The new <a href="https://www.apartments.com.au/new-apartments/yarraville-green-42-stephen-street-yarraville-vic-3013">Yarraville Green</a> development in Melbourne's inner west is showing that landscaping can be just as influential as architecture, with buyers responding strongly to the garden-first approach adopted from the outset by developer Excelon Projects and the project's design team.

Excelon appointed Six Degrees Architects and landscape architects SBLA to work collaboratively on the development, with a brief to create "a sustainable, design-led building with a focus on community."

That approach has resonated with buyers. According to Next Chapter Director Tom Hirini, who is leading the sales campaign, the landscaped communal garden has become one of the project's defining features, alongside its boutique scale and European-inspired cluster housing concept.

Local downsizers, right-sizers and established families already living in Yarraville and surrounding suburbs have accounted for the majority of purchasers.

[smartcode_project:default project_id=144913 project_image_fid=297740]

Yarraville Green will comprise 53 homes, including apartments and townhomes, arranged around the shared central garden to maximise connections to the landscaped open space. Parking has been moved underground, allowing the ground plane to be dedicated to greenery, pedestrian movement and communal spaces.

The landscape extends well beyond passive planting. Productive garden beds, a pergola, communal gathering spaces, garden sheds and a pet wash have all been integrated into the masterplan, creating spaces designed to encourage everyday interaction between residents.

[smartcode_project:default project_id=144913 project_image_fid=297741]

The interiors continue Excelon's focus on craftsmanship, incorporating bespoke elements by Melbourne artisans including leadlight detailing by Adadaz, hand-turned timber hardware by Auburn Woodturning and blown-glass lighting by Ruth Allen.

Sustainability has also been embedded throughout the project, with Yarraville Green targeting an average 7-star NatHERS energy rating through passive design principles, rooftop solar servicing common areas and rainwater harvesting for landscape irrigation.

[smartcode_project:default project_id=144913 project_image_fid=297735]

Construction continues to progress at Yarraville Green, with structural works well underway and framing works approaching completion under builder Balmain &amp; Co. The project remains on track for completion in mid-2027.

Apartments at Yarraville Green are currently priced from $625,000, while townhomes start from $1.4 million.

[smartcode_project_cta:default project_id=144913]

Joel Robinson

Garden-led design drives buyer demand at Yarraville Green

National diversified developer Fortis has officially launched Crest &amp; Walker, its latest Brisbane apartment development, with construction now underway on the 20-storey Newstead project.

Award-winning builder BINAH has commenced construction on the Bureau^Proberts-designed building, which will deliver a limited collection of 65 two and three-bedroom apartments on Kyabra Street.

[smartcode_project:default project_id=145922 project_image_fid=373556]

The project marks Fortis' fourth active residential development in Brisbane, following River House, which is nearing completion, alongside projects in New Farm and Hamilton as the national developer continues to expand its South East Queensland pipeline.

Fortis General Manager – Development Queensland Dan Boman said Crest &amp; Walker reflects the developer's long-term commitment to delivering design-led residential projects in Brisbane's established inner-city suburbs.

"We're proud to be strengthening our presence in Brisbane with Crest &amp; Walker, particularly in such a sought-after lifestyle destination as Newstead," Boman said.

"Every Fortis project is shaped by its context, and we approach each one with the respect and care it deserves.

"Our focus is always on creating places that feel connected to their neighbourhood and elevate the everyday experience for residents. Newstead continues to evolve as one of Brisbane's most sought-after urban communities, and Crest &amp; Walker reflects our ambition to contribute meaningfully to that story."

[smartcode_project:default project_id=145922 project_image_fid=373559]

Positioned between Gasworks Plaza and James Street, <a href="https://www.apartments.com.au/new-apartments/crest-walker-newstead-12-kyabra-street-newstead-qld-4006">Crest &amp; Walker</a> has been designed as a boutique residential address offering privacy and generous living spaces within one of Brisbane's most established lifestyle precincts.

The building features a contemporary brick podium softened by integrated landscaping, while the upper levels are characterised by restrained architecture and enduring materiality. Interiors have been designed to maximise natural light, acoustic performance and long-term liveability.

[smartcode_project:default project_id=145922 project_image_fid=373583]

Residences comprise spacious two and three-bedroom floorplans, with two-bedroom apartments priced from $1.55 million and three-bedroom, half-floor residences from $3.95 million.

Residents will have access to a wellness-focused rooftop featuring a swimming pool, sauna, steam room, landscaped dining spaces and outdoor lounge areas overlooking Newstead and the Brisbane CBD.

[smartcode_project:default project_id=145922 project_image_fid=373571]

Sales are being managed by Slaite Projects, with Fortis expecting strong demand from owner-occupiers seeking a high-quality, design-focused apartment in one of Brisbane's most tightly held inner-city suburbs.

Completion of Crest &amp; Walker is slated for late 2028.

[smartcode_project_cta:default project_id=145922]

Fortis expands Brisbane pipeline with launch of Crest & Walker in Newstead

The enormity of delivering a true skyscraper in Australia's new development market is often overlooked.

It has taken the best part of a decade since plans for Chevron One were first unveiled, but the 40-storey tower is now complete, with residents collecting their keys and moving into what has become one of the Gold Coast's most recognisable new landmarks.

