Islandwinde retail rents dip as vacancy jumps

Overall vacancy rate rose to 7.2%.

The Urban Redevelopment Authority (URA) reported that retail rents dropped by 4.1% in 2015, on back of a sharp increase in space supply.

The stock of retail space increased by 22,000 sq m in the last quarter of the year, compared to the 24,000 sq m decrease in the preceding quarter.

As a result, the island-wide vacancy rate of retail space rose to 7.2% at the end of the fourth quarter, from 7.0% at the end of the third quarter.

The URA also noted that as at the end of the fourth quarter, there was a total supply of 808,000 sq m gross floor area (GFA) of retail space from projects in the pipeline.

Retail space completion will remain above 200,000 sq m per year until 2018, before dropping sharply in 2019.