The 2014 March Quarter Retail Trade data is out, the federal budget is done, and most shopping centre asset plans are coming together. What do your plans look like? Do they have a solid foundation? We thought we’d offer our views.
The factors to consider when determining your MAT (Moving Annual Turnover) growth forecasts are:
Trade area population growth, which is unique to the catchments of your properties
‘Real’ growth in spending levels per head, driven by macro-economic issues including income growth and consumer confidence.
Retail price inflation, a subset of CPI
Changes in the competitive environment
Online take up
Offshore spending
Retailer performance
Centre management, particularly leasing and marketing initiatives.
despite some negative consequences from the recent budget, the post GFC recovery is underway;
some pricing power should come back to the retailer, although we note that harmonisation will continue to dampen retail price inflation;
discretionary spending, in particular, is set to grow more strongly than we have seen for 5 years; and
NSW is likely to be the standout state.
This article first appeared in the Urbis Think Tank. Urbis is an interdisciplinary consulting firm offering services in planning, design, property, social planning, economics and research. Working with clients on integrated or standalone assignments, Urbis provides the social research, analysis and advice upon which major social, commercial and environmental decisions are made. With over 300 staff Urbis is uniquely positioned to handle projects from the simplest to the most complex.
