Retail sector holds steady in early 2026 as demand and tourism support growth

Record tourism spending and high occupancy support rising rents as retail supply stays tight through 2028.

Singapore’s retail sector continued to show stability in early 2026 with overall retail sales remaining firm, supported by a combination of domestic consumer demand and the gradual return of regional tourists, according to the Singapore REITs: 2026 Q1 report by Morningstar Equity Research.

Prime retail rents in the Orchard Road and Core Retail Belt remained largely steady, whilst vacancy rates held below 5% in key shopping districts.

The report highlighted that well-located malls with strong footfall and anchor tenants continued to outperform the broader market.

Leasing activity remained concentrated in lifestyle, food & beverage, and experiential retail segments.

Morningstar cited that retail REITs maintained high occupancy levels across flagship mall even whilst projecting that new retail supply over 2026 to 2028 will be limited, particularly in prime areas. This constrained pipeline, coupled with stable demand, is expected to support continued resilience in the sector.

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Morningstar, Inc.

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