Could Bunnings and Officeworks downsize stores after COVID?
Bunnings and Officeworks could ditch warehouse outlets and shift to smaller city stores in the aftermath of COVID-19, commercial property agents predict.
CBRE retail services director Zelman Ainsworth says businesses are looking for “less bricks and mortar” to reduce operating costs in the future.
He says retailers will not go “back to an inefficient way of working”, which will change the commercial market landscape.
“Larger retailers in the inner city are looking for smaller format metro stores … places like Bunnings, Woolworths, Coles and Officeworks,” Ainsworth says.
“There’s a real push from tenants to lease spaces which already have existing fit-outs, so there’s less costs involved.”
A Bunnings spokeswoman told the Sunday Herald Sun there were no plans to relocate any stores or open up boutique shopping outlets.
But the hardware retailer does have plans to be part of an upcoming luxury Mercure hotel in Doncaster.
“We are always looking at opportunities to innovate the design of our stores and we have a number of different formats that cater for the local markets where we operate,” Bunnings’ acting general manager of property Garry James previously told Leader.
Artist’s impression of the Mercure Hotel and Bunnings Warehouse development in Doncaster. Picture: Supplied.
Full Circle Property Buyers director Rob German says customers of all ages will opt to shop online even after the pandemic, which would encourage businesses to downsize shop space.
He says there will be a shift of retailers moving to smaller shops in the same suburb they already operate.
But there will still be a place for warehouses and factory spaces in the future.
“Factories and warehouses are becoming popular again, as they’re places that online shops can hold their stock,” German says.
9 Biddy Court, Moorabbin was leased by an online produce supplier.
“People also want to buy more Australian-made products, which could help manufacturers and add demand to warehouses too.”
Home produce company Urban Farm is one business capitalising on consumer behaviour changes.
They recently leased a Moorabbin warehouse to store their fruits and vegetables, after recording some of the largest sales growth in Australia via their online platform.
The property at 9 Biddy Court will stock some of the company’s hardier produce like potatoes, carrots and onions.
This article from The Herald Sun originally appeared as “Bunnings and Officeworks could downsize stores after pandemic”.
