In the annual financial reports of the mega Australian property group Stockland, there is a glimpse into the future of retail. Its grand portfolio of retail assets is awash in red ink, while their big list of logistics hubs is suddenly worth more.
Take the Merrylands Shopping Centre in northern Sydney as an example. It contains an ALDI, Coles, Woolworths, Big W, Kmart and Target, plus “more than 200 speciality stores including a child care facility located on the rooftop”. 2020 has knocked its value down 12%.
On the other side of Sydney is the Ingleburn logistics park. Almost 30 hectares of big sheds and concrete near the M5 motorway. It thrives.
People still want things, we’re consuming more than ever. We still need trucks, it is shops we’re losing the need for. 2020 has seen the value of Ingleburn rise 9%.
Get used to seeing delivery vans speeding past vacant retail frontages.
I know Crikey is a Melbourne based business but getting simple geography wrong is poor journalism. Merrylands is in the west of Sydney not the north, and is close to Parramatta. We in Sydney can put up with the confusion over Rugby Union and Rugby league but please verify non Victorian locations that you are not familiar with.
“The retail data doesn’t lie. Australians are consuming more than ever — it’s the physical stores we don’t need.”
… or, if you force people to stay at home, they will shop in a different way. That does not necessarily mean that they won’t want to go to shops once the pandemic is over.
On-line purchases amount to about 30% of sales to the value of a notebook at US$800. Car parks are not needed when confidence in on-line buying increases. That area could be used for stock.
The general global trend is that people are getting buy with less. Assuming that the claim that “Australians are consuming more than ever” is accurate could the purchasing be described as semi-stockpiling?
A lesson in Sydney geography is required here. Merrylands in just south of Paramatta and Ingleburn is in the the far Southwest, nowhere near the M5 which runs East-West.
6 posts and 2 from Sydney getting their nose out of joint over errors in Sydney geography !
Being a Melburnian and former Hobartian I am so over Sydney centric media getting my local geography wrong ! Not worth getting uptight over…
This is all a bit genero-centric or something. Many people prefer the social interaction of malls and shops. Even the 20-somethings. Where else will you sneak out with your uncondoned girl/boy friend? These generalisations are reminiscent of the tabloids – deliberately outragious to elicit a response – “run for the hills, the sky is falling due to a drop in value of a few shopping centers.
Agreed. I have been hearing since the 80s that bricks and mortar retail is dead.
It wasn’t then and isn’t now. Short term figures only illustrate short term fads (or forced lockdowns).
People want interaction and communication and shiny new stuff to try on and buy.
It has been proven year after year.