Furniture retailers are ramping up their Victorian presence and emerging as one of the most active retailer categories in the large format sector, with strong trade growth underpinning a flurry of recent leasing activity.
Leading furniture retailers including Plush and Fantastic Furniture recorded strong sales growth throughout the first half of the 2016 financial year, with 18.8% and 19.2% increases respectively. Nick Scali and Harvey Norman have also benefited from strong sales growth, with increases recorded of 30% and 7.6% for the full 2016 financial year.
CBRE’s Head of Large Format Retail, Chris Parry said furniture retailers are currently capitalising on this strong growth, with a number of groups targeting expansion opportunities in the Victorian market.
“The aggressive growth from furniture retailers is a result of strong trade witnessed throughout the household goods market, with a 4.8% increase recorded in the year to May 2016.”
Demonstrating the trend, leading Melbourne brand Koala & Tree has recently leased the final 986sqm vacancy at GPT’s Maribyrnong Homemaker Centre – representing the retailer’s sixth Victorian outlet. Chris Parry and Tom Perkins of CBRE negotiated the agreement, with rents in the Maribyrnong showroom precinct, along Rosamond Road ranging from $250 - $330sqm net.
“Koala & Tree have identified the current positive market conditions as the ideal time to expand, with the Maribyrnong showroom representing a strategic opportunity in Melbourne’s north-west,” Mr Perkins said.
“The expansion of Koala & Tree reflects the recent strong performance and growth of furniture retailers across Victoria, which has continued since 2015 when furniture groups emerged as the most active retailer category.”
The Maribyrnong Homemaker Centre, located at 179 Rosamond Road, continues to perform strongly as a result of its strong retail mix - with major brands including Spotlight, Plush, Forty Winks, Snooze, Petbarn and Carpet Call established in the centre.
“The site’s strategic location opposite Highpoint Shopping Centre has contributed to the centre’s zero vacancy rate, with a number of retailers vying to secure the final site,” Mr Perkins added.
The Maribyrnong Homemaker Centre showroom represented the last of Far Pavilion’s Victorian sites to be re-leased, following the retailer going into voluntary administration in July. The other four tenancies were located in Bendigo, Nunawading, Frankston & Springvale.
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About CBRE Group, Inc.
CBRE Group, Inc. (NYSE:CBG), a Fortune 500 and S&P 500 company headquartered in Los Angeles, is the world’s largest commercial real estate services and investment firm (based on 2015 revenue). The Company has more than 70,000 employees (excluding affiliates), and serves real estate investors and occupiers through more than 400 offices (excluding affiliates) worldwide. CBRE offers a broad range of integrated services, including facilities, transaction and project management; property management; investment management; appraisal and valuation; property leasing; strategic consulting; property sales; mortgage services and development services. Please visit our website at www.cbre.com.