100 quarterly sales. The project was able to offer more affordable housing product right next to a train station.&nbsp;

Palmyra West (Finbar) also delivered strong results with 28 sales in Q1, following 84 sales in Q4, with an average price of under $800,000, underscoring depth of demand for well‑located, attainable new stock.&nbsp;

At the premium end, Urbis said downsizer demand is continuing, with the results highlighting Romeo (Applecross, Finbar) recording 75 sales and reaching almost 50% sold in one quarter.

Jual (Shenton Park, Celsius Property) also posted a strong quarter with 28 sales, reaching 39% sold in one quarter.

Urbis noted that Perth apartment demand is not speculative, not investor‑led, and not uniform, describing it as localised, often equity‑driven and highly product‑specific, a pattern reflected in the polarisation between strong “attainable” performers and premium downsizer product.&nbsp;

[smartcode_project:default project_id=148957 project_image_fid=364102]

<h2>Prices underpinned by costs, and the delivery risk is growing</h2>

Urbis said pricing pressure is cost not demand‑driven: construction costs and delivery risk are now a central constraint, with the results noting build costs remain elevated and volatile, and that energy, fuel and labour uncertainty weigh on feasibility.

David Cresp said a growing challenge for private Build‑to‑Sell developers is simply securing a builder in the current environment.

“Developers are really feeling the pressure from a building market that was operating at capacity and securing a builder is challenging,” David Cresp said, adding that even where a builder can be secured, “trying to get to the price that makes the development financially viable is incredibly challenging in the current market.”&nbsp;

Urbis’ broader WA commentary also notes that industry remains at or above capacity with lot and housing creation, and that many builders are limiting new sales to manage stretched workforces and fixed‑price contract pressures, conditions that flow directly into apartment feasibility and delivery timing.

[smartcode_project:default project_id=108869 project_image_fid=317905]

<h2>Supply: improving later, but still constrained, and Perth lags eastern benchmarks</h2>

While near‑term supply remains constrained, Urbis’ forecast shows completions lifting “Supply is forecast to be back above 1,500 apartments per annum for the first time since 2019”, with 1,775 completions forecast for 2026, and volumes remaining above that level over the following years.&nbsp;

Looking further ahead, completions are forecast to reach 2,500 in 2028, with the report noting 32% of that total is social/affordable, reflecting the role of government‑supported delivery in rebuilding the pipeline.&nbsp;

However, Urbis said Perth remains behind comparable markets on pipeline scale. In a national comparison of projects under construction, the report shows under construction Perth Build‑to‑Sell (BTS) at 3,446 apartments versus the Gold Coast at 7,922. Mr Cresp said “The challenge for Perth is how to we grow the delivery pipeline”.

Urbis’ conclusion is that Perth’s market is increasingly defined by product discipline and delivery certainty, with the research identifying “delivery certainty is key” and calling out builder risk and procurement models as core success factors, alongside “timing and staging”.&nbsp;

Joel Robinson

Perth apartment sales hit strongest pace since late 2021 as builder capacity tightens

<a href="https://www.apartments.com.au/developers/sammut-developments">Sammut Group</a> has secured development approval for its latest Brisbane apartment project, marking the Sydney developer’s next step in expanding its Queensland pipeline following the success of its debut Gold Coast development, Coast.

The approved project at <a href="https://www.apartments.com.au/new-apartments/44-glen-road-toowong-qld-4066">44 Glen Road, </a><a href="https://www.apartments.com.au/developments/toowong-qld-4066">Toowong</a> will deliver a 15-storey riverfront apartment building with 42 residences, significantly increasing the scale of the site’s previous approval for a smaller luxury scheme. Designed by Bureau^proberts, the development will comprise a mix of predominantly four-bedroom and two-bedroom apartments positioned to maximise Brisbane River and city views.

Sammut Director Julian Sammut said the group had been actively searching Brisbane for several years before identifying Toowong as the right fit.

“Brisbane was the right step for Sammut,” Sammut said.

