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The Oversupply of Retail Space is Becoming More Evident to Pretoria East and It Is Not All Good News

"Shopping Centre demand in Pretoria East is seen to almost tipping over, but more malls are still coming online and it is starting to raise the likelihood of an over-supply of retail stock in the region".

While the region already has 50 formal shopping centres, 11 more proposed centres have been planned in close proximity to the area despite consumers’ seemingly waning appetite for retail therapy.

 

Generally, South Africa has a mall culture where most people living in suburbs shop, dine and go out for the night. But the big question is whether Pretoria East can support any more centres.

The latest findings released on Wednesday by Broll Property group confirms the proposed centres, measure a combined 555,459m² of space, of which approximately 21% is situated in Pretoria East.

“The numbers suggest Pretoria East, much like the retail sector in South Africa, is perceived to be oversupplied, however, since the area is still developing, the impact of the proposed new centres (if and when they come to fruition) on existing centres remains to be seen,” says Elaine Wilson, Divisional Director for Research at Broll.

The roll-out of new malls and an acceleration in consumer spending is defying the slowest expansion in gross domestic product since the 2009 recession, the highest interest rates in six years and an unemployment rate of about 20%. It cannot last, and rising inflation and the deteriorating economy will eventually take its toll, according to Zandile Makhoba, an analyst at Jones Lang LaSalle.

Source SA Commercial Prop News

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