Melbourne Retail Figures Q2 2024

Key Points: 

• Victorian retail turnover continues to decline as consumers adjust to rising cost of living pressures, with a recorded -0.54% change over the previous three months to $9,142m.
• Labour market conditions continue to ease, with Victoria’s unemployment rising to 4.3%. This aids retail tenants' ability to expand whilst limiting inflationary pressures on local wages.
• Retail supply over 2024-2025 is expected to reach c.210,000sqm across CBD, Shopping Centre and LFR assets. Supply over this time is expected to remain in line with the five-year historical average of c.160,000sqm.
• Melbourne CBD vacancy in H2 2023 was recorded at 6.9%, a 50bp decrease from H2 2024.
• Net face rents across Melbourne’s shopping centre and LFR assets have stabilised in Q2 2024, with downward pressures on super prime CBD assets returning over the quarter.
• Retail investment sales continue to be subdued across Melbourne in Q2 2024, with a recorded c.$70m transacting.
• Yields showed little movement over the quarter, attributed to limited deal evidence.