CBRE

FIGURESADELAIDERETAILIQ32025

6.05%

LargeFormatRetailyield

32%

Regionalcentresyo-YNetFaceRentGrowth

93%

13%

CBDvacancyRate,H125

SAEconomicGrowth2025-26'1

FIGURE1:southAustraliaMonthlyHouseholdspending(seasonallyAdjusted)

Note:Arrowsindicatechangefrompreviousquarter.

keypoints

--o-

reboundinconsumersentimentdrivenbyeasingcost-of-livingpressures.

-

Lecornusiteredevelopmentat88o'connell(fordevelopments23,000).Retailsupplyin2025issettototalc.22,800sqm,slightlybelowthe10yearaverageofc.28,200sqmp.a.

--o--o-

$1,600/sqm.Averagenetfacerentsremainedstableq-0-qacrosstheotherretailcategories.

-

decliningtrendthathadbeenseensinceH12022.

-

transactions≥$5million).

--0-

whilecBDsuperprimeretailyieldsexpandedby25bpq-o-qtoanaverageof5.00%.

+5.2%

year-on-yeartoAugust25

+0.5%

Month-on-MonthtoAugust25

source:ABS,CBREResearch

Economicoverview

TemporaryeconomicdriverssustainAustralia'seconomicgrowth

InQ22025,Australia'SGDpgrewby0.6%q-0-q(seasonallyadjusted,chainvolumemeasures)

and1.8%y-o-y.Despiteunderlyingsoftness,thisgrowthwasfuelledbyrobustretaildiscounting,holidaytimingandspendingrelatedtotheFederalelection.publicinvestmentwasthemain

obstacletoexpansion,whereasnettradeprovidedamodestboost,largelydrivenbyexportsofminingcommodities.

southAustralia'seconomygrewby1.2%in202324,aftera3.6%increasetheyearbefore.

AccordingtoDeloitteEconomics,thestate'seconomyisexpectedtogrowatarobustrateof1.5%in202425.Thisgrowthisbolsteredbydoubledigitgrowthinstatedwellinginvestmentandan

increaseinhouseholdspending.

HouseholdspendinghasemergedasakeydriverofsA'seconomicgrowth

Householdexpenditurerecordedconsistentgainsoverthepastyear.InAugust2025,householdspendinginthestaterose5.2%y-o-y.Theoutlookremainspositive,asconsumerscontinueto

spendacrossdiscretionarycategoriessuchashotels,cafesandrecreationactivitiesalongwithhouseholdfurnishings,hintingatgrowingconfidenceandresilienceinthestate'sdomestic

economy.

FIGURE2:southAustraliaHouseholdspendingy-0-ybycategory

14%

10%

2%

-2%

-6%

-10%

3mthsendAug-253mthsendAug-2410-yearAverage

source:ABS,CBREResearch

SAlabourmarketisshowingsteadygrowthbutremainstightandcompetitive

InJuly2025,thestate'semploymentroseby0.3%(seasonallyadjusted),bringingthetotalnumberofemployedpeopletonearly980,000.Theunemploymentrateheldfirmat4.3%,suggestinga

relativelytightlabourmarket.Meanwhile,theparticipationrateremainedstableat64.3%,reflectingconsistentengagementfromtheworkingagepopulation.

Adelaide'sprimarysectorsarehealthandsocialwork,whichmakeupc.14.9%oftotalGrossvalueAddedandwholesaleandretailtrade,contributingc.10.3%.Adelaideisrapidlypositioningitselfasagloballeaderinbiomedicineanddefencerelatedresearch,anchoredbythetransformative

AdelaideBioMedcityprecinct(anongoing$3.8billioninvestmentdevelopment).

