18/10/2005 - 22:00

Prime space a luxury item

18/10/2005 - 22:00

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Just as luxury goods retailers are coy about who their clients are, retail leasing agents are equally coy about which brand name stores are considering a move to Perth.

Prime space a luxury item

JUST as luxury goods retailers are coy about who their clients are, retail leasing agents are equally coy about which brand name stores are considering a move to Perth.

There does seem to be agreement, though, that high-end retailers have limited choices in terms of location, with the King Street precinct and the Pivot Group’s 100 St Georges Terrace development (yet to commence) among the options.

Lease Equity director Jim Tsagalis, who is working on securing retailers for the Pivot development, said more high-end retailers would come to Perth in the near future.

“There are a number of international brands looking at Perth – some are close to committing, and others we have had discussions with over a reasonable period of time,” Mr Tsagalis said.

“From a local perspective, there is an enormous amount of wealth in Perth, but the critical mass is a little bit prohibitive.

“From the retailers’ point of view, there is a vertical nature to what a lot of these guys are doing, and they are just getting their distribution sorted out. They want stand-alone stores with good turnover and market penetration.

“The strength of WA’s economy does encourage the brand retailers to come to Perth, and if anyone is looking at expansion in Australia, Perth is a logical place.”

Mr Tsagalis said King Street was a natural location for luxury retailers, but that Century City was the product with the most potential due to its location, size and presentation.

CB Richard Ellis associate director of retail services, Fred Clohessy, said he knew there were some interested luxury retailers looking at Perth, mainly around the King Street precinct and new developments.

“There are a number of reasons these types of retailers are wanting to move into WA,” he said. “The growth of Perth and future potential of Perth is very strong, and a lot of these groups are looking to increase their market share.

“Perth is presumed safe and clean; it is proximate to Asia, and the potential growth is huge.”

Mr Clohessy said retail rents were increasing, with the most expensive retail in Perth on either the Hay Street or Murray Street malls, where, for example, a 60 to 80 square metre space could be rented for $3,000/sq m.

“Somewhere like King Street doesn’t have the pedestrian traffic, but has the beautiful buildings and the reputation for upmarket retail,” he said.

Several factors pointed to the future success of CBD retail according to Mr Clohessy: the sinking of the rail line and the creation of two new CBD train stations; the convention centre; and the relative exclusivity of Sunday trading for the CBD.

On the potential of several new retail developments to attract high end retailers, Mr Clohessy said new retail developments’ potential to attract high-end retailers depended very much on what owners wanted to achieve in their developments.

“I can see Century City attracting those upper-end retailers though, and they have made clear that is what they are looking for,” he told WA Business News.

• See Property, page 27 for the results of CB Richard Ellis’ prime retail shopping strip survey, which details Perth’s most expensive non-retail shopping strips.

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