Australia’s CBD retail landscape is showing clear signs of adaptation and renewal. While challenges remain, the first half of 2025 highlights resilience in consumer demand, fresh opportunities for investors, and city-specific strengths that are beginning to shape a new phase of growth. With 5,614 outlets surveyed nationally, the results point to a market that is finding its footing and creating space for selective expansion.
National Trends
- Vacancy is stabilising across most capitals, reflecting a market that is moving beyond the sharp dislocations of recent years.
- Consumers are returning, supported by migration, international students, and tourism inflows. Weekend and evening trade is strengthening, lifting confidence in core precincts.
- Capital is seeking quality: investors remain highly engaged in prime CBD and experiential retail, positioning well-located assets for long-term performance.
City Level Insights
Sydney: Vacancy is elevated, but this presents a generational opportunity for retailers to secure prime locations at favourable terms. Luxury precincts are thriving, reinforcing Sydney’s role as Australia’s international gateway.
Melbourne: Recovery is gaining traction. Migration and student growth are bolstering demand, while vibrant weekend and evening activity is anchoring resilience. Melbourne’s retail scene is rebalancing and primed for further uplift.
Brisbane: The market is returning to balance, supported by population growth and rising confidence ahead of the 2032 Olympics. Retailers are well-placed to leverage Brisbane’s long-term demographic and infrastructure tailwinds.
Perth: Remains Australia’s strongest CBD retail market, underpinned by high incomes and robust consumer spending. Low vacancy reflects sustained retailer demand and confidence in the city’s growth story.
Adelaide: Momentum is building gradually. Infrastructure projects and student inflows are contributing to steady improvement, with food and beverage operators leading the way.
The Opportunities
Landlords: Embrace repositioning to experience-driven retail formats that capture resilient consumer spending.
Investors: Look to Perth and Melbourne as leaders in stabilisation, with Sydney offering compelling entry points in prime locations.
Retailers/Occupiers: Expand selectively into markets where demographic and tourism trends are aligning with recovery, particularly Melbourne and Brisbane.
The Outlook
The first half of 2025 marks a turning point. Australia’s CBDs are not only adapting but also creating new pathways for growth. From Perth’s tight market to Melbourne’s strengthening demand and Sydney’s unique repositioning opportunities, the outlook is increasingly constructive. Stakeholders who act with agility now stand to benefit from the next chapter of CBD retail evolution.
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