FIGURE3:unemploymentRatebystate(%)(seasonallyadjusted)

source:ABS,CBREResearch

InternationalmigrationhasbecometheprimaryengineofsA'spopulationgrowth

AsofMarch2025(latestavailable),SA'spopulationgrowthismoderateyetsteady,witha1.1%y-o-yincrease.AccordingtotheABS,thisgrowthislargelyfuelledbystrongnetoverseasmigration

(+18,748),whichcompensatesforanegativenetinterstatemigration(1,470).Incomparisontofaster-growingstateslikewesternAustraliaandvictoria,southAustralia'sgrowthremains

subdued.

supply

Adelaide'SQ32025retailpipelineremainsmuted,withmajornon-metroLFRdevelopmentsinthepipeline

Retailsupplyin2025isforecasttototalc.22,800sqm,slightlybelowthe10yearaverageof

c.28,200sqm.InQ32025,around6,000sqmofnewretailspacewasdelivered,primarilyinthe

stripretailcategory,drivenbytheredevelopmentoftheoldLecornusiteat88o'connellstreet,

NorthAdelaide.Thismixedmmuseprojectincludesresidential,retailandpublicspacesandmarksa

significantactivationoftheprecinct.

In2026,southAustralia'sretailsupplypipelineisexpectedtoexpandsubstantially,with

c.55,400sqmofnewspace-wellabovethelong-termaverage.AmajorcontributoristheMountGambierHomemakercentre,alargeformatretaildevelopmentinanon-metrolocation,adding18,400sqm.AnotherkeyprojectistheMarketsquareredevelopmentinthecBD,whichissettodeliver4,000sqmofgroundfloorretailaspartofabroadermixeduseprecinctfeaturing

offices,residencesandapremiumhotel.

In2027,Adelaideissettoseeanotablewaveofretailcompletions,particularlyinlargeformatretail(69%)andneighbourhoodcentres(31%),highlightingatrendofinvestmentbeyondthemetropolitancore.keyprojectsincludeoldportwakefieldRoad'STwowellsTowncentre

(9,500sqm)andBunningsMountBarker(16,300sqm).

vacancy

RetailvacancyintheAdelaidecBDroseto9.3%inH12025,markingareversalofthedownwardtrendobservedsinceH12022.whileoverallvacancyacrossthecBDhadbeengradually

declining,therisewaslargelyattributedtoelevatedvacancylevelsatoneofthecBD'smajorcentres,whichoutweighedthereductionsobservedacrosssurveyedstripandarcaderetail

locations.

withinthecBDcentres,whichincludeRundleplaceandMyercentre,theoverallvacancyrateforH12025increasedto15.3%,upfrom11.3%recordedinH22024.vacancyatRundleplace

remainsrelativelylow,witharateof6.0%reportedforH12025.

FIGURE4:AdelaideRetailsupplybycategory

80,000sqm

70,000sqm

60,000sqm

50,000sqm

40,000sqm

30,000sqm

20,000sqm

10,000sqm

osqm

201420152016201720182019202020212022202320242025F2026F2027F

CBDRegionalsubRegionalNeighbourhood

LargeFormatstrip10-yearAverage

source:CBREResearch

FIGURE5:AdelaidecBDvacancyRatebyHalfyear

Rentalperformance

Regionalcentresleadrentalgrowthduringthequarter

DuringQ32025,regionalcentresinAdelaideexperiencedthestrongestrentgrowth,withnetfacerentsincreasingby0.8%q-o-qand3.2%y-o-y,reachinganaverageof$1,600/sqm.Large

formatretail,whichhadrecentlyledrentalgrowthrates,sawnetfacerentsremainstableqmmmmq

(+3.2%y-0-y),reportingat$265/sqm.

AlthoughstableduringQ32025,averageincentivesforsuperprimecBDassetsdeclinedby174bpy-o-y,whileincentivesforneighbourhoodcentresfellby94bpy-o-y.Thisdownwardtrendinincentivesisattributabletoagradualshiftinlandlordconfidence,drivenbyimprovingtenant

demandintopmmtierassets.

Adelaide'sretailmarketiswellpositionedforrentgrowthoverthenextyear.Alimitedpipelineofnewretaildevelopments,combinedwithhighconstructioncosts,iskeepingsupplytight,

whileputtingupwardpressureonrents.Atthesametime,thecity'spopulationcontinuestogrowsteadily,supportingdemand.consumerspendingisalsopoisedtoimprove,aidedbyfurtherinterestratecuts,whichshouldboosthouseholdconfidence.

