Development boom builds future for Parramatta CBD
The fundamentals of the Parramatta market are robust, with a growing office workforce and continued increase in the resident population making the city an attractive retail location, according to Ray White’s latest Between the Lines commercial research.
The CBD is in the midst of a development boom and the construction of new commercial and residential towers, together with transport improvements have disrupted the city.
Ray White Commercial’s Head of Research Vanessa Rader said the developments will continue for the next few years, with the major light rail project closing streets and unlikely to be completed until 2023, but it will be worth the wait.
Ms Rader noted, “the high occupancy and growing rents achieved across the Prime Parramatta retail strip are encouraging, with the continued demand highlighting the long-term longevity apparent in this location.”
She said the leasing market across the Parramatta CBD strip retail market has been mixed during 2018 and that while demand is high, the uncertainty surrounding the extent of disruption to trade has made negotiations more difficult.
Their research found that gross face rents recorded growth over the past 12 months of 3.54 per cent across the total market.
Ms Rader said Ray White Commercial had surveyed the Prime Church Street retail strip, with the location divided into two zones*.
“Across the total Parramatta Prime strip, vacancy is recorded at just 6.35 per cent. The larger Zone 1 is outperforming, with a vacancy of 5.55 per cent compared to Zone 2, at 10.89 per cent,” she said.
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Source: Ray White
“While cafés and restaurants are the main operators along the Church Street strip, the remaining mix is quite different.
“Zone 1 has a total of 43.62 per cent of all space devoted to food retailing, with services featured high at 19.67 per cent.
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“This zone also has a somewhat even split to other retailers being clothing and soft goods, personal and household goods and recreational goods representing approximately 8 per cent of the total floorspace each.
“Along Zone 2 we see a greater reliance on food retailing, accounting for 45.91 per cent with a larger grocery component. Services also dominate, representing 41.25 per cent of space given the existence of the council offices and other banks/professional services.”
The ongoing development across the CBD, most notably the light rail project, has raised some concerns by owners regarding the disruption it will cause to their tenancies.
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Despite this, the future benefits of this and other development across the Parramatta CBD will ensure that this location remains a vibrant retail hub into the future.
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*Zone 1 being the area from Parramatta River to the train line (including mall fronted properties) while Zone 2, which is known as the Chinatown end of Church Street, includes the street front retail (excluding Westfield tenancies) up to Campbell Street.In total this represents just shy of 35,000 sqm with 85 per cent represented in the Zone 1 precinct.