Rising 127 metres above Chevron Island, Chevron One stands almost twice as high as any other building on the island. Its scale places it alongside the trio of towers at Jewel, arguably the last truly significant addition to the central Gold Coast skyline when they were completed around six years ago.

While there are several developments underway around a similar height to Chevron One, they are more concentrated within clusters of the highest towers in the city. The fact Chevron One sits within a developing precinct, looking back at the other high-rise developments in Surfers Paradise and Broadbeach, makes it a different proposition altogether. It will certainly become a reference point on the Gold Coast skyline.

[smartcode_project:default project_id=6515 project_image_fid=68833]

Developer Bensons Property Group is behind the 40-storey tower, which has just shy of 230 apartments, along with an exhaustive list of resident amenity spread across what is the largest development site ever assembled on Chevron Island.

The tower has been the talk of the town for years, says Ray White Projects Gold Coast agent Caitlin Rosenboom, who is selling the remaining apartments.

"People have been watching Chevron One go up for years," Rosenboom says, adding that many prospective buyers have been surprised by the scale of the views once they step inside.

"It's only when they walk through a completed apartment that they truly understand the position of the building," Rosenboom says.

"The views are jaw-dropping. Whether you're looking east over the ocean, across Surfers Paradise, along the river systems or out to the hinterland, every level offers something different but equally impressive."

[smartcode_project:default project_id=6515 project_image_fid=360215]

One of Chevron One's defining advantages is its location on the eastern side of Chevron Island on Stanhill Drive, a position which protects the views forever.

"There's only one row of houses between Chevron One and the water, and the height restrictions along the river means views from Chevron One can never be built out,"&nbsp;Rosenboom says.

While new apartment developments continue to emerge across the Gold Coast, Rosenboom says opportunities to secure a completed apartment with this level of outlook are becoming increasingly rare.

"The size of the site is something that would be incredibly difficult to replicate today," she says.

"That's allowed Chevron One to deliver the sort of amenity, open space and resident facilities that very few projects can offer. There are not many completed apartment buildings on the Gold Coast right now that can compete with the combination of scale, quality and amenity."

[smartcode_project:default project_id=6515 project_image_fid=68839]

There's around 2,000 sqm of amenity solely for the use of residents of Chevron One. Club One features a uniquely shaped swimming pool that mirrors the footprint of the building itself, set within a extensively landscaped gardens. There's also an indoor pool and spa, a fully equipped gym with a Pilates room, a yoga garden, a bookable private dining area and lounge that can host up to 30 people, and a 24-hour concierge service.

As for the buyers, Rosenboom is fielding enquiry from everywhere: Sydneysiders and Melburnians looking at the new and off-the-plan market following the changes in the Federal Budget, as well as those looking to relocate, through to South East Queenslanders seeking either a permanent home or a weekender bolthole.

"The Gold Coast lifestyle continues to resonate with people relocating from the southern states, and when they see the views and the quality of what's been delivered at Chevron One, it becomes very easy for them to understand the appeal," Rosenboom says.

A diverse mix of one, two and three-bedroom apartments remain available, with each offering "something a little different", be it the orientation and views, configuration, or level, to suit a wide variety of buyers.

The remaining apartments are ready to inspect in person, by appointment.

[smartcode_project_cta:default project_id=6515]

A decade in the making: Residents to move into Chevron One as construction wraps up

A general rule of thumb in new apartment developments is that the penthouses get the rooftop.

It's a formula that's become commonplace across Australia's apartment market. Residents might have access to a pool, gym or barbecue facilities on a dedicated lower level, but the most desirable outdoor spaces are typically reserved for the highest-priced homes at the top of the building.

<a href="https://www.apartments.com.au/developers/sherpa-property-group">Sherpa Property Group</a> has taken the opposite approach.

Rather than dedicating the rooftop to a handful of buyers, the Gold Coast developer has made it the centrepiece of its Flourish collection, creating expansive shared spaces from the best vantage point in the building.

The philosophy has reached its most ambitious expression at <a href="https://www.apartments.com.au/new-apartments/flourish-soleira-palm-beach-1150-1160-gold-coast-highway-palm-beach-qld-4221">Flourish Soleira</a> in Palm Beach, where two rooftop precincts connected by a skybridge will deliver one of the most extensive lifestyle offerings seen in a residential apartment project on the Gold Coast.

[smartcode_project:default project_id=150017 project_image_fid=374053]

"We're seeing a clear move toward developments that offer more than just an apartment," Sherpa Group founder Christie Leet said.

"People want spaces that support how they actually live, whether that's working from home, staying active, or spending time with family and friends.

"That's where amenity becomes critical. It's not just about what's included, but how those spaces are designed to be used every day."

[smartcode_project:default project_id=150017 project_image_fid=374052]

The breadth of amenity has already attracted buyers across multiple demographics. Younger first home buyers have been drawn to Soleira's one-bedroom apartments, a product rarely delivered in Palm Beach, while families have responded to practical inclusions such as the shallow children's pool adjoining the main lap pool and the extensive communal recreation areas.

Instead of a single rooftop, Soleira delivers two distinct lifestyle zones.

