Foresyte Report: News Release

FOR IMMEDIATE RELEASE

Friday, January 11 2019

Rise in retail building consents

Online shopping hasn’t quite delivered the killer blow to bricks and mortar retail, if the rise building consents for commercial buildings such as shopping malls is any indication.

Statistics NZ says the value of building consents issues for shops, restaurants, and bars, social and cultural buildings, factories; and farm buildings all increased between $100 million and $300 million in the year ended November 2018.

“Construction costs rise each year, but even accounting for price rises, there was a significant increase in the value of shops and social buildings consented,” says construction statistics manager Melissa McKenzie.

The amount of media that IKEA has received today just by its CEO Jesper Brodin
announcing it intends to open a store here – no details on where or when, just that it thinks it will and when it does meatballs will be served – shows just how popular the in-store shopping experience remains.

A report by NZ Post – which is obviously keen to talk-up online retail – states that online shopping accounts for 8.1% of retail in this country, and that puts us in the middle of the pack globally.

China has the largest percentage of online shopping, accounting for 23.1% of all retail, surpassing the US and making the country an example of where thing may be heading in the virtual shopping mall. This includes the move to greater personalisation, which depends on people’s willingness to give up their data for a better shopping experience. A PwC report claims 61% of Chinese consumers are comfortable for retailers to monitor their shopping habits.

Globally, online shopping is estimated to make up 17.5% of all retail spending by 2021 or put another way, 82.5% of purchasing will still be in-store (unless there is entirely different retail experience I’m missing) in two years. Which is good news for those investing in building new retail spaces, and for CEOs of large international retailers paying a visit downunder.

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