“With the success of Coast we thought we should definitely look to do more in Queensland alone. We then pushed up to look at Brisbane. We've been looking for I'd say two to three years actually and it was hard to find the right location.”

<img alt="Sammut makes Brisbane apartment play" data-entity-type="" data-entity-uuid="" src="https://res.cloudinary.com/dz9xllyip/image/fetch/f_auto,c_limit,w_1440,q_75/https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/field/image/Screenshot%202025-12-23%20at%203.27.14%E2%80%AFPM.png?VersionId=dYAVIL7qdcGA8ojvkslSrLjczXFejSSx" />

Sammut said suburbs including New Farm and Teneriffe were considered before the group ultimately focused on Toowong due to its strong downsizer demographic and limited supply of developable riverfront land.

The site was acquired off-market after what Sammut described as a lengthy negotiation and planning process, with the developer pursuing an uplift to the original approval.

“We are DA approved now which is very exciting,” Sammut said.

“We've had our change approval come through and we've obviously doubled the height, 15 storeys plus rooftop. We've got 42 amazing apartments that are going to be coming to market soon.”

<img alt="Sammut makes Brisbane apartment play" data-entity-type="" data-entity-uuid="" src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,dpr_2.0,q_auto:good/https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202025-12-23%20at%203.27.26%E2%80%AFPM.png?VersionId=ohkRkY0dIZlqdfME2EZePsCQavRiBadE" />

Bureau^proberts said the design responds to Toowong’s evolving urban character, balancing contemporary apartment living with the area’s established residential identity.

“A place where traditional Queensland living has taken place for centuries; Toowong is seeing a shift of contemporary influence, commercial and retail hubs mixed with well-considered residential offerings – all the while maintaining its character and charm,” the architect noted in planning documents submitted to Brisbane City Council.

The architecture practice said the project’s form was shaped by its riverfront setting, flood considerations, neighbouring building scales, and view corridors.

“They said the mix of four and two-bedroom apartments capture the ‘fundamental qualities of Queenslander living,’ translated into the context of a contemporary subtropical building.”

The development sits just off Coronation Drive within walking distance of Toowong’s retail precinct and the upgraded Regatta ferry terminal, while also benefiting from proximity to the incoming green bridge connection to West End. Sammut said the accessibility and amenity offering were central to the site’s appeal.

The approval adds to growing residential activity along the Toowong riverfront, joining nearby projects including Consolidated Properties’ Monarch Residences and Spyre Group’s ARC Residences.

Sammut secures approval for debut Brisbane apartment development in Toowong

Developer Lanevick is heading back into Sydney’s apartment market after focusing more heavily on the luxury townhouse and terrace sector in recent years.

Lanevick, founded and directed by Steve Maroun, is expecting to receive approval in the coming months for a new apartment development in Gladesville, with the aim to launch it to the market later this year.

The 51-apartment project, designed by Studio Johnston, will comprise a mix of one-, two-, and three-bedroom apartments positioned toward the Hunters Hill downsizer market.

“Traditionally it’s been difficult for people in that market to downsize because there just hasn’t been the right product available,” Maroun said.

“We’re targeting buyers who might have 30 to 40 per cent of their house value sitting in the bank after downsizing.

“They still want good spacious entertaining areas, they still want quality design, but they also want flexibility and the ability to enjoy life a bit more after working hard for a long time.”

The project sits near Boronia Park and within close proximity to the Parramatta River foreshore, an area Maroun says offers more of a Hunters Hill lifestyle than a traditional apartment precinct.

“From a lifestyle perspective, it’s really more Hunters Hill than Gladesville,” Maroun said. “You’re close to the foreshore, close to parklands, and still connected back into the village precinct.”

From level four and above, apartments will capture water views&nbsp;toward Sydney Harbour. Communal amenity will include rooftop entertaining areas, wellness spaces, and a gym tailored toward owner-occupier buyers.

“We’ve really designed these apartments around that buyer coming from the Hunters Hill LGA and what they’re actually looking for in their next chapter.”

The proposed development has also been designed to respond to the changing character of the broader Gladesville town centre, where a growing number of mixed-use and residential proposals are expected to emerge over the coming years.

