Planning Reform Policy
It is the case that shopping centres tend not to be located within close proximity of one another and as such shopping centres often dominate local commercial retail real estate markets and consumer shopping habits.
The positioning of shopping centres and their affect on local retail markets and commercial retail real estate markets existing in local strip shops and high streets gives rise to the notion that specialty retail space in shopping centres lacks close effective substitutes within a confined suburban or inter-suburban geographic area.
Arguably the effect of introducing a shopping centre into a local retailing environment can be the potential change in the nature, quality and consumer characteristics of the pre existing local retail space.
This position is supported by the Productivity Commission's findings in their 2007 report into The Market for Retail Tenancy Leases in Australia, where it was found that "zoning and planning controls affect the location, quantity and use of retail space" (Draft Report, p.60 :2007).
The impact of the shopping centre on the locally available alternate retail formats and the effect of zoning controls in limiting competition places the shopping centre managers in a position as the principal supplier of effective retail floor space.
The Federation believes that restrictive planning laws, and the consequent effect on the supply of retail floor space, contributes to the ability of shopping centre landlords to exert significant price control over respective local market for specialty retail floorspace. The ultimate effect of which could be increased price for retail goods, subject to the capacity of retail tenants to pass on costs in customer prices.
The Federation welcomes the Australian Government's commitment to refer planning reform to the Council of Australian Governments (COAG).