Sydney retail rents are in the top three of the world while Melbourne and Brisbane lie in 8th and 9th places respectively.
Australia’s high profile economic performance is seen as the culprit with international brand retailers breaking their backs to get into the world’s No.1 growth economy and paying higher rents as a result. Local brands, on the other hand, are experiencing softer conditions.
According to a report on smartcompany.com.au “Retailers have been calling for landlords to lower their rents for some time, with even prominent chains such as Baker's Delight complaining that prices are too high.”
At this week’s annual general meeting, Mark McInnes of Premier Investments gave details of his much publicised rent comments - The former David Jones chief described how he's able to play hard ball and focus on internet sales in order to gain some much-needed discounts. "Portmans in Canberra Centre is the most obvious example," he said. "We're doing $800,000 in that store – it's a terrific store for us – but we're paying $400,000 in rent and we're basically breaking even." "We said to the landlord, "Well, we're going to shut. We'll put an ad in the Canberra Times saying 'Go to Portmans.com.au and if you don't want to go online, Go to Belconnen'- And our rent reduced 30%."