Large Format Retail Outlook 2026

Australian Large Format Retail has flourished with investment returns of 12.8% pa over the past 10 years and vacancy falling to just 2.8%. Going forward, investors are likely to be attracted to:

• Booming spend: CBRE forecast household goods sales will grow to $94bn by end of the decade, +70% through the 2020s.
• Healthy ecosystem: For leading LFR tenants, Sales and EBIT are nearly 50% higher since 2019 while margins are broadly stable at 15%.
• Low supply: New supply fell to a 10 year low in 2025. While we forecast an improvement in 2026, much of the forward pipeline remains stuck in approvals.
• Rent growth: Rents are up 21% nationally since 2020 and CBRE forecast ~5% pa to 2030.
• Investment returns: CBRE forecast investment returns  could be ~11% pa to 2030, lead by rent growth. There is still scope for modest cap rate compression of ~10bps over the next 3 years.