The gap between retail rents in Orchard Road and suburban regional centres continued to narrow this year, as tenants opt to set up shop farther out from the city centre.
A report from property consultancy Colliers International on Thursday showed that rents of prime retail space in Orchard Road were 9 per cent higher than similar space in regional centres this year. This was a dip from 31 per cent in 2007.
Regional centres are usually in the suburbs, with a mix of offices, shops and entertainment places such as malls.
Mr Calvin Yeo, deputy managing director of Colliers International noted that the shrinking difference was a result of retailers spreading out from Orchard Road to various locations across the island.
Rents of prime retail space in Orchard Road fell 2.1 per cent to $36.46 per sq ft (psf) from $37.25 psf a year ago.
Colliers said the decline was still better-than-expected, compared to its projection of 3.5 per cent. This was supported by demand from international brands and local entreprenuers opening new stores in the prime shopping district.
In the regional centres, rents inched up 0.1 per cent to $33.46 psf from $33.42 psf a year earlier.