“Footfall numbers continue to improve, but expenditure and retailers’ confidence is lagging.”

JAMES MACDONALD, SAVILLS RESEARCH



New projects and evolving retail formats continue to shape the market.

• Retail sales fell 0.7% YoY in the first five months of 2024. The wholesale & retail sectors decreased by 0.5%, and accommodation & F&B sectors declined by 3.1% YoY.

• Only one new project within the Outer Ring Road was launched in Q2/2024, adding 98,000 sq m of new supply to the Shanghai retail market.

• The citywide vacancy rate increased by 0.1 ppt in Q2/2024, reaching 11.7%, but decreased by 1.0 ppt YoY. Prime retail area vacancy rates declined by 0.2 ppt QoQ to 9.4%, while non-prime retail areas saw a 0.1 ppt QoQ rise to 12.2%. • First-floor rents fell by 0.6% in Q2/2024 to an average of RMB25.7 psm pday, down 0.7% YoY.

• With the arrival of the summer holidays, the newly leased area for children-related services has shown steady growth, and the demand for education and training has rebounded.

• Brands are extending consumers’ dwell time or enhancing revenue efficiency through various store-in-store formats or by directly entering other brand spaces.

• Seven shopping malls are slated to open in 2H/2024, collectively adding 645,000 sqm of retail space.