Prime Yangon retail space remains almost fully occupied despite a record addition of new stock on the market last year.

As a result, city retail rents are likely to rise by 4 to 5 per cent in the near-term, reflecting high demand.

“Rents should continue moving upwards in the medium term,” said Joan Mae Lee, analyst for Colliers International’s research and advisory team, in a statement.

According to a research report from the real estate specialist, more than 79,400sqm of new space opened in the fast-growing economy’s largest city last year – more than double the amount of 2016.

However the occupancy rate held at 95 per cent which would undoubtedly make it one of the highest rates in Southeast Asia.

The report said the figure reflected business confidence in the country, where the economy is expected to grow by about 7.5 per cent in the year to March 31.

Yangon’s retail supply was boosted last year primarily by the opening of Junction City and St John City Mall which combined provided a fresh 67,000sqm of lettable area in the city.

Lee urged developers to focus on tenant diversity in new or revamped projects.  

“Landlords should aim to lure other prospective tenants, such as aesthetic clinics, wellness centres, showrooms, auxiliary service providers and inclusion of institutional occupiers to boost foot traffic,” she said.