09/09/2010 - 00:00

New policy to transform retail landscape

09/09/2010 - 00:00

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SHOPPING centre owners have welcomed the release of the state government’s Activity Centres policy by revealing expansion plans, but the head of the Retail Traders Association in Western Australia has warned it will be some time before WA shopping centres

New policy to transform retail landscape

SHOPPING centre owners have welcomed the release of the state government’s Activity Centres policy by revealing expansion plans, but the head of the Retail Traders Association in Western Australia has warned it will be some time before WA shopping centres catch up to their eastern states counterparts.

Planning Minister John Day officially launched the new policy last week, at the same time he launched the state’s new planning framework, Directions 2031 and Beyond.

Previously, the development of retail centres was based on a hierarchy of shopping centres with floor space guidelines, or caps.

Under the new policy the caps will not apply, and mixed-use developments including commercial, office, recreational and residential components will be encouraged alongside retail facilities.

Retail Traders Association executive director Wayne Spencer said the new policy would result in increased retail development investment and less pressure on shopping centre rents.

But Mr Spencer acknowledged that constraints on shopping centre expansion in WA over the past few decades had resulted in a situation where the new policy cannot be looked at as a quick fix.

“When you don’t have investment happening as it should happen in a free market then you find that infrastructure or government services lag behind because there is no pressure on them, so in other words they’re out of date as well,” Mr Spencer said.

“So you have a whole scenario that has to be re-thought, re-looked at and investment in not just a shopping centre, it’s all the services that go along with it that have to come along, so it’s a huge problem that is now going to really show its head.”

Mr Spencer said as a result of the hierarchy policy, retail investment in WA had lagged significantly behind the other states.

“We’ve been given figures that show that Western Australia over the past decade in pure retail development is about $55 million, compared to Victoria at $1.7 billion and New South Wales at $3.5 billion,” he said.

“We’re so far behind the eight ball; this red tape has cost an absolute fortune from investment in retail.

“This is a glaring example of how red tape can restrict an industry, partly because there are very few people out there that really understand the retail industry.”

The policy announcement comes at the same time that one of WA’s major shopping centre owners, AMP Capital Shopping Centres, is preparing plans for the $650 million expansion of its facilities.

AMP Capital managing director Bryan Hynes said the new policy gave centre owners the ability to provide new retail concepts and grow the retail landscape across Perth, driven by demand from major national retailers.

“A great example is, you take David Jones in both Karrinyup and Booragoon, they’re in undersized department store boxes,” Mr Hynes said.

“(The policy) gives us the ability then to build the latest format David Jones store, the latest format Coles supermarket or Woolworths supermarket and the associated specialty retail stores with that.”

Mr Hynes said there has been a development application lodged with the City of Wanneroo since December last year for a $130 million expansion of Ocean Keys shopping centre.

AMP Capital plans to construct a discount department store and 65 specialty retailers at an expanded Ocean Keys.

Mr Hynes said AMP was now well placed to examine expansion possibilities at its Karrinyup and Garden City centres now the Activity Centres policy has been released.

“Some of the catchment areas around Perth are very attractive,” he said.

“Karrinyup’s catchment for instance has got a very upmarket demographic, Booragoon’s demographic is also very attractive.

“Both of those centres are positioned very well, they trade exceptionally well, they are in the top quartile of traders right across our Australian portfolio so they are very, very strong centres and I think expanding those centres to cater to the market has got to be a priority for us.”

 

 

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