VIC MARKET OVERVIEW
VICTORIA
VIC Market Overview with Chris James
What types of retail properties are in most demand? Historically, the demand has centred on high-profile Melbourne strips within close proximity to the Melbourne CBD, however, investors are beginning to see value in high-quality and high-performing strips, regardless of its proximity or demographics. Examples include Koornang Road in Carnegie, and St Albans, and Diamond Creek and other “outer” or semi-regional areas. Strips that are more concentrated and serve a broad catchment are the standouts, such as North Balwyn Village-Doncaster Road. What do you see as the biggest challenges that face buyers and sellers in today’s market? A big challenge for buyers is being able to forecast their acquisition in three or so years’ time and through a rising interest rate market. The common questions that arise include “Where will the rent sit?”, “How will the tenant perform through an inflationary market?, and “What will happen with vacancy rates?”. On the flipside, sellers are currently facing some downward pressure as a result of fluctuation in buyer sentiment. Let’s not forget the market has come off a very high
base and is still very strong in most areas. The fortunate outcome is stock levels have begun to tighten, and I believe this will coincide with further recovery in the very near future. Who have been key retail buyers over the last 12 months and have you seen a shift from previous years? Pre-COVID and for many years prior, the buyers for strip retail assets were the repeat buyers – known privates, families and ones more easily identified. Moving forward to today’s market, the buyer profile is exceptionally dynamic, also largely consisting of occupiers, family acquisitions, first-time commercial buyers and retirees. As a result of this, as agents our marketing needs to adapt to reach every possible buyer, not just a database. What are some of the most significant or rewarding projects/sales that you’ve been involved in and why? Fitzroys has been fortunate to have been appointed on a number of high-profile family portfolios and properties in recent months. Being able to take the time to value-add and position to the market has been very rewarding. Some of these properties have had months and even years in the “back-end”
CHRIS JAMES Fitzroys Division Director - Agency
36 – July / August 2022
Powered by FlippingBook