Retail vacancies in some of Western Australia’s biggest shopping centres are now lower than they were before the pandemic, as the state’s booming economy and its relative escape from the worst of the virus drive a recovery for brick and mortar traders.
An analysis of occupancy levels across all Westfield shopping centres across Australia found all vacancies that had opened in WA centres since April last year, as well as some pre-Covid vacancies, had since been re-leased.
The vacancy infill rate for WA (103.6 per cent) and to a lesser extent Queensland (81.94 per cent) sit in sharp contrast to most other states, with the likes of NSW, Victoria and South Australia all having a rate of less than 60 per cent.
NSW could well fall further in the coming months as the impact of Sydney’s latest outbreak continues to bite.
While both WA and Queensland have been criticised for their tight border restrictions during the pandemic, both states – and WA in particular – have needed little to no capacity restraints or other impediments for most of the crisis and have not endured any large-scale outbreaks, like the one gripping Sydney.
WA has also benefited from the biggest mining boom in the state’s history, which has delivered a multibillion-dollar windfall for the state and sparked fresh labour shortages.
The vacancy infill rate was compiled by consultancy Clint Ford and Associates, which is advising on a proposed $100m redevelopment of a shopping centre in the Perth suburb of Kardinya.
Clint Ford said the figures reflected both WA’s broader economy and its success in weathering the worst of the pandemic.
“We’ve had some short, sharp lockdowns and some other minor restrictions here and there, but by and large we’ve lived in a much more unrestrained way and with greater certainty. That’s reflected in this,” he said.
“It demonstrates really clearly that WA has moved out of Covid, very clearly it has led the nation, it’s economy is very strong and consumers are responding.”
While WA businesses took a hit during Perth’s four-day lockdown earlier this month, Premier Mark McGowan last month announced a $3000 grant for small businesses that lost revenue as a result. The government is expected to announce a multibillion-dollar surplus when it hands down its budget in coming months.
Chamber of Commerce and Industry of WA chief economist Aaron Morey said the positive vacancy rate was another sign of the health of the state’s economy.
“We’ve had more money washing through the pockets of households, but the critical thing is they’ve been able to spend it,” he said. “That combination has really propped up a lot of those retailers.”
A spokeswoman for Westfield, which is owned by Scentre Group, said the group’s portfolio-wide occupancy rate across Australia was at 98.5 per cent at the end of March. That figure sat at 99.3 per cent at the end of 2019.
The apparent improvement in WA’s shopping centre vacancies also potentially bodes well for brick-and-mortar retail beyond the pandemic. While the early stages of the pandemic hastened the move of consumers to online purchases, the WA data suggested people still enjoyed the physical experience and interaction of shopping in public. “Covid has demonstrated that we are social beings and we still like to be out and about doing things and socialising,” Mr Ford said.