[smartcode_project:default project_id=150017 project_image_fid=372547]

The southern rooftop has been dedicated to wellness, featuring a gym, yoga and Pilates studio, work-from-home facilities, a wellness centre, spa, and hot and cold plunge pools.

The northern rooftop focuses on recreation and entertaining, incorporating a heated resort-style pool, private dining rooms, pizza ovens, barbecues, a golf simulator, children's recreation areas, and what is expected to be the Gold Coast's first rooftop basketball court, which will also double as a squash court.

[smartcode_project:default project_id=150017 project_image_fid=374054]

Beyond the rooftops, Soleira will introduce 1,500 sqm of curated retail beneath the towers, creating one of Palm Beach's first genuinely mixed-use lifestyle precincts where cafés, restaurants and convenience retail become part of residents' everyday lives.

Sherpa has also retained management rights across the development, allowing it to oversee the long-term operation of the building through a 24-hour concierge model. The developer is also exploring additional revenue streams within the precinct aimed at helping offset ongoing body corporate costs for residents.

[smartcode_project:default project_id=150017 project_image_fid=370962]

While Soleira is the largest project Sherpa has delivered, the rooftop-first philosophy has been evolving for several years.

It began with <a href="https://www.apartments.com.au/new-apartments/amargo-6-12-sixth-avenue-palm-beach-qld-4221">Flourish Amargo</a>, the first project released under the Flourish brand. Rather than competing at the ultra-luxury end of the market with oversized half-floor and full-floor residences, Sherpa focused on creating lifestyle-driven apartments supported by resort-style shared spaces.

Amargo introduced more than 800 sqm of rooftop amenity, combining wellness facilities, heated pools, entertaining areas, cabanas, pizza ovens and private dining spaces into what was designed as an extension of residents' homes rather than a facility used only occasionally.

[smartcode_project:default project_id=146527 project_image_fid=366550]

That approach continued with Flourish Oasis, where the same amenity-led philosophy was refined into a more boutique development. Strong demand from Sherpa's growing VIP database saw much of the project sold before it reached the broader market, reinforcing buyer appetite for apartment communities centred around shared lifestyle experiences.

Flourish Amargo is slated for completion mid-way-through next year, with Oasis to be delivered by late 2027. Flourish Soleira is expected to complete in 2030.

[smartcode_project_cta:default project_id=150017]

Sherpa takes amenity to the sky as Flourish Soleira captures booming Palm Beach demand

As apartment living continues to evolve across Sydney's growth corridors, the quality and distribution of shared spaces is increasingly shaping how residents experience home. Rather than functioning as add-ons, amenities are being embedded into the daily rhythm of a building, supporting everything from quiet retreat to social interaction, often within a single vertical community.

At <a href="https://www.apartments.com.au/new-apartments/aeris-melrose-park-nursery-street-melrose-park-nsw-2114">Aeris</a> in Melrose Park, this approach is resolved through a layered amenity offering that unfolds from ground level through to its upper podium. Developed by <a href="https://www.apartments.com.au/developers/sekisui-house-australia">Sekisui House Australia</a> in partnership with Hankyu Hanshin Properties, the project introduces 468 apartments across two towers and a mid-rise building, positioned at the highest point of the broader masterplan.

[smartcode_project:default project_id=426 project_image_fid=359199]

The amenity experience begins at street level, where two courtyards sit within a landscaped setting that connects residents to the wider network of parks and green spaces. These green spaces are not isolated pockets but part of a wider pedestrian network that links Aeris to the surrounding <a href="https://www.apartments.com.au/developments/melrose-park-nsw-2114">Melrose Park</a> precinct, including Central Park, future schools, and the Town Centre opening in July 2026. The result is a transition that moves from public to private without abrupt boundaries, allowing residents to pass through shaded, tree-lined environments before reaching the building itself.

Moving upward, the focus shifts to the level five podium, where the primary communal facilities are concentrated. This space brings together a 16-metre swimming pool, outdoor seating areas, and a communal BBQ zone arranged to take advantage of elevated outlooks. Seating is positioned beneath pergolas, creating pockets of shade that extend the usability of the space throughout the day. The pool edge aligns with views toward the wider district, reinforcing the sense of elevation that defines the project’s positioning.

In the adjacent building, this is complemented by quieter, more contemplative spaces, including an outdoor cinema set within the same level. Positioned to operate primarily in the evening, it introduces a different tempo to the shared environment, shifting from daytime activity to after-hours use without requiring separate zones.

[smartcode_project:default project_id=426 project_image_fid=360299]

The podium also accommodates an intimate private resident gym. Located on the lower levels, it gives residents convenient access to fitness facilities without leaving the building.

Above, the elevated podium sky deck extends the amenity offering, providing additional open-air spaces with elevated outlooks across the surrounding landscape. While more restrained in program, this upper level reinforces the project’s vertical progression, from ground-level greenery to elevated outlook, allowing residents to move between distinct spatial conditions within a single address.

This distribution of amenities reflects a deliberate response to how residents use space across the day. Sekisui House Australia Sales and Marketing Director Peter Kalaf points to the role these shared areas play in shaping buyer demand. Aeris has been conceived as more than a collection of apartments, with the podium pool, gym and outdoor cinema forming part of a broader lifestyle offering that extends the home beyond each individual residence.