“Gladesville presented a rare opportunity to deliver a genuinely design-led residential project within an evolving lifestyle precinct, just moments from the growing Gladesville town centre, and we’ve approached the project with a strong focus on architecture, liveability and long-term community value,” Maroun said.

Maroun said Lanevick saw a first-mover advantage within the precinct as planning controls continue to evolve to accommodate greater housing density.

“We think there’s a real opportunity there that hasn’t really been serviced properly yet,” he said.

“There’s going to be a broader evolution of the whole Gladesville village precinct over time, particularly with more activation and mixed-use outcomes.”

The Venus Street proposal will include a commercial and retail component at ground level designed to contribute to that evolving streetscape activation.

“A big part of the thinking was how do you activate that area properly and create more vibrancy and amenity, which is what Hunters Hill has been looking for,” Maroun said.

Lanevick’s focus since 2020 has largely been on smaller-scale luxury townhouse and terrace developments. The developer recently completed Royale Randwick, also designed by Studio Johnston, where prices reached $3.65 million. The project was featured in the UDIA NSW 2026 Professional Development Prospectus and was also named a finalist for Development of the Year.

&nbsp;

Lanevick to cater for Hunters Hill downsizers with new Gladesville apartment development

Property developer One Living, backed by former Macquarie banker turned investment manager Chris Green’s investment firm, has unveiled plans to bring more institutional capital into housing to help address the national supply crisis.

The New York-based investor has focused his firm, GreenPoint Partners, on addressing the supply shortage hitting middle market housing in Australia.

It is backing the new One Living business to develop more than 1000 units along the eastern seaboard. The new firm is starting with a development on Mona Vale Road, on the border of Mona Vale and Pymble, in Sydney’s Northern Beaches, with around 140 apartments planned. They are eyeing off more sites across the city.

With cost pressures rising in the industry, One Living’s model is to be a vertically integrated developer-builder, so it can respond directly to the housing gap by removing the cost inefficiencies embedded in traditional residential delivery.

“We are building a platform designed to operate at scale and starting in a market where there’s a clear need for quality, attainable housing,” One Living joint managing director Joseph Scuderi said.

“It’s that missing middle – it’s that attainable end of housing… that’s what most Australians invest into and what Australians can actually afford.”

<img alt="Mona Vale" data-entity-type="file" data-entity-uuid="798dfa93-4941-4db6-a696-31e9dc18e81c" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-05-28%20at%202.31.50%E2%80%AFPM.png?VersionId=mKBqi5C_DmeiXS.AtJkcR8LQIxqCqmFi" />

GreenPoint Partners brings years of experience assembling and scaling real estate operating businesses across major markets. And Green sees a big opportunity in Australia.

“For its size, sophistication and importance to the community, Australia’s living sector has remained largely under-institutionalised, which represents significant opportunity,” Green said. “GreenPoint identified that gap, assembled the right team, and is backing One Living to build a platform that is aligned to market needs.”

Green said being a builder-developer would give the company the capacity and flexibility it required to deliver reasonably-priced homes.

“We want it to be at that attainable level; not super high end luxury but at that attainable level,” he said.

<img alt="Mona Vale" data-entity-type="file" data-entity-uuid="74a5344a-4b26-4d4a-ada3-056b1220be77" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-05-28%20at%202.32.15%E2%80%AFPM.png?VersionId=vY8hXHO4reBMdO8ZXMWCNtGZJofUPQ3j" />

&nbsp;

One Living will undertake a component of affordable housing in its schemes, which it will own and operate, and it could also run build-to-rent on some sites.

Green praised local policy settings.

“The NSW government is being very supportive, strategic and pragmatic in terms of how do we generate more supply of housing,” he said. “We think it’s actually positive for development and the bit that’s been lacking at that attainable level is that it’s lots of relatively small private developers, whereas we want to create an institutional platform.”

One Living is also&nbsp;looking at high-density projects and could take on more institutional funding in the future.

“The way we will be able to achieve economies of scale is through size,” Green added.

