Light Rail and 40% cheaper rents driving appeal.
George Street in Sydney’s CBD is currently undergoing a reinvigoration which will see the precinct become the new hotspot for retail in the CBD, according to Colliers International.
The new Light Rail, which is currently being constructed down George Street, extending from Circular Quay to Central Station and culminating at Randwick and Kingsford, combined with rent that is nearly 40% cheaper than destinations like Pitt Street Mall, are increasing George Street’s appeal to retailers.
“Retailers are looking to George Street as the next option and the Light Rail development will assist in transforming this area into the ‘main vein’ of the Sydney CBD, allowing greater access to this part of the city on a daily basis,” said Pieter Englebrecht, Retail Leasing Executive at Colliers International.
Cameron Wakeham, Manager of Retail Leasing at Colliers International says that the comparatively low prices of George Street, compared to some of the other retail hubs make it an appealing option for retailers.
“George Street presents a cheaper option with average rents nearly 40% cheaper than the Pitt Street Mall and other retail destinations within the city.”
“With the imminent arrival of e-commerce stores such as Amazon and Ali Baba, retailers need to remain competitive and cut costs in any way they can, and ensuring rental costs remain relatively low is an easy way to do this.”
According to Colliers International, current average rents in George Street start from $3,750 sqm - $6,750 sqm compared to $9,750 - $21,250 per sqm in Pitt Street Mall. Rents for King Street, between George and Castlereagh Street start from $5,500 - $12,750 sqm.
Mark McClennan, Director at GM Retail who was responsible for moving Nike, Superdry and General Pants to George Street, believes that “George Street is set to emerge as the main retail vein of Sydney CBD and is presenting a major threat to the Pitt Street Mall.”
As well as the stores brought over by Mark McClennan, recent additions to George Street include the Grounds of the City, Crumpler, and the OPSM flagship store.
“There are also a number of developments in the pipeline for George Street which have a retail component, including Circular Quay Tower by Lend Lease, 275 George Street by John Holland and Wynanrd Place, Brookfield, said Pieter Englebrecht.
Many retailers are beginning to rethink their Pitt Street Mall Precinct strategy with Forever 21 looking to exit their lease in Sydney Arcade and Lovisa and GStar exiting the mall from MidCity Shopping Centre.