[smartcode_project:default project_id=426 project_image_fid=360300]

What distinguishes Aeris is not the inclusion of these elements individually, but how they are arranged in relation to one another. Active, social, and passive spaces are layered vertically rather than separated, allowing residents to choose between them without leaving the building or moving far from their apartment. This proximity supports both routine use, such as a morning swim or evening workout, and more occasional gatherings, whether around the BBQ area or within the cinema setting.

The amenity design also sits within a broader framework of connectivity across Melrose Park. The Melrose Park Town Centre, anchored by Coles and Dan Murphys, features a mix of retail, dining, health and lifestyle offerings, bringing everyday convenience closer to residents. By the end of the year, more than five hectares of parks and open space, equivalent to around seven football fields of green space on residents' doorstep, will further enhance the precinct, allowing the internal facilities at Aeris to operate as an extension of the wider neighbourhood rather than a substitute for it.

Construction at Aeris continues to gather momentum, with ground floor slabs expected to be completed in late 2026 before the first sections of the buildings begin to rise above ground.

[smartcode_project_cta:default project_id=426]

Elevated amenity anchors daily life at Aeris, Melrose Park

Retail

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Remember when our retail spend was shifting from buying things to buying experiences? That was only four months ago.
Since then, Australians have been spending more at supermarkets and on consumer electronics than on apparel and at department stores. Our expenditure on experiences, in particular travel, has been almost non-existent. It was therefore interesting to hear that in China there has been a rebound in luxury spending post COVID-19 lockdowns.
(Spending excessively after a period when one has had limited opportunities to spend has emerged after the lockdown, where in several Chinese cities, consumers flocked the various brand outlets to beat the lockdown blues.)
The most recent retail trade data for May did show an element of ‘revenge spending’ by Australian consumers. After plunging 17.7% in April, spending bounced back 16.3% in May. June is likely to look similarly positive, although, the Melbourne lockdowns are likely to start to drag it back again in July.
At the beginning of the first lockdown in mid-March, I thought that the most impacted property sector would be shopping centres, but it has remained surprisingly resilient despite the enormous challenges for retailers.
While the sector has remained somewhat resilient, the vacancy rate has risen. According to JLL, the national average shopping centre vacancy rate rose to 5.1% in June from 3.8% six months earlier. This rate excluded temporary closures.
By far the most impacted precincts have been CBDs where the vacancy rate has now hit 10%. Working from home has been disastrous for CBD retailing. The other big shift has been the acceleration of online retailing. In a three-month time period, it has gone from 9% of retail sales to 10.5%. Not exactly a runaway pace but a sharp increase over a short time period.
For now, our expenditure on travel, eating out and entertainment outside the home is likely to remain far more muted. Meanwhile expenditure at supermarkets and on takeaway food is likely to be far more positive. While I can’t see myself rushing out to buy luxury brands any time soon, the rush to the shops in China is hopefully a good news story for shopping centres over the next 12 months.
NERIDA CONISBEE is the Chief Economist at REA
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Can revenge spending help save retail property? REA's Nerida Conisbee

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The long-standing Tewantin Market Garden on the Sunshine Coast has been snapped up for $1,025,000.
The 142sqm property at Shop <a href="https://ecomms.raywhite.com/collect/click.aspx?u=OEliUjcxeWE1ZEs2R3BZaUU4MjFYTFMzUWNUeUVSUVRzYlJqamhlUkd0Z1UrTkh0T2JQYy9wMGZuVUhVano0UzFCZkZoZXJucy9NUFVacFZLaE4rcWVBVFJXTjhhYTUxZW5oU2VlbXg0RVFxYUhQZDVxcitXZ1hKZTJKWlRYUE1FbVp4STQxOXJhd3BOcXkrNVM4TE1jMXc5M3hpZ3BkSTFseFNRMG1tZ1BOTTJIbkVUUDF1M3M1OFYreC9sNGI3&amp;rh=ff00611b95e6ae1e74f00323784ab13e69fb5d9d" target="_blank" rel="noopener noreferrer" data-auth="NotApplicable">2/93 Poinciana Avenue</a> was completed in 2016 and formed part of the ‘Tewantin Place’ strata complex.
It was sold by David Brinkley and Tracey Ryan from Ray White Commercial Noosa and Sunshine Coast North to an interstate investor. 
Tewantin Market Garden relocated from a below street level position within Tewantin Plaza further up the street. 
<img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2020/5/18/a%20U2%2093Poinciana%20Jul19%204.jpg" alt="">
“The tenants had made the decision to relocate to this site on the Poinciana street front to enhanced their business and benefited their customers," Brinkley said.
The property was first for sale as an off-market proposition until final agreement was reached five months later.    "Tewantin is a busy retail centre which is undergoing a revitalisation as the demographic in the area moves away from retirees to young families investing in the large blocks at prices slightly below neighbouring Noosa," Brinkley said. 
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j.ballantyne1990-6AQqhLzZaK