One Living enters Sydney's new apartment market with Northern Beaches site acquisition

It's been several years since there's been an opportunity to buy a brand new townhome in Melbourne's coastal suburb of Mordialloc. Even apartment developments in recent times have been few and far between in the area.

Local developer LDS Property identified the gap in new housing, securing a site on White Street, directly opposite&nbsp;Woodlands Golf Club Mordialloc. They've recently launched&nbsp;<a href="https://www.apartments.com.au/new-townhouses/wm-residences-mordialloc-102-white-street-mordialloc-vic-3195">WM Residences</a>, just 13 townhouses which they have already started building.

Projects by Buxton Director Heath Thompson, who is selling WM Residences, says the townhouses x that perfect middle ground be

"Mordialloc residents have had limited options to downsize within the suburb, often forcing them to look elsewhere despite long-standing ties to the area," Thompson says.

"With very little comparable new supply coming to market, projects like WM Residences are well placed, particularly as buyers look to capitalise on current conditions amid constrained supply."

[smartcode_project:default project_id=134646 project_image_fid=6109]

The development, designed by regarded architecture firm&nbsp;<a href="https://www.apartments.com.au/architects/ewert-leaf">Ewert Leaf</a>,&nbsp;adopts a deliberately restrained architectural approach, focusing on simplicity, durability and liveability rather than overt design gestures.

The boutique scale is central to the offering. With only 13 three-bedroom residences, each home is configured to prioritise functional layouts and everyday use, supported by private terraces and secure two-car garages.

Ewert Leaf’s design response leans into a calm, neutral material palette. Interiors are defined by oak flooring, white walls and soft finishes, creating a consistent and understated backdrop. The approach avoids trend-driven detailing in favour of longevity, with an emphasis on natural light and spatial clarity.

[smartcode_project:default project_id=134646 project_image_fid=6110]

Beyond aesthetics, the homes are designed to meet contemporary performance expectations. Each residence targets a minimum 6-star energy rating, incorporating double glazing, comprehensive insulation and all-electric Bosch appliances.

The project’s location supports a walkable coastal lifestyle, sitting within close proximity to Mordialloc’s foreshore, Main Street retail strip and the train station. Local cafés and dining venues, including Suburbia Deli and Hendriks Café, are within a short walk, reinforcing the area’s established neighbourhood character.

[smartcode_project:default project_id=134646 project_image_fid=6116]

While <a href="https://www.apartments.com.au/developments/mordialloc-vic-3195">Mordialloc</a> is often defined by its beach and pier, the project taps into other areas of day to day living, offering easy access to local food, casual dining and transport, rather than positioning itself purely as a lifestyle retreat.

WM Residences reflects a continued trend across Melbourne’s coastal suburbs towards smaller-scale, design-led townhouse developments, particularly on infill sites where proximity to amenity is already established.

With construction commenced prior to its market entry, the project aligns with a growing preference among buyers for developments with visible progress and defined delivery timeframes.

[smartcode_project_cta:default project_id=134646]

WM Residences fills gap in Mordialloc townhouse market

Retail

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A Beaumaris property leased to national retailer IGA sold to an investment syndicate for $7.03 million at auction last Friday.
There was a new 10-year lease, with the net yield reflecting 3.6%.
There were seven bidders, including two offshore investors. The underbidder was a local Beaumaris investor when the freestanding building on a 810 square-metre site offered through CBRE's Victorian retail investments team, comprising Justin Dowers, Rorey James and Josh Rutman.
The 6-12 South Concourse property (pictured above) currently generates a net income of $265,743 per annum. It last sold for about $262,000 in 1975.
In nearby Mentone, a local investor paid $6.2 million for nine ground floor shops and 46 car parking spots on a 2,500 square-metre site in Florence Street. The yield was 2.98% with a net passing income of $193,000 pa.
At Hampton, Fitzroys has sold a two-level freehold building at 411 Hampton Street, at auction for $1.4 milliono.
 
