Blank glass facades and ‘for lease’ signs pepper Brisbane’s streets as smaller retailers struggle to keep afloat in a tightening economy, prompting the sector to urge people to put down the phone and walk into the shops.
Shopping centres post discreet notices about inquiries for leasing tacked low to empty windows, as retail chains with proud names join a string of high-profile closures.
Commuters waiting at bus stops turn their backs to signs promising newly refurbished spaces and landlords keen to treaty. Restaurants and bars that trumpeted their arrival just months ago now sit shuttered, and shoppers opt to stay at home rather than trawl the streets.
Further afield, in suburbs such as Hamilton and Ascot, small businesses feeling the pinch have blamed roadworks and greedy landlords for rows of vacant windows – but that may not be the whole picture.
Landlords paying off a mortgage may need to keep advertised rents high to ensure they can cover their debts and prove to the banks that the property is worthwhile, opting to keep a place vacant in the hope of a well-paying tenant.
In the outer suburbs, some village shopping strips that were known to be the centre of community life are running on a few determined businesses, as the economic downturn hits retailers hard and small businesses in particular feel the pinch.
Speaking in Brisbane on Thursday, the National Retail Association’s Dominique Lamb said many shopping areas depended on foot traffic at a time when consumers were staying away.
“We really need to get them into our local communities, shopping in our stores and taking part in some of the artisans we have around Brisbane,” she said.
She said the association did not have exact figures on vacancies across south-east Queensland, but there had been many closures early in the year – not unsurprising, but still notable.
“This was a good Christmas, we did see an increase across the country and certainly across the state, but for some it simply hasn’t been enough,” Ms Lamb said.
While small businesses report some challenges, Colliers International’s December quarter retail report predicted headier days ahead for Brisbane with major transport and development projects such as Queen’s Wharf strengthening confidence in the retail sector.
“Colliers International has witnessed a number of off-market repositioning deals with major retailers strategically taking up space on Queen Street Mall,” the report said.
While the hub of Brisbane shopping, Queen Street Mall, remains busy with about 70,000 visitors a day, just a few strides out of the centre the first signs of struggle appear.
Brisbane City Council has responded to the challenges for smaller businesses by trialling several initiatives, launching a grants program to enable landlords and business owners to temporarily rent out vacant spaces as pop-up or short-term stores.
Its village precinct projects have also focused on revitalising suburban shopping strips with more pedestrian-friendly footpaths and parking, and more attractive strips.
Lord mayor Adrian Schrinner said it was critical residents turned back to their communities for shopping rather than going online.
“We know that our big export industries like tourism and international students are facing challenges with coronavirus and we know there’s a potential for that to flow on to other sectors of the economy,” he said.
“We can do something about it – buying local, supporting local business.”
But, he admitted some shopping strips such as Paddington in Brisbane’s inner north-east faced a perennial problem of a lack of parking.
“Right across Brisbane, we hear the feedback that parking is of concern,” Cr Schrinner said.
He said the council worked hard to get the right parking restrictions to meet the needs of all residents, and was always happy to work on local business areas to improve parking problems.
Earlier in the year, data collated by Brisbane company Urban Economics on behalf of the Committee for Brisbane reported retail vacancy rates across the CBD, South Bank and Fortitude Valley.
By September 2019, the highest vacancy rates in the Valley were at the Emporium and James Street, collectively about a 10 per cent vacancy rate.
The South Bank precinct had an 8 per cent vacancy rate, and vacancy rates of less than 5 per cent in the CBD, according to Urban Economics’ report.
Urban Economics reported there had been a “measurable and clear take-up of vacancies in ground floor office buildings and in arcades or older strip stock” across Brisbane’s city centre.
Ms Lamb said Brisbane’s vacancy rate for retail property was on a par with other capital cities nationally, but immediate issues such as bushfires and coronavirus had seen some smaller businesses in particular report a drop in turnover.
“We really need to encourage people to get out and about – if we don’t do that, it’s going to get harder for those retailers, and ultimately that will impact jobs,” she said.
Keep up with Commercial Real Estate news.
Keep up with Commercial Real Estate news.