Prime Orchard Road rents dipped 1.5% to $34.60 psf per month

Due to tighter foreign labour laws.

According to Savills, prime Orchard Road rents slipped by 1.5% QoQ from S$35.10 to S$34.60 per sq ft per month in Q3/2013. Savills Singapore believes that the decline was due to the new foreign labour restrictions which stalled expansion plans for most retailers.

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In addition to the slight decline in rental rates, the vacancy rate in the Orchard area also adjusted slightly up from 7.3% to 7.7% this quarter. The figures are, however, less likely to rise further as retail sales are expected to continue growing in line with the economy.

This optimism is borne out by the upcoming opening of European brand Roger Vivier’s first Southeast Asia store next quarter at Ngee Ann City, Repetto’s first flagship store at ION Orchard in November and Orchardgateway’s high precommitment of about 95%.

Prime suburban rents remained at S$31.10 per sq ft per month for the sixth consecutive quarter. Vacancy rates for the malls should remain healthy as more international brands expand into suburban areas such as Topshop in JEM and Emporio Armani Watches & Jewellery at Vivocity