Shopkeepers fear terminal rent rises: [1 Edition]
Cathryn Jimenez, John Stapleton. The Australian; Canberra, A.C.T. [Canberra, A.C.T] 26 June 2002: 4.
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Abstract
Andrew Schaffer, of Sunglasses @ Sydney, said: “From word of mouth, I have got the feeling that it might be good.”
Optimistic: Mr Schaffer, from Sunglasses @ Sydney, reflects on news of the sale of Sydney airport yesterday and what it might mean for businessPicture: Glenn Campbell; Photo: PhotoTable
Full Text
RETAILERS at Sydney airport sent a warning yesterday to the new owners: any rental increase would be terminal.
“Trading conditions are very tough … any increase would make our job very hard,” said a store manager of one international retailer, who did not want to be identified.
“Retail here has been tough for the past 12 months due to September 11 and we already have three stores competing with us that are selling tax-free.
“I would hate to see where we would end up if the rents are increased.
“I would not see the point in keeping the stores open.”
Other shops, however, were more optimistic.
Andrew Schaffer, of Sunglasses @ Sydney, said: “From word of mouth, I have got the feeling that it might be good.”
Most of Mr Schaffer’s customers are travellers, although some airport and airline staff also shop there.
“Some people say the rents might go up, but I think that is codswallop,” he said.
“I can’t see the rents going up. They know what the economy is like here. If you look at the effect of September 11, we are not doing as well as we imagined.
“The new owners may well come in with a whole heap of new ideas on how to make money here. Hopefully, they will. Our profits are their profits.”
The airport recently started an advertising campaign that encourages Sydney residents to bring children along for a day out — even if they are not travelling.
However, retailers are not enthusiastic about the results of the campaign.
“Management has tried to promote the airport by spending thousands of dollars on marketing, but it’s not bringing people in,” one store manager said.
The big price paid by the Macquarie group yesterday made some retailers nervous.
“One wonders a lot when big prices like that are paid, what the implications will be for rents,” said a spokesman for an international retailer with several stores at the airport.
What the new owners bought
Aircraft charges $101m (32.4%)
Retailing $93.6m (30%)
Property $60.5m (19.4%)
Carparks, car rentals, billboard ads $53.9m (17.3%)
Other $2.8m (0.9%)
Total revenue: $312.7m
Operating profit (after tax): $42.84m
Total employees: 488
Total passengers: 23.1 million
International: 8.3 million
Domestic: 13.4 million
Regional: 1.4 million
Aircraft gates: 70
All figures 1999-00, Sydney Airports Corporation annual report
Illustration
Caption: Optimistic: Mr Schaffer, from Sunglasses @ Sydney, reflects on news of the sale of Sydney airport yesterday and what it might mean for businessPicture: Glenn Campbell; Photo: PhotoTable