Tewantin Market Garden freehold sells for $1 million

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The Priceline Pharmacy building in the Sunshine Coast suburb of Caloundra at 66 Bullock Street has been offered to the market
The property, 100 per cent leased to Star Pharmacy Group Pty Ltd, is being offered for sale via an expressions of interest campaign.
The asset is being marketed and sold by Ray White Commercial QLD father and son duo Stephen and Elliot Kidd, in conjunction with Henzells Commercial Real Estate’s Paul Bell.
Mr Stephen Kidd said the two-level commercial building was in the heart of one of the Sunshine Coast’s most popular tourist destinations.
“A new corporate head lease from the Star Pharmacy Group over the entire building is being offered, with the ground floor retail occupied by Priceline Pharmacy and upstairs previously used as a function room,” he said.
“The current net income produces $166,340 after all deductions, including land tax.”
Mr Elliot Kidd said Star Pharmacy Group acquired and refurbished their tenancy in 2016.
“The ground floor income is underwritten by a fresh five-year corporate lease with options until 2045,” he said.
Mr Bell said the upper level comprised open-plan accommodation that was currently fitted out for an entertainment venue.
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Priceline Pharmacy building in Sunshine Coast's Caloundra listed

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EXPERT OBSERVER
March retail trade figures released from the Australian Bureau of Statistics reporting year-on-year growth of 10.1%, were consistent with expectations of strong pre-lockdown specific category growth, whilst the majority of retailers shut their doors for COVID-19 lockdown.
The figures confirm stronger expenditure year-on-year across food (+27.2%), liquor (+33.9%) and pharmacy (+29.4%) categories, and a sales boost in household goods (+10.3%) as Australians adapted to restrictions and stocked up on additional items for lockdown.
March was the eye of the COVID-19 storm for retailers, with all but essential service retailers forced into closure of their physical stores during lockdown. Whilst that pain of closure has continued during April and into May, we have seen some gentle upside begin as many stores enhance their online and delivery services. 
Since the COVID-19 pandemic began, we have anticipated a spike in certain categories as people adjust to restrictions, but these increases mask bigger falls across discretionary categories, which has proved a significant challenge.
It’s been unquestionably tough for retailers, and the true recovery picture won’t start to emerge until physical stores reopen more fully in the coming weeks. We are likely to see a phased re-opening - retailers have different considerations some will open key stores and wait to open others. Some have cafes attached and will need to delay that area opening. Others are still negotiating with landlords.
Whilst we expect Australians to soon celebrate their freedom with one of their favourite leisure activities - shopping - we do anticipate continued caution by consumers for some months forward as they assess overall economic conditions.
Category-specific trends
While month-on-month supermarket sales are up 23% in March, these figures have confirmed our expectations of significant falls in sales across discretionary categories. Clothing, footwear, and personal accessories recorded significant falls (-22.6%).
Retailers have swiftly adapted to the new conditions, with a jump in online sales set to become the new normal.
Online sales have skyrocketed, and we expect that shopping habits we have seen will be permanent, as retailers offer new options such as kerb-side pickup and retail-to-go options.
I anticipate some enthusiasm from consumers as stores prepared for reopening, and said his desire was for the reopening to be sustainable and safe as people returned to retail stores.
The safety of customers and staff is our top priority, and retailers are making every effort to prepare a safe in-store environment. New in-store measures such as social distancing, increased hygiene and cleaning, and Perspex screens where appropriate, will be here to stay, even as restrictions are gradually eased.
ARA will release its Retail Reopening Guidelines tomorrow morning.
Monthly Retail Growth (February 2020 – March 2020, seasonally adjusted)
Department stores (-8.9%), Food retailing (24.1%), Household goods retailing (9.1%), Cafés, restaurants and takeaway food services (-22.9%), Other retailing (16.6%), and Clothing, footwear and personal accessory retailing (-22.6%).
Western Australia (9.9%), Australian Capital Territory (9.5%), Queensland (8.9%), Victoria (7.7%), South Australia (9.4%), Tasmania (8.9%), New South Wales (8.0%), and Northern Territory (11.6%).
Overall month-on-month sales growth: 8.5%.
Year-on-Year Retail Growth (March 2019 – March 2020, seasonally adjusted)
Food retailing (27.2%), Cafés, restaurants and takeaway food services (-22.6%), Other retailing (19.1%), Household goods retailing (10.3%), and Department stores (-6.6%), and Clothing, footwear and personal accessory retailing (-24.9%).
Tasmania (15.1%), Queensland (13.2%), Victoria (9.4%), Western Australia (13.5%), Australian Capital Territory (11.0%), South Australia (10.2%), Northern Territory (10.8%), and New South Wales (7.1%).
Overall year-on-year sales growth: 10.1%.
Paul Zahra is the chief executive of the Australian Retailers Association
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jrobinson-rf4aSBido9