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Mark Talbot sold a two-level freehold building situated within the popular Bayside shopping strip for the Kaufman family who had owned it for 30 plus years.
Situated on a land area of 164sqm approx, the property comprises a double-storey brick building of 184 square metres, consisting of ground floor retail plus a separately let large two-bedroom apartment on the first floor. 
Zoned Commercial 1, the property was sold with the ground floor area vacant and the first floor let, returning $16,320 per annum.
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jchancellor-FAypfDUnLy

Bayside Beaumaris, Mentone and Hampton secure strong retail sales

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The Pie Face premises on Flinders Street, Melbourne - 38 square metre premises - have been sold for $92,105 per square metre.
The $3.5 million sale of Shop 2 at 250 Flinders Street opposite Flinders Street Station was struck on a 4.4% initial yield.
The property is leased to popular retailer Pie Face on a five year lease with further five year option had actually been expected by Colliers International to fetch in excess of $3.5 million.
The 24-hour Pie Face outlet sits on corner of Degraves Street. 
The lease yields $152,987.02 plus GST and outgoings, plus a 4% annual increase.
<a href="https://rca.colliers.com.au/property-retail-vic-melbourne-501216643" target="_blank">Shop 1</a>, leased as a travel agency, sold at auction last month for $2.33 million on yield of 3.6%, representing $61,316 a price per square.
Property Observer gleans the 2012 sale price of strata retail space at 97 Swanston Street at a rate per square metre of $184,214 holds the record for a CBD strata-titled shop.
A Vietnamese buying syndicate purchased the shop at an initial 4.7% yield from a syndicate associated with Cedric Fuchs for $2.579 million.
The $184,214 square metre price surpassed the level set by the neighbouring Telstra store in earlier in 2012, when the 65 square metre Telstra store on the corner of Swanston Street and Collins Street <a href="/expert-insights/investing/private-investor-snaps-up-collins-street-telstra-store-premises-for-9-25-million-ahead-of-auction">was sold by Sydney's Fuchs family for $142,300 per square metre.</a> Cedric Fuchs was one of the founders of Charter Hall.
The Telstra store was bought by South Yarra investor Ken Biddick, a sporting goods wholesaler.
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Pieces of the Melbourne CBD strata retail pie proving popular

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GUEST OBSERVATION
I've had several calls from journalists around the country over the past month, all with a common thread to their stories - one of rejuvenation.
It runs something like this. From the Gold Coast highway, Chapel Street and Bridge Road in Melbourne, Oxford Street and Campbell Parade in Sydney, we are in a state of gentle retail decay at the small end of town. 
Each of these areas is experiencing a lower historic occupancy rate than any time in the last 14 years. And it's all based around small stores, owner occupied or owned by small family trusts or self-managed super funds. 
The CBD and close to CBD areas in all of our cities are being rejuvenated by money from the big end of town. 
Why the split?
Well the whole of the small end of the commercial property sector is dominated by these three groups: owner-occupiers, family trusts and SMSFs. And that tends to be lazy money. Now I'm not being rude or judgmental, it's just an observation.
At the small investor level, residential property tends to be funded by negative gearing from salaries. A residential unit that is unoccupied for a few weeks hurts the individual's cash flow. You may get a tax break at the end of the year, but you need to fund the rent and interest gap quickly or it hurts your lifestyle. I have friends who will throw in a free Samsung TV to get a 12 month residential lease on a unit.
With small commercial retail space it tends to be different. 
As the ownership is via a company, the cash flow effect of an empty shop front isn’t personal. Sure the fund makes a poorer return that year, but nobody has to take money from their salary cheque to fund the gap between rental income and interest payments. 
So the small commercial end stays empty longer and has very few incentives, beyond “have six months free rent for a two year lease”. And as they decay, there is less and less landlord investment in them. 
If you've ever seen behind the scenes in many old high street store fronts, you'd wonder why anybody would work there each day.
So the answer? 
Well other than the normal cycle of new owner-occupiers, trust funds or SMSFs buying these sites and re-investing to bring them closer to new large commercial developments, it's unlikely it'll improve much. 
Current landlords can drop rents further, but at some point somebody has to invest, renew and rejuvenate. Otherwise our high street retail will decay and die the same way as most of Europe's.
Kevin Moore is a retail expert and the chairman of <a href="https://crossmark.com.au/">Crossmark Asia Pacific Holdings</a>.
This article first appeared on <a href="https://www.smartcompany.com.au/" target="_blank">SmartCompany</a>.
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po-LsXgBTHBmX

