The falling rental rates provide a silver lining for online retailers amid the current retail slump.These retailers have a chance to venture offline and into shopping malls. Last month, for example, online furniture retailer HipVan opened its permanent 11,000 sq ft flagship store at The Cathay in Dhoby Ghaut.
Lifestyle retailer Naiise similarly opened its 8,500 sq ft flagship store in that mall last June. Other online retailers, such as Reebonz, Love Bonito and Ohvola, have opened short-term stores in Suntec City and Orchard Gateway, to catch shoppers who want to see, touch or try on a product before buying.
The islandwide vacancy rate for retail space was 7.5 per cent at the end of last year, up from 4.5 per cent at the end of 2013, Urban Redevelopment Authority (URA) data showed.
The Median rental rate per sq ft per month for the Orchard Road area is $9.82, the first time it fell below $10. The median rental rate for retail space in the third quarter of last year was the lowest on record.
The median rental rate for retail space in the third quarter of last year was the lowest on record, falling to $9.82 per sq ft per month for the Orchard Road area – the first time it fell below $10, according to URA data.
Naiise has five other stores in malls such as Westgate and 112 Katong, which offer self-collection services for online orders. Its online plus offline strategy has paid off, with its six retail stores combined now generating more revenue than its online store.
HipVan co-founder Danny Tan, 33, said the retail slump has benefited his business, which now occupies the space formerly rented by sportswear brand Adidas. The store is seven times larger than HipVan’s previous pop-up space in Millenia Walk and Suntec City. It features more than 1,000 of HipVan’s bestsellers, including beds, dining tables and rugs. Its website attracts 200,000 to 300,000 views a month, while revenue has been growing by 12 per cent on average every month.
Meanwhile, high-end fashion retailer Reebonz, whose lease for its pop-up boutique in Suntec ends next year, is moving into its own eight-storey building in Tampines this month. The building will house a permanent showroom.
TripleOne Somerset is a prime integrated development comprising two premium-grade office towers and a retail podium next to Somerset MRT station. Perennial Real Estate Holdings (PREH) is leading a group of investors that are selling their combined 70 per cent stake in TripleOne Somerset to Hong Kong’s Shun Tak Holdings.
PREH and six other shareholders of Perennial Somerset Investors (PSI), their holding company for TripleOne Somerset, are offloading a combined 61 per cent stake in the property for $305 million. PREH, which originally held 50.2 per cent of PSI, is divesting a 20.2 per cent slice while retaining 30 per cent. It will collect about $101 million for the sale, making a pre-tax gain of about $34.3 million.
The other six shareholders, all of whom have fully divested their stakes in PSI, are SingHaiyi Group, Boustead Projects, BreadTalk Group, Shun Fung Holdings, ROOI Holdings and Grandma’s Holdings.
Unified Elite Limited, another existing shareholder of PSI and a connected person to Shun Tak, will sell its 9 per cent stake to Shun Tak. The sale price was based on an agreed total property price of about $1.258 billion, or $2,200 per sq ft. The divestments are expected to be completed by June 30.
Prime Waterfront Homes and Living in Singapore