Retail Rents 09 3q2025 Global Brands Fill Gaps Left Exits

According to data released by the Urban Redevelopment Authority (URA) on Oct 24, overall retail rents in Singapore increased by 0.9% q-o-q in 3Q2025, staying at the same pace of growth as the previous quarter. CBRE Research observed that prime floor rents across the island rose by 0.5% q-o-q, leading to a year-to-date growth of 1.8%.

While there have been reports of intense competition, high rents, and rising costs contributing to store closures, leasing activity remained strong during this quarter, according to Tricia Song, head of research for Singapore and Southeast Asia at CBRE.

The URA data showed that there was a positive net absorption of 5,000 sqm (54,000 sq ft) in the private retail market across the island, which has reversed the previous two quarters’ contraction. However, with a net increase of 13,000 sqm (140,000 sq ft) in new stock, the islandwide retail vacancy rate has gone up from 7.0% in 2Q2025 to 7.2% in 3Q2025.

Leonard Tay, head of research at Knight Frank Singapore, stated that amid mounting manpower, material, and occupancy costs, some local F&B operators have exited the market. However, their spaces have been quickly taken over by international chains, luxury brands and specialized service providers such as beauty, wellness and enrichment centres. He adds that the demand for retail space remains resilient, spurred by the appetite for in-person and curated experiences.

New-to-market brands, such as luxury candy retailer Sugarfina and Chinese beauty brand Joocyee at Wisma Atria, Middle Eastern dining brand WEWA at Orchard Central, and Australian self-serve yoghurt chain Yo-Chi, which chose Orchard Central for its first overseas outlet, have entered the Orchard area, according to Wong Xian Yang, head of research for Singapore and Southeast Asia at Cushman & Wakefield (C&W).

In the meantime, Orchard returned to positive net demand of 32,000 sq ft in 3Q2025, driven by strategic store openings amid the recovering tourism sector, notes Wong. Significant openings included The Planet Traveller’s largest Asian flagship at ION Orchard, Lululemon x Within’s first integrated yoga and Pilates concept store in Southeast Asia at Takashimaya Shopping Centre, and Carousell Luxury’s debut physical store at The Centrepoint.

Metro Holdings has also appointed Erwin Wuysang-Oei as CEO of Metro Limited to oversee its retail division, while luxury candy retailer Sugarfina and Chinese beauty brand Joocyee have joined Wisma Atria.

Orchard’s retail vacancy rate has edged down to 6.5% in 3Q2025 after two successive quarters of increases, reflecting sustained interest in prime locations and the limited availability of high-quality space, observes Wong. He adds that as of September 2025 year-to-date, international visitor arrivals have achieved about 90% of pre-Covid levels (September 2019 YTD), driven by a robust calendar of MICE activities and major entertainment events.

Fashion, beauty and lifestyle retailers have continued to expand their presence in the Downtown Core submarket. This includes San Francisco women’s fashion brand Bape, Issey Miyake’s menswear label IM Men, and Shiseido’s prestige beauty brand Cle de Peau Beaute. The Downtown Core has recorded the strongest performance, with positive net absorption of 9,000 sqm (97,000 sq ft), while the Outside Central Region (OCR) saw a reversal and a decrease of a similar amount after outperforming in 2Q2025.

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Meanwhile, Chinese brands are rapidly expanding into Singapore, and they are not just limited to F&B and fashion but are also venturing into beauty, health, and wellness. For example, Joocyee, head and scalp spa TTE Elephant at Marina Bay Link Mall, and eyewear brand Bolon, which has continued to expand since its first Wisma Atria store in 2017.

The strong performance in the market is underpinned by sustained retailer confidence, particularly from new-to-market brands attracted to Singapore’s large office workforce and the tourism rebound, says CBRE’s Tricia Song. She adds that as a result, vacancy rates in this submarket fell from 8.1% in 2Q2025 to 7.1% in 3Q2025.

Since the completion of Lentor Modern Mall in August, the OCR’s higher vacancy rate has climbed from 4.5% in 2Q2025 to 5.9% in 3Q2025, as tenants continue to move in, according to CBRE’s Song.

Demand for suburban retail space remains robust, with a net demand of 32,000 sq ft in the Outside Central Region (OCR). The recent completion of Lentor Modern Mall also contributed to the higher vacancy rate of the OCR which has increased from 4.5% in 2Q2025 to 5.9% in 3Q2025, as tenants move in to occupy the available spaces, according to CBRE’s Song.

High-traffic suburban areas have continued to attract activity-based retailers, led by F&B and athleisure operators such as Adidas, Skechers and Wilson, which opened four outlets following their debut in late 2024. Other new entrants such as Swiss sportswear brand On, with a two-storey Southeast Asia flagship at Jewel Changi Airport, KKV at Bedok Mall, Jem, and Tiong Bahru Plaza, and OH!SOME’s first outlet at Tampines 1.

In conclusion, with a limited supply of new space, C&W expects prime retail rents across the island to increase by 1-2% y-o-y in 2025. The annual completions for the next three years will average 0.3 million sq ft, which is less than half the 10-year historical average.

Retailers are still facing challenges such as manpower shortages, high costs and competition from e-commerce, but the projected recovery of tourism – thanks to a robust pipeline of MICE events and concerts – will continue to drive demand for prime retail spaces, albeit at a cautious pace given lingering uncertainty in the global market.

CBRE Research expects overall prime retail rents to grow by 2.3% in 2025, returning to pre-Covid levels.