Centre managers said improving the tenancy mix was the key to driving growth.

Centre managers said improving the tenancy mix was the key to driving growth. Photo: Paul Rovere

SHOPPING centre managers remain cautious about the outlook, but there are signs emerging of a recovery in retail spending, a survey finds.

Across the country, retailers are still struggling with challenging trading conditions and tenant inquiry remains subdued, the latest Jones Lang Lasalle survey of centre managers shows. But sentiment among retail managers has improved slightly.

The survey found:

■At least 55 per cent of centres expect some growth in sales over the next 12 months.

■Turnover in sub-regional centres grew by an average 2.8 per cent in the year to September, while neighbourhood centres grew by 2.7 per cent.

■Centre managers report slightly stronger tenant inquiry levels, up from 9.6 per cent of respondents in the June quarter to 16 per cent in September.

■Vacancy rates decreased in sub-regional centres but increased across neighbourhood centres.

Face rental growth is still being reported, although it is being offset by incentives like rent-free periods and fitout contributions.

Centre managers said improving the tenancy mix was the key to driving growth.

A broader mix of services was being targeted to replace struggling retail categories and fill vacancies, JLL's research director, David Snoswell, said.

Surprisingly, vacancy rates have remained low, despite a challenging retail market.

''Incentives have been the key to maintaining high occupancy for many centres,'' JLL's head of property management, Richard Fennell, said.

But the difficult retail conditions have not slowed investment interest.

The sector remains robust, according to CBRE research manager Tammy Smith.

Ms Smith said there was more than $500 million of transactions in the September quarter with private investors dominating.

Momentum increased in 2012 with a 29 per cent improvement in total transactions in the year to September 30 compared with the same period last year.