FIGURE6:RetailNetFaceRents(Q419toQ325)

FIGURE7:southAustraliakeyLeasingRatesbyRetailAssetcategory

CBDsuperprime

stable

stable

3,002

stable

+1.9%

8.3%

stable

-174bp

Regional

+0.8%

+3.2%

1,363

+0.8%

+3.2%

14,8%

stable

stable

subRegional

stable

stable

578

stable

stable

14。2%

stable

stable

Neighbourhood

521

stable

+2.7%

448

stable

+3.8%

14,1%

stable

-94bp

LargeFormatRetail

265

stable

+3.2%

228

stable

+3.2%

13.8%

stable

stable

source:CBREResearch

FIGURE8:NetFaceRentGrowthbyRetailAssetcategory

3.5%

3.0%

2.5%

2.0%

1.5%

1.0%

O.5%

0.0%

CBDRegionalsub-RegionalNeighbourhoodLargeFormatRetail

superprimeshoppingcentresprime

Y-o-YGrowth

Q-o-QGrowth

InvestmentMarket

In2025,transactionvolumescooledpost-2024peak

witharecord$1.1billioninretailinvestmenttransactionvolumesrecordedin2024,investmentvolumesduring2025havebeenrelativelysubdued.AcrossAdelaide,c.$156millionof

transactionshavebeenrecordedforyTD(fortransactions>$5million).

Themostnotabletransactionrecordedin2025wasthesaleofkurraltaparkvillage.TaplinGrouphaveacquiredtheassetfromcolesGroupforanadjustedpriceof$74.6million.Thistransactionaloneaccountsfornearly48%oftotalyTDvolumeinGreaterAdelaide.This

acquisitionhighlightscontinueddemandforneighbourhoodandconvenience-basedretailcentres,particularlythoseanchoredbysupermarketsorofferingessentialservices.Theseassetsareseenasresilientamideconomicheadwinds.

whilevolumesaredown,pricingforqualityassetsremainsfirmasvendorsarenotunder

pressuretosellatdiscounts.Areboundinactivityispoisedtooccurinlate2025early2026asmacroeconomicconditionsstabiliseandmarketsrecalibrate.

yields

Retailyieldsarepoisedtocompressinlinewitheasinginterestrates

InQ32025,regionalcentreyieldsexperiencedanotabledecreaseof15bpq-o-q,settlingatan

averageof7.08%,whilesuperprimecBDyieldsexpandedby25bpqmmommqto5.00%.yields

remainedstableq-o-qforsubregional(6.46%),neighbourhood(5.94%)andlargeformatretail(6.05%).

withfurtherratecutsonthehorizoninlate2025andearly2026,Adelaide'sretailyieldsarepoisedtotightenasbuyeractivityrampsupandpricingbenchmarkssharpen.This

environmentislikelytoacceleratecapitaldeployment,particularlyintohighmmperformingassetswithstrongtenantcovenantsandlongleaseprofiles.

FIGURE9:AdelaideRetailsalesbyAssetcategory

$1,000

$800

$600

$1,200

$400

$200

$-

20152016201720182019202020212022202320242025

CBDRegionalsubRegionalNeighbourhood

LargeFormatother---10-yearAverage

source:CBREResearch

FIGURE10:AdelaideRetailyieldsbycategory

contact-Research

katyaEzhova

ResearchAnalyst

+61421547176

katya.ezhova@cbre.com

kateBailey

HeadofRetailandAlternativesResearch

+61438528352

kate.bailey@cbre.com

sameerchopra

HeadofResearch,pacificandESGAPAC+61422242830

sameer.chopra@cbre.com

?Copyright2025.Allrightsreserved.Thisreporthasbeenpreparedingoodfaith,basedonCBRE’scurrentanecdotalandevidencebasedviewsofthecommercialrealestatemarket.AlthoughCBREbelievesitsvi