ARA looks towards May as start of retail recovery

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EXPERT OBSERVER
Consumers stockpiled food and supermarket groceries in February ahead of restrictive self-isolation and social distancing measures announced by governments to counter the fast-spreading coronavirus (COVID-19) outbreak.
Retail spending grew by a solid 0.5 per cent in February – the second strongest growth rate in 12 months. But this followed declines in spending of 0.6 per cent in December and 0.3 per cent in January, due to disruptions from big city smoke hazes and the bushfire emergency.
Many Aussie retailers decided to close their businesses before government orders to shut down to protect both the health of their employees and customers from the ravages of the virus. Tens of thousands of workers in the retail trade industry were stood down indefinitely. And shoppers decided to scale-back purchases of non-essential discretionary goods, such as clothing and footwear. In fact spending on shoes and apparel fell by 2.3 per cent over the year to February – the biggest annual decline since 2011.
Consumer caution is also evident in spending on motor vehicles. As Aussies began to hibernate from the virus at home, national new vehicle sales posted their weakest March month in 11 years.
Aussie builders and construction workers are in for a tough time over the next few months. According to the AiGroup, construction businesses reported that, “Economic uncertainty due to the COVID-19 pandemic has dampened client confidence, increased risk aversion and lowered demand. Some businesses reported supply disruptions due to COVID-19 measures, particularly for imported building materials.”
Retail trade – February
‘Final’ retail trade rose by 0.5 per cent in February, above the preliminary Bureau of Statistics (ABS) estimate of 0.4 per cent. The lift in spending follows spending declines of 0.3 per cent in January and 0.6 per cent in December. The annual growth rate fell from 2.0 per cent to 1.8 per cent – the weakest rate in over 2 years.
Non-food retailing rose by 0.2 per cent in February following a 0.8 per cent decline in January. But the annual growth fell from 1.4 per cent to 1.0 per cent – the slowest growth rate in over 2 years.
Sales by chain-store retailers and other large retailers rose by 0.3 per cent in February to be up 1.8 per cent from a year ago – the weakest annual growth rate in over 2 years.
The share of online retailing rose from 5.6 per cent to 6.6 per cent over the year to February.
Spending rose most in February: Department stores (up 3.1 per cent); Pharmaceutical, cosmetic and toiletry goods retailing (up 2.2 per cent); Hardware, building and garden supplies retailing (up 1.3 per cent); and Supermarket and grocery stores (up 1.1 per cent).
Spending fell most in February: Clothing retailing (down 3.1 per cent); Footwear and other personal accessory retailing (down 2.4 per cent); and Newspaper and book retailing (down 2.0 per cent).
Across states/territories in February: Spending rose the most in Western Australia (1.2 per cent), followed by the ACT (up 1.1 per cent), Queensland (up 0.8 per cent), Victoria (up 0.5 per cent), South Australia (up 0.4 per cent). Tasmania and NSW were broadly unchanged. Spending in the Northern Territory fell by 0.7 per cent.
New vehicle sales - March
The Federal Chamber of Automotive Industries reported: “The March 2020 market of 81,690 new vehicle sales is a decrease of 17,752 vehicle sales or -17.9 per cent on March 2019 (99,442) vehicle sales. March 2020 had the same number of selling days as March 2019 (25.5) and this resulted in a decrease of 696.2 vehicle sales per day.”
“The Passenger Vehicle Market is down by 7,222 vehicle sales (-24.9 per cent) over the same month last year; the Sports Utility Market is down by 6,489 vehicle sales (-14.2 per cent); the Light Commercial Market is down by 3,326 vehicle sales (-15.5 per cent); and the Heavy Commercial Vehicle Market is down by 715 vehicle sales (-21.7 per cent) versus March 2019.”
Sales across states and territories over year to March: NSW (down 16.4 per cent); Victoria (down 21.3 per cent); Queensland (down 20.2 per cent); South Australia (down 27.9 per cent); Western Australia (down 14.4 per cent); Tasmania (down 21.2 per cent); Northern Territory (down 33.5 per cent); ACT (up 77.0 per cent).
The biggest selling vehicle in March was the Toyota Hi-Lux (3,556) from the Ford Ranger (3,108) and Toyota RAV4 (2,991).
The rolling annual total of new vehicle sales in March was 1,027,690, down 9.1 per cent on the year after falling 8.1 per cent in the year to February. Passenger car sales fell by 17.6 per cent on the year with SUVs down 2.6 per cent and “other vehicles” down 9.8 per cent.
In the year to March, SUVs accounted for a record 61.7 per cent of combined SUV and passenger vehicle sales.
Services Purchasing Managers’ index - March
The ‘final’ CBA/IHS Markit Services Purchasing Managers' Index fell from 49.0 points in February to a record low 38.5 points in March. Any reading below 50 indicates a contraction in activity.
According to the CBA and IHS Markit, “The global outbreak of the coronavirus disease 2019 (COVID-19) weighed heavily on the Australian service sector in March, with the latest PMI data showing a slump in business activity. This was concurrent with a deepening downturn in new sales, led by a record fall in new overseas business. With backlogs of work falling markedly, firms reduced jobs further. Business confidence also fell to a survey-record low, while price pressures moderated.”
Performance of Construction - March
The Performance of Construction index (PCI) fell by 4.8 points to 37.9 points in March – the lowest level since May 2013. A reading below 50 points indicates construction activity is contracting.
Construction activity (down 6.0 points to 39.1 points) and, new orders (down 10.3 points to 35.4 points) fell by the most. Construction employment fell by just 0.5 points to 36.4 points, depressed at the second lowest level in 7 years.
By sector, house building lifted by 0.3 points to 53.2 points in trend terms, but apartment (down 1.5 points to 31.9 points), commercial construction (down 1.6 points to 35.1 points) and engineering activity (up 2 points to 42.2 points) all contracted in March.
According to the AiGroup, “The Australian PCI® suggests that house building activity has remained resilient in 2020 to date, although contacting new orders and the sector’s vulnerability to the deteriorating COVID-19 situation will weigh more heavily on conditions in coming months. In other sectors, activity is experiencing on-going declines amid a weak flow of work opportunities and new invitations to tender.”
And, “Respondents in the Australian PCI® reported further price rises for imported materials and subsequent pressure on margins due to the weak Australian dollar. Businesses are bracing for worsening construction conditions as virus-related impacts on economic activity and demand increase.”
What are the implications for interest rates and investors?
The next preliminary retail trade data from the Bureau of Statistics is not due until the week of April 20. The nation’s statisticians are having some difficulty obtaining spending data – with trend series data unavailable in February – due to COVID-19 associated disruptions.
But more timely data on consumer spending patterns is available from both the Commonwealth Bank (CBA) and Kepler Analytics. According to Kepler Analytics data, shopping centre foot traffic fell by 56 per cent in the week ended March 29 from a year ago. And around 55 per cent of stores had closed nationally by March 31. Retailers have also acted to cut fixed costs, such as wages and rent. And some retailers are remaining open by focusing on online sales. Of course, the announced JobKeeper government wage subsidy is also designed to cover store wages – where possible – and keep retail employees attached to their jobs ahead of an eventual recovery.
And recent weekly CBA credit &amp; debit card spending shows strong increases in consumer spending on food and alcohol, as well as on household furnishings and equipment. But spending on clothing, transport, recreation and personal care – all deemed “non-essential” due to self-isolation measures – continue to decline.
The slowing in demand for new residential homes is evidenced by the sharp slowdown in new orders for both apartments and houses. Commercial construction new orders declined for a 20th successive month. And engineering new orders also weakened “due to a lack of new contracts to replace completed infrastructure projects”, according to the AiGroup.
CRAIG JAMES is the Chief Economist at CommSec
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Biggest fall in clothing sales in 8 plus years: CommSec's Craig James

