Rents in Orchard Road dipped 1.3% to $36.75 per sq ft

Here are reasons behind the slip.

According to Colliers International, as of the end of March 2013, the monthly prime ground floor gross rents in Orchard Road fell by 1.3 percent from the previous quarter to S$36.75 per sq ft.

In the Regional Centres, the average monthly gross rent of prime space fell by 0.1 per cent from 4Q 2012 to S$33.88 per sq ft.

Given that the Regional Centres have established a firm presence among its residential catchment population, coupled with increased competition among Orchard Road malls, the rental premium that prime retail space in Orchard Road commands over similar space in the Regional Centres narrowed further from 11.5 per cent as of end-2012 to 10.1 per cent in 1Q 2013.

Here's more from Colliers International:

Mr Calvin Yeo, Deputy Managing Director, Client Services, says, “Despite the cautious consumer sentiments, the leasing market continued to enjoy a consistent momentum of new openings and entrants of both shop and food and beverage (F&B) outlets in 1Q 2013.

Overall vacancy rates remained low with many of the popular Orchard Road and sub-urban malls being able to replace outgoing tenants. It was observed that although trading conditions are challenging, various retailers are still keen to attempt new concepts, as well as to embark on expansion plans in locations where they do not have a presence.”

For instance, in 1Q 2013, the luxury watch house, Philip Stein, as well as the American furniture and household chain, Crate & Barrel, opened their first Singapore outlets in ION Orchard.

Over in the sub-urban malls, French label, Agnes b., opened its first outlet store at IMM. F&B outlets also made their debut at retail malls, such as the Hong Kong dim sum chain, Tim Ho Wan, which opened its first overseas outpost in the new atrium wing of Plaza Singapura.