Orchard’s retail vacancy rate edged up to 6.6% in 4Q2025, alongside a negative net absorption of 5,000 sqm (54,000 sq ft) (Photo: Samuel Isaac Chua/EdgeProp Singapore)
Retail rents in Singapore rose 0.6% q-o-q in 4Q2025, slowing down from the 0.9% q-o-q growth observed in the previous quarter, according to the latest real estate statistics released by the Urban Redevelopment Authority (URA) on Jan 23.
At the same time, prices of retail space were up 1.7% q-o-q in 4Q20205, reversing the 0.7% q-o-q decline recorded in 3Q2025.
“Singapore’s retail property market continued to show steady underlying demand, even as retailers navigate a more challenging operating environment,” notes Chua Yang Liang, head of research and consultancy for Southeast Asia at JLL.
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Leonard Tay, head of research at Knight Frank Singapore, echoes this sentiment, adding that rising operating costs and competition have led to high-profile exits. Recent closures include Twelve Cupcakes, Wan Yang Health Products and Foot Reflexology, and Art Works Gallery.
Despite this, Tricia Song, head of research for Singapore and Southeast Asia at CBRE, notes that leasing activity remained “healthy” during the quarter. URA data indicated a positive net absorption of 34,000 sqm (366,000 sq ft) in the islandwide private retail market, extending the positive net absorption in Q3 2025.
This came alongside a net decline of 4,000 sqm (43,056 sq ft) in new stock, pushing islandwide retail vacancy rates down to 6.3% in 4Q2025 from 7% in the previous quarter.
According to Knight Frank’s Tay, the F&B sector has continued to drive leasing demand due to Singapore’s position as a “global wealth hub and a strategic gateway to markets in Southeast Asia.
New entrants within the F&B landscape include Chick-fil-A at Bugis+, Coach Restaurant at Jewel Changi Airport, and the expansion of Butter & Cream Bakery.
That said, Tay notes that retail and F&B operators are “turning towards a more conservative approach to expansion, deployment of capital expenditure and store network optimisation”.
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He adds that Chinese F&B brands – one of the most active segments in the retail landscape – are moderating their expansion, pursuing quality over aggressive outlet expansion. This includes strategies such as relocating to higher-traffic locations, outlet refurbishments, and the introduction of differentiated product variants.
“Increasingly defined by refinement rather than scale, operators are recalibrating their strategies to suit a more competitive trading environment and discerning consumers,” says Tay.
Vacancy rates within the outside central region (OCR) submarket contracted to 4.4% in 4Q2025, down from 5.9% recorded in 3Q2025, observes CBRE’s Song. The region also saw the highest net absorption of 19,000 sqm (205,000 sq ft).
Song attributes the momentum observed within the OCR submarket to the tenant-take up at Lentor Modern Mall, which was completed in August 2025.
On the other hand, Orchard’s retail vacancy rate edged up to 6.6% in 4Q2025, alongside a negative net absorption of 5,000 sqm (54,000 sq ft). This came on the back of the vacation of tenants in Taste Orchard ahead of the Dec 31 deadline, notes Song.
With limited new supply till 2028, Knight Frank’s Tay expects occupancy in well-managed malls to remain steady given ongoing flight to quality. As at end-4Q2025, retail supply in the pipeline stood at 560,000 sqm (6.03 million sq ft).
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CBRE’s Song adds that annual completions over the next three years are projected to fall below the historial average. Near-term additions include smaller malls such as Canninghill Square and Parc Point Tengah, which are slated for completion in 2026, while larger developments, including Tanglin Shopping Centre and Bukit V mall, are expected to be completed in 2028.
With the addition of increasing tourist arrivals and a robust pipeline of MICE events, Knight Frank’s Tay projects prime retail rents to increase by 2% to 4% in 2026.
That said, he adds that secondary malls are likely to observe more “modest growth or flat rental performance” due to continued headwinds stemming from cost pressures and consumer trade-down.
CBRE’s Song concurs, projecting a more modest forecast of 1% to 2% growth in overall prime retail rents.