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The sale of 33 convenience retail outlets owned by 7-Eleven was considered very successful with a 100% clearance rate.
They sold for a combined $156 million.
Commercial agency Burgess Rawson successfully auctioned a final group of 18 properties at a 100% clearance rate earrlier this week. They previously sold an additional 15 of the company’s outlets at an auction in October 2019.
All properties sold on Tuesday traded on a blended yield of 4.83%, with one asset at Wahroonga in Sydney achieving a noteworthy yield of just 2.5% after selling for $4.67 million.
A further eight outlets sold on yields in the 4% range, including one in Penrith South, which was declared on the market on its first bid and reached $4.56 million, while another property at Pascoe Vale in Melbourne’s north sold for $4.775 million on a 4.09% yield.
Burgess Rawson director Billy Holderhead, who marketed the portfolio with colleagues Jamie Perlinger and Simon Staddon, and with Charter Keck Cramer’s Andrew Grant, Jessica Crossland and Tom Byrnes as transaction advisors, said the auctions had been runaway successes.
“Without a doubt this is one of the most successful – if not the most successful – commercial portfolios ever transacted in Australia,” Mr Holderhead said.
Mr Perlinger added – “Today’s auction alone was attended by 144 bidders and generated an estimated buyer pool of more than $550 million, which is a very clear indication that there is still a significant amount of unsatisfied demand in the fuel and convenience retail market.”
The properties featured new 12-year leases, indicating the belief in 7-Eleven as a brand and business model.
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33 7-Eleven outlets auctioned with 100% clearance rate

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Melbourne CBD’s premier retail thoroughfare Swanston Street will offer the first test of the market for 2020, with a family offering for sale a building it has held for 70 years.
CBRE’s Melbourne City Sales team have been appointed to market 273 Swanston Street, which is set to go to auction on March 12.
It is next to the McDonald’s on the corner of Lonsdale Street and Swanston Street. 
In the Melbourne CBD’s booming northern precinct between Melbourne Central, Emporium Melbourne and QV Melbourne, the property is being offered to the market fully leased to an established hospitality operator.
“Swanston Street has long been regarded as Melbourne CBD’s most highly desirable and tightly held street of property ownership and this is truly a once in a lifetime opportunity,” Alex Brierley said.
Over the past five years Swanston Street has been transformed from a retail strip to food and beverage destination catering to Melbourne CBD’s booming student population. 
Recent food and beverage leasing deals along Swanston Street have achieved rentals as high as $6,000 per square metre for smaller shops.
In a landmark deal, the former Jack London retail store at 301 Swanston Street was leased to popular chain David’s Hot Pot for approximately $400,000, for the 107 square metre ground floor space, negotiated by CBRE’s Zelman Ainsworth and Tan Thach.
“273 Swanston Street is well positioned to benefit from GPT’s new 10-level office tower that will sit atop Melbourne Central mall at 300 Lonsdale Street, which will drive rental growth well into the future,” Julian White added.
The last building to transact on Swanston Street was the 1930s-style, heritage 123 Swanston Street, which sold for just under $16 million, reflecting a 2.75 per cent yield, in 2015.
 
