A bright spot: Opportunities for investors in Australian nondiscretionary retail
The nondiscretionary retail space in Australia is an exception to the general gloomy sentiment directed at the retail sector. This is somewhat similar to the discretionary/nondiscretionary bifurcation in the United States, but distinguishing factors make the Australian retail proposition more compelling — and possibly unique in global retail.
Investment proposition and the impact of COVID-19
I began planning this article in another era, before the onset of COVID-19. At the time, I was involved in assisting a major Australian group in securing an offshore investor as a capital partner for its growing nondiscretionary retail platform. Although on a pure performance and fundamentals basis the proposition for nondiscretionary retail was — and remains — abundantly clear, it was also apparent sections of the market were not properly appreciating the distinction, with cap rates across the retail sector softening appreciably. But while discretionary sale