Why small high street stores are in decay

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International fashion brands H&amp;M, UNIQLO, Zara and Gap have all been confirmed as tenants for the Macquarie Centre, North Ryde shopping centre's second stage of development, set to open on 16 October.
An AMP announcement said that Macquarie Centre will have more large-format overseas brands than any other shopping centre in the country.
Another international brand is expected to be announced in the coming weeks, with speculation that it will be American fashion retailer Forever 21.
Forever 21's first Australian store was <a href="https://www.smartcompany.com.au/marketing/sales/34690-forever-21-joins-raft-of-fashion-retailers-entering-australia" target="_blank">announced in November 2013 for Brisbane's Queen Street Mall</a>, with plans to open in mid-2014. However, the store which will neighbour the new Zara shop, has not yet opened,.
Macquarie Centre will be <a href="/expert-insights/investing/h-ms-first-sydney-store-set-for-a-16-october-opening-at-macquarie-centre-north-ryde">H&amp;M’s first Sydney store</a> and <a href="/expert-insights/investing/uniqlo-to-open-macquarie-centre-store-later-this-year">UNIQLO’s second New South Wales offering</a>. 
The first stage of the Macquarie Centre <a href="/expert-insights/investing/sydneys-largest-suburban-shopping-centre-amp-capitals-macquarie-centre-now-open">opened earlier this year</a>. 
The $440 million transformation also includes Myer, David Jones and 130 speciality fashion and beauty stores. These range from Sass &amp; Bide, Zimmerman and Willow to Alice McCall, Gorman and Scanlan Theodore.
Macquarie Centre will be the largest suburban shopping centre in New South Wales, spanning 138,500 square metres of floor space.
AMP Capital's $2.8 billion shopping centre pipeline also includes major redevelopments at the Gold Coast’s Pacific Fair, Ocean Keys in Perth and proposed redevelopments of Perth’s Karrinyup, Booragoon and Garden City.
AMP Capital Shopping Centres managing director Bryan Hynes said that the centre includes international brands, and established local brands, as well as aspirational fashion retailers, unique leisure and lifestyle retailers and fresh food offerings.
“Macquarie Centre will be transformed into a leading fashion, lifestyle and leisure hub for Sydney with the first and highly anticipated H&amp;M, the first UNIQLO in the city’s north and Zara will be the only store on Sydney’s north side to stock a full children’s range, complementing the strong children’s offer from H&amp;M, UNIQLO and Gap,” he said.
“We have some grand plans for when our doors open on 16 October including two fashion shows curated by fashion industry experts to showcase everything we will have on offer at Macquarie Centre.”
A dining and café precinct, 5,000 car spaces, valet parking, porter shopping and free WIFI will be in the centre. Coles, ALDI and a refurbished Woolworths will be in the Fresh Food Market, including eateries Costi’s Seafood Market Macquarie, Inlakesh Living Foods and F&amp;L Gourmet.
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jduke-EHk3XBmHkn