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70-year wait for Swanston Street building in Melbourne: CBRE

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NAB data mapping suggests that the ABS retail trade measure will fall 0.1% m/m in December following a gain of 0.9% in November.
The ABS printed a 0.9% gain in November, while NAB forecast 0.6% (revised to 0.5%). The strong November print is likely a result of the relatively new Black Friday sales bringing forward Christmas spending into November. 
Beyond technical questions around seasonal factors, this points to ongoing weakness in the retail sector amid high consumer debt levels and sluggish wage growth.
It is unlikely that the sector will see a sustained lift any time soon. On the contrary, the catastrophic bushfire season may further damage consumer confidence in January and February.
Click <a href="https://www.propertyobserver.com.au/images/2020/1/22/NAB%20Retail%20Index%20DEC.JPG" target="_blank">here</a> to enlarge:
<img src="https://www.urban.com.au/images/2020/1/22/NAB%20Retail%20Index%20DEC.JPG" alt="">
NAB Group Chief Economist Alan Oster said, "the retail sector has numerous fundamental issues; unemployment is set to edge higher, sluggish wage growth and elevated consumer debt continue to dampen consumer sentiment, despite interest rate cuts and higher house and share prices."
"In parallel to our standard mapping equations, we are running an experimental methodology. This alternative methodology forecast a bigger rise in November and an even weaker result in December."
"If anything, our December forecast has downside risk."
"The current bushfire season – underway since September – is a national tragedy. The local economic impact in bushfire-affected areas has been extreme."
"While it is unlikely that the fires were a major influence on the national December retail data, there may be much more substantial second round impacts in January and February," he concluded.
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Weakness in the retail sector exacerbated by bushfires: NAB

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A retail site on Burke Road in Camberwell has sold for $4,415,000.
The 205 sqm building at 769-771 Burke Road was purchased by a South Australian investor following a competitive auction that attracted six bidders.
The shop is located between the intersection of Burke, Riverside and Camberwell Roads and Camberwell train station, and adjacent to the Camberwell Place Shopping Centre.
It is currently leased to apparel retailer Lululemon Athletica.
CBRE’s Mark Wizel, Rorey James, Nick Hage and JJ Heng managed the campaign, with the property attracting a mix of domestic and international interest.
The purchase price translates to a building rate of $21,536 sqm, and follows the sales of 755 Burke Road for $5.05 million and 509-513 Riverside Road for $4.65 million.
Mr Wizel said, "we are expecting similar levels of demand and confidence in CBRE’s remaining retail opportunities in the build-up to Christmas."
“The current low interest rates and reduced supply of quality retail opportunities through the first half of 2019 has resulted in a flight to quality from investors seeking an alternative to declining term deposit rates,” he concluded
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Burke Road, Camberwell shop sold for $4.4 million

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It has been a tough year for the retail sector so far in 2019 and the upcoming festive spending will likely do little to change that underwhelming result, according to the latest quarterly retail forecast from Deloitte Access Economics.
It reported that weak wage growth, high debt levels and increasing price pressures are hurting demand, while tax returns and interest rate cuts have yet to fully come through.
However there is some positive news, with 2020 holding more promise.
According to Deloitte Access Economics’ latest quarterly Retail Forecasts subscriber report (Q4 2019):
<ol>
<li>Retail sales in September posted the weakest result since the 1990s recession, falling 0.2% over the year</li>
<li>Retail price pressures remain strong, eating away at volumes growth as households struggle with weak wage growth and high debt levels</li>
<li>Tax offsets and lower interest rates provided limited support to consumer spend to date</li>
<li>The outlook for 2020 is more positive with retail spending expected to grow 2.6% over the year.</li>
</ol>
"Retail sales look to be ending 2019 on a relatively soft note as consumers face increasing budget pressures, said Deloitte Access Economics partner and Retail Forecasts principal author David Rumbens.
"Stagnating wage growth and weak house prices have limited consumer willingness to spend, while tax offsets and interest rate cuts have yet to translate to sales. And with retail prices increasing, spending volumes have taken the hit posting the weakest growth since the 1990s recession.
"The start of the Christmas season looks to hold little cheer for retailers after a tough 2019 to date, and according to Deloitte’s recent Retailers’ Christmas Survey, only 21% (down from 41% last year) of respondents expect a growth above 5% this year."
Retail prices are surging on supply factors
Rumbens said retail price growth has been accelerating over the past year, with prices growing 2.6% in the year to September quarter.
"This is the first time since 2009 that retail prices have consistently outpaced general price pressures in the economy," he said
"Unfortunately for retailers, price growth is not reflective of stronger demand, but rather increasing cost pressures from a weaker Australian dollar, the increase to the minimum wage, and supply disruptions from droughts and floods.
"With retailers being squeezed on both sides from weak sales volumes and increasing costs, margins are coming under pressure."
Looking to 2020 for a turnaround
"We expect to see a much-needed improvement in the drivers of spending, providing the environment for a turn around the weak retail demand profile in 2020," Rumbens said. 
"Stronger wage growth, a reinvigorated housing market and moderating prices pressures are expected to support a much stronger growth outlook in the year ahead."
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