Canberra property: vacant space left by Dick Smith closures may be hard to relet, group says

A national property report has singled out Canberra as the city where retail space left vacant by the imminent closure of Dick Smith stores may be difficult to relet.

Australia’s largest independent property advisory group, Herron Todd White (HTW), forecasts steady activity in Canberra’s retail market this year but warns that businesses may not be quick to take up Dick Smith sites in some precincts.

“After the opening of some major retail centres in the city last year including IKEA … we are of the view that 2016 will be a year of consolidation for Canberra”, the HTW’s Month in Review February report says.

“The only downside we see on the horizon is the impact of Dick Smith departing from major malls in the ACT as we have observed that vacancies are difficult to fill in these centres.

“The electronic chain has six stores in Canberra that are set to close as early as this month following the announcement in February that administrator Ferrier Hodgson had failed to find a buyer for the embattled operation’s 301 stores in Australia and 62 outlets in New Zealand.

Westfield, which has Dick Smith stores at its Belconnen and Gungahlin centres, is confident the sites are in locations that will appeal to other retailers.

“While we can’t comment on individual stores, the 40 sites Dick Smith has at Westfield centres are in desirable locations that we would expect other retailers will find attractive,” a Westfield spokesperson said. Colliers international Canberra leasing executive Aaron Bruce believes the size and prime location of the Dick Smith sites may entice more big brand retailers to Canberra.

“We are seeing some well known brands expanding down into Canberra from Sydney and Melbourne and international retailers taking the plunge here because the market is big enough,” Mr Bruce says.

“With the size of the Dick Smith sites, you are obviously not going to have small local retailers moving in unless the area is split, as the space is simply too big.

“But having those new high profile sites available might just attract some new entrants into the Canberra market.”

Most Dick Smith sites in Canberra are more than 500 square metres, Mr Bruce says.