Zara, Gap, H&M and UNIQLO announced for Macquarie Centre, North Ryde

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Sydney’s Newtown Central, a retail centre in the inner west suburbs, is up for sale.
It is a three level centre that underwent a full refurbishment in 2009 and includes leases with Foodworks, Fitness First and Cellarbrations on the highly trafficked King Street. These three tenants secure approximately 70% of the income.
It has housed a hair dresser and an Optus shop.
Close to Newtown train station, the current owners Monash Private Capital Pty Ltd and Diamong Properties note that convenience retail is a highly desirable asset class.
“Since acquiring this asset we have applied an active management plan in which we have undertaken several lease renewals and identified areas where we have successfully added value to the property,” said Monash Private Capital’s Joey Fridman.
The selling agents behind the property, Colliers International’s James Wilson and Savills’ Steve Lerche, have the opportunity offered to market via <a href="https://www.realcommercial.com.au/property-retail-nsw-newtown-501273899" target="_blank">expressions of interests closing on 30 September</a>.
“The shopping centre investment market has been driven by the combination of a large capital injection, historically low interest rates and a lack of quality opportunities comparable to Newtown Central,” said Wilson.
“The prime location of the supermarket anchored neighbourhood shopping ensures a captive market with exceptionally difficult barriers of entry for competition,” said Lerche. 
They expect strong interest in the property, which comes with basement car parking for 33 vehicles and 18 strata spaces opposite. It is on 1,574 square metres of land and covers 3,385 square metres of floor area.
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Newtown Central, King Street retail centre up for grabs

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The long-time owner of 160-162 Lygon Street, Carlton secured $3.66 million at recent auction, just shy of the strip's all-time record.
The 684 square-metre commercial building came with a six-year lease to long-term tenant, BC’s Bar Centrale at an annual rental of $166,472, reflecting a 4.5% rental yield.
Teska Carson handled the auction for the vendor, the Bussolaro family who had held the ­property for 45 years.
Located on the corner of Argyle Place East, the three-storey building includes a ground floor café and bar, a function room with a commercial kitchen and a caretaker’s unit.
<a href="https://www.realcommercial.com.au/property-retail-vic-carlton-501173731" target="_blank">The 250 square-metre site</a>, zoned Commercial 1, includes an 11-metre frontage to Lygon Street.
In absolute terms, the highest price paid since 2008 was $3.71 million in 2009 for 350 Lygon Street, a two-level corner site measuring 173 square metres, equating to $21,445 per square metre.
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Lygon Street retail sale at $3.66 million

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GUEST OBSERVATION
The Lazarus of the Australian economy – consumer spending – seems to be starting to recover from the dead zone created by budget related shocks. But how long can it last? The long-term prognosis remains troubling.
A growth recession?
As I am sure all readers will recall from their school days, an oxymoron is a combination of contradictory words. Cruel kindness, for example. The term comes from the Greek for ‘pointedly foolish’, but those in Australian retail property may be feeling that the somewhat oxymoronic-sounding ‘growth recession’ is more serious than that.
Virtually none of the federal government’s cuts and increased costs are likely to pass through the Senate. This is good news for the retail sector; if some of these measures were to make it through annual household income would drop by over $600, causing big spenders on low to medium incomes to think twice about splashing out on the next big purchase.
While a small bounce back in consumer confidence has seen a slight pick-up in retail sales over the last few weeks, this may not be enough to save spenders from having to tighten their belts and save the retail property sector from pain. For over five quarters Australia has registered annual growth at less than 1%, which is disturbingly news considering Australia’s population growth stands at 1.8%.
It’s almost like a recession on an economic growth per capita basis and that is why things are, and are likely to remain, tough for retail.
GDP per capita is moderating…
<img class="alignleft wp-image-6871" src="https://www.btim.com.au/media/GDP1.png" alt="GDP" width="550" height="306">
GDP per capita: % change quarter on quarter chain volume measures. Source: BT Investment Management.
…affecting retail sales in 2014
<img class="alignleft wp-image-6870" src="https://www.btim.com.au/media/Retail-Turnover1.png" alt="Retail Turnover" width="550" height="295">
Retail turnover (SA). Source: BT Investment Management.
There’s a strong warning signal for retail sales
Over the past three years interest rate cuts have prompted some improvement in retail sales. Even with rates kept at historic lows this streak won’t continue. Australians just aren’t interested in borrowing – they’re keeping 24 months ahead of their mortgage repayments and getting better at saving. Consumers have already stopped spending on big ticket items like overseas holidays and cars – new car sales are falling 3% year on year.
Looking to the future, there’s one warning signal investors must not miss – household income growth has dropped from 11% in 2007 to just 3.5% in 2013. This typically correlates with a 2% drag on retail sales, which, closely followed by falling rents, weakens retail property yields.
What it will take for conditions improve?
There’s still a world of opportunity in retail property if you know where to look. Very high population growth in Australia (the highest in the developed world) ensures continued demand for quality shopping centres, but there are some major challenges ahead – rising online sales, the growth recession and lacklustre pay rises will be compounded when interest rates rise once again.
For a sustained increase in retail spending and a retail property boom, we need to see improving income growth, solid house price growth and growing confidence in the economy and the federal government.
Julia Forrest is REIT portfolio manager at <a href="https://www.btim.com.au" target="_blank">BT Investment Management</a>.
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Major challenges remain for retail property

