Background_E_Market_Assessment - Shoalhaven City Council ...

Nowra CBD Master Plan – Market Assessment7.4 Retail and Commercial Market ConsiderationsAccording to the 2006 ABS Census, there were 4,431 businesses in operating in Shoalhaven LGA. There has beenhealthy growth in new businesses largely due to the strong emphasis on placed on economic development by Council,which has successfully encouraged a number of firms to set up or relocate to the area.Whilst recent rental and sales evidence of retail and commercial properties are limited, an analysis of the current markettogether with discussions with local agents has indicated that:• Recent rental and sales evidence is limited, however, there are a number of retail and commercial propertiescurrently for sale or for lease in Nowra. By comparison, there are very few retail and commercial properties onthe market in the commercial centres of Kiama and Shellharbour. This suggests that the majority of existingstock in these areas is occupied and tightly held;• Traditional strip retailing along Kinghorne, Junction and Berry Streets generally have net rentals between$300/sqm and $400/sqm;• By comparison, Stockland Nowra’s anchor tenants (K-Mart and Woolworths) are paying net rents ofapproximately $230/sqm and the specialties are paying around $1,100/sqm;• Overall, the region’s retail sector is performing well, with a number of major retail and supermarket chainsoperating in the area, as well as a number of retail proposals in the pipeline;• Commercial rents in the CBD are achieving around $150-$250/sqm (net), with new commercial propertiescommanding around $300/sqm;• The Nowra CBD fringe area accommodates a number of businesses within single detached residentialdwellings within the 2(b)1 Residential zone, especially health practitioners. There are also a number of homebasedbusinesses. It’s understood that many of these dwellings contribute to the character of Nowra;• Agents indicate there is office demand in Nowra for local services like accountants, lawyers, real estate agents,etc;• There are various at grade car parking sites within the CBD that are potential infill redevelopment sites;• Mixed use developments (retail/commercial/residential) should be investigated; and• Wollongong will remain the main provider of high density stand alone commercial buildings for the region,catering for large scale government and corporate tenants.21 Kinghorne Street in Nowra recently sold in February 2010 for $850,000. The second-hand retail and office buildingcontains 3 retail shops and 3 office suites and has a total building area of 477sqm. The sale achieved a capital value of$1,782/sqm. Generally speaking, older commercial office stock in Nowra and surrounds achieve capital values in the$1,500/sqm to $2,000/sqm range.57 Graham Street, Nowra is a new commercial development for sale for $2.9m ($3,384/sqm). The ground floor café hasan internal area of around 85sqm with a 50sqm external deck and an asking rental of $30,000 per annum. The first flooris 366sqm and is currently vacant and has an asking rent of $100,000 per annum ($273/sqm). The second floor is also366sqm and is under a lease which commenced in June 2009 for $94,600 per annum ($258/sqm). There are also 11 onsite car parks.C09143 Page 39 Hill PDA