The portfolio comprises eight high-performing retail assets across Sydney, Melbourne, Brisbane and the Gold Coast

Australia’s CBD retail vacancy rate increased slightly in the first half of the year, while remaining low by historical standards.

According to CBRE’s Australian CBD Retail Vacancy H1 report, the national vacancy rate increased 40 basis points to 10.8 per cent. The increase was largely attributable to Melbourne, where two retail centres opened, adding new supply to the market.

The survey covered 5669 retail outlets across the CBDs of five capital cities. Melbourne’s vacancy rate increased 160 basis points to 8.1 per cent following the addition of new supply, while vacancy rates fell in the other four cities. The national increase was therefore mainly linked to new supply rather than a broad decline in leasing demand.

Sydney recorded the lowest vacancy rate at 5.3 per cent, followed by Melbourne at 8.1 per cent. Adelaide recorded the largest decline, with vacancy falling 130 basis points to 10.4 per cent. Brisbane’s rate fell 80 basis points to 16.7 per cent, while Perth’s declined 10 basis points to 18.5 per cent.

According to CBRE senior research analyst Katya Ezhova, return-to-office trends, tourism, major events and infrastructure investment are supporting CBD retail demand. These factors are also driving foot traffic and spending in city centres.

Consumer spending has also remained more resilient than expected despite pressure on household finances, supporting retail activity across Australia. New CBD retail supply remains limited, with CBD retail accounting for 4.2 per cent of total retail supply over the past decade.

Meanwhile, CBRE director of retail tenant representation, Pacific, Sam Embling, said continued expansion by luxury and premium retailers is supporting leasing demand, particularly in Melbourne and Sydney.

“At the same time, we’re seeing the establishment of more experience-led retail formats, including food and beverage, entertainment and wellness offerings, which contribute to placemaking initiatives and reinforce the appeal of CBD retail destinations,” she said.

• Further reading: Melbourne CBD retail vacancies hit long-term low.