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A new Hungry Jacks property, north of Adelaide, has sold at auction for $3.5 million to a local private investor.
The Savills sale reflected a 5.4% yield.
The Playford Alive town centre property has a building area of 184 square metre on its 1,971 square metre site.
There is a 10-year lease from June 2014 with three further five-year options.
The property sold through Peter Isaksson and Rino Carpinelli of Savills South Australia on behalf of Adelaide-based developer GIC Australia Pty Ltd.
Playford Alive is 30 kilometres north of the Adelaide CBD, one of Australia’s most significant urban renewal projects.
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Adelaide Hungry Jacks sells at 5.4% yield

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Super Retail Group, owner of brands including Rebel Sport and Supercheap Auto, has reported a 5.6% jump in profits for 2014.
The retail group’s net profit after tax rose to $108.4 million, while revenue lifted by 4.6% to $2.11 billion.
Super Retail Group managing director and chief executive Peter Birtles said in a statement the result, while in-line with forecasts, reflected mixed performance across the group.
Birtles said the auto retailing division was an outstanding performer with around 10% growth, but the company’s leisure and sports retailing arms had lagged.
“In the leisure retailing division, the BCF business was impacted by a slowdown in sales in stores that had previously benefited from investment in the mining industry,” said Birtles.
“The sports retailing division had a solid start to the year but performance was impacted by inventory supply challenges resulting from the implementation of new merchandise and supply management systems in October and from a slowdown in customer demand following the federal budget and a warmer start to winter.”
This article first appeared on <a href="https://www.smartcompany.com.au/" target="_blank">SmartCompany</a>.
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Super Retail Group reports 5.6% jump in profits

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Shopping centre income growth is expected to be steady but falling behind CPI for the next five years, according to BIS Shrapnel’s Retail Property Market 2014 to 2024 report.
According to senior project manager and report author Maria Lee, there are a number of factors that are constraining income growth prospects. These fundamentally relate to economic growth and household spending in aggregate.
Lee pointed to these four reasons:
<ol>
<li>Modest GDP growth as the economy transitions away from resources investment to more broadly-based growth.</li>
<li>Slowing population growth as 457 visas decline and net long term departures increase.</li>
<li>Household disposable income growth averaging just 2.6% per annum compared with a 25 year average of 3.3%.</li>
<li>Retail turnover growth averaging 2.9% per annum—slightly ahead of income growth due to an easing in the savings rate, but well below the 3.8% long-term average.</li>
</ol>
<img src="/images/2014/08/20/chart%20of%20the%20day%20aug%2020%20breakout.png" alt="">
Source: <a href="https://www.bis.com.au/" target="_blank">BIS Shrapnel</a>, ABS.
Lee also pointed to factors that impact the distribution of aggregate expenditure between physical shops and online, as well as between differnet shopping centres. Online shopping, for instance, was estimated to be set to remove 0.5% per annum from turnover growth to shopping centres and retail building commencements hitting a new high over the next financial year having an effect.
“Add all these factors together, and we predict that shopping centre incomes will average around 2.6% annual growth over the next five years, failing to keep pace with inflation," she said.
“The saving grace for shopping centres is that the bulk of their income is subject to fixed annual escalations, putting a support under the rate of growth and reducing volatility from year to year."
The report suggested that retail investors work to mitigate the impact by changing tenancy mixes, marketing in smarter ways to consumers and even adding attractions.
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