More and more, retail expansion is making its way slowly and steadily through the neighbourhoods of greater Sydney, extending high streets and around corners into residential strongholds where to date, the only commercial transactions may have been the private sale of a car, or perhaps a cup of homemade lemonade on a summer’s weekend.
As modern life places increasing demands on already stretched families, time-poor, dual-income households crave the convenience and sociability of the local precinct, while affluent suburbs embrace high-end restaurants and cafes. As a result, suburban retail expands its habitat, keeping pace with Sydney’s urban renewal.
Wherever it goes, this phenomenon enriches the locale, infusing it with new life, community, and ambience. For the strategic developer, it is an opportunity to capitalise on unrealised value and the potential to grow and meet a new wave of residential buyer demand.
In suburban areas, the potential for developers is to invest in new residential developments with a ground-floor retail component. The seminal example of Waterloo’s Danks Street over the past decade is an iconic point in case.
A once-bleak thoroughfare running through a suburb that comprised mostly housing commission flats was seemingly overnight transformed into a bustling cosmopolitan neighbourhood. The arrival of numerous high-end retail and food offerings created an eclectic mix between the old and the new, pushing up local property values. But beyond the almighty profit, pride can be taken in having pioneered the revitalisation of this area.
This phenomenon is apparent throughout Sydney, with high-density suburbs embracing retail offerings. Corner grocers, eateries and home-wares stores spring up in historically residential addresses, either due to general gentrification of an area or the expansion of a successful retail precinct that has reached capacity and must extend beyond its traditional borders.
Take O’Brien Street or Hall Street in Bondi, for example: with beachfront residential and retail opportunities at capacity, this sought-after offering must extend west, in time, towards Old South Head Rd, which itself presents a plethora of retail expansion opportunities as it winds its way into Rose Bay, with the buzz of Dover Rd on one side and the recent Coles-led precinct on the border of Vaucluse.
Here, opportunities abound for developers who take a long-term view for the residential/retail mix that will inevitably be necessary to meet the demands of a high-disposable-income area with a taste for convenient local shopping, dining out and overpriced fruit.
The expansion of existing retail in suburban areas lends itself to developers who are prepared to buy and hold. The true potential of this approach lies in long-term income and the continued expansion of the local retail offering towards the development of a precinct that, in time, will command a premium value.
As part of the due diligence process, potential developers should consider which types of retail offerings will continue to attract people and support the continued evolution of the area – and design with this vision in mind.
In areas that already support high-traffic food offerings, there may be opportunities to expand the retail/fashion side. In this case, the requirement is to invest for and design in a manner that supports the taste of the expanding local market.
This theory extends beyond the retail offering at ground level and up into the residential floors above, where developers must cater to the sensibilities of the demographic associated with the retail offering.
Where are the opportunities?
Look for signs of retail expansion, where local councils are evidently sympathetic. In many cases, a popular existing strip will have reached capacity while demand for the area continues unabated.
Case in point: 518a Old South Head Road, Rose Bay
A new land offering is available on the corner of Old South Head Road and Dover Road in Rose Bay. Currently a community church, this piece of land is a prime example of a mixed use opportunity for an existing retail strip to extend off the high street.
Currently zoned for mixed use, this parcel of land finds itself on a corner, sandwiched either side by a busy village retail strip. With existing foot traffic, thanks to the centrality of this loaction, a perfect opportunity exists for a savvy developer to further enhance the area’s already attractive retail offering.
This phenomenon is already being realised further up Old South Head at number 538, where a residential development’s advertising boards signal a corner retail offering.
In a sought-after area such as this, retail and residential offerings have a symbiotic relationship, feeding one another and ensuring an ever-increasing demand for the area and, in time, out-performing results for the patient developer.
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