Singapore retail rents to rise by up to 2% this year

Specifically for Orchard Road and Suburban mall rents.

Following a stronger-than-expected growth for the first three quarters, Savills noted in a report that global economic headwinds could slow Singapore’s economic growth for the rest of the year and 2026.

“This should affect the domestic-oriented sectors such as retail and F&B, which have been experiencing volatile performance in the last few quarters as consumers become more prudent with their spending,” the report said.

Here’s more from Savills:

Although sales takings in October are likely to be lifted by events such as the Formula 1 Singapore Grand Prix, overall spending could be hindered by tepid job market and moderated wage growth. The current market conditions could weigh on consumer confidence, which in turn affects spending behavior, especially for discretionary goods.

Although the tapering retail space supply pipeline is likely to lend some support to the occupancy and rents in the next two years, high operating costs and inconsistent spending patterns are likely to continue putting pressure on retailers, resulting in higher tenant turnover.

While suburban malls are backed up by steady footfall and essential purchases, the rental growth is limited as many smaller operators are still grappling with cost pressures and competition from cross-border shopping.

Alongside the growing tourism numbers and affluent consumer base, Singapore is likely to remain as one of Asia’s top luxury shopping destinations, attracting more international retail brands to expand their footprint here.

Nonetheless, the effect of existing struggling businesses and new entrants could potentially be negated by each other, hence limiting the occupancy and rental growth to only the prime shopping belt.

For 2025, we expect both Orchard Road and Suburban mall rents to rise by up to 2%.