Retail rent collection has been hardest hit by lockdowns in New South Wales and Victoria according to the latest rent data from Re-Leased, with office rent collection also impacted.
The figures from the commercial property management software company analyse rent collection levels in Australia up to 30 October 2021, and provide a snapshot of the impact of the latest lockdowns, explored for each asset class.
Rent collection for the retail sector has been the hardest hit, sitting at 75 per cent nationally, down from 84 per cent in May and June prior to the lockdowns.
Victorian retail rent collections have been hit hard over the last few months. Rent collection has slumped to just 72 per cent by day 30 of October, down from a yearly high of 82 per cent in May before the crippling fourth, fifth and sixth lockdowns.
While Victorian office rent collection has also dropped to 72 per cent by day 30 of October, down from 87 per cent at the same time in September, 86 per cent in August, and 90 per cent in July, suggesting conditions have started to bite hard for some office businesses this month after several lockdowns.
NSW retail rent collection is also languishing at just 67 per cent by day 30 of October after a yearly high of 82 per cent back in June before the state’s longest lockdown. NSW office rent collection has also been impacted at 87 per cent, down from a yearly high of 92 per cent in June.
Across all commercial property sectors on a national level, rent collected by day 30 of the month has slumped from a high of 85 per cent in May and June, to just 80 per cent in October as extensive lockdowns in Melbourne and Sydney have taken hold. Pre-pandemic in January 2020 and December 2019, this figure was at 86 per cent.
Tom Wallace, CEO of Re-Leased, said “Although Victoria and New South Wales are coming out of lockdown with eased restrictions, falling rent collection figures demonstrates business has been hit hard. Landlords will be hoping the retail sector can bounce back quickly as their ability to operate is the biggest indicator of whether they are able to pay their rent.”
“Victorian office rent collection has also dropped significantly over the last month, suggesting repeated lockdowns have also started to bite for office-based business too.”
“Unsurprisingly, retail has been hit the hardest, and we’ve all seen the crippling effects of lockdowns as businesses have been forced to close their doors.”