Report on the Casual Mall Leasing Market in Australia: Outlook and Trends 2025
Casual Mall Leasing (CML) is one of the major commercial trends in Australia. What was once just a way to fill vacant spaces has now become a key strategy for shopping centres, creating new opportunities for brands, entrepreneurs, and organizations.
This model not only drives additional revenue but also fosters innovative experiences for consumers, with flexibility that benefits both landlords and tenants. In this report, we explore in depth how Casual Mall Leasing is changing the game, with up-to-date data, key trends, and a look at the future of the sector.
Overview of the shopping centre Market in Australia
Market Structure
The number of shopping centre operators in Australian companies has grown by an average of 3.7% annually over the five years from 2018 to 2023.
This is due to the sector’s strong recovery after the pandemic. In fact, in 2022, major shopping centres collectively reported a record 54 billion Australian dollars in sales, indicating a strong recovery and consumer confidence in physical retail spaces.
The investment landscape for shopping centres has shown positive momentum. Reports forecast that shopping centre investment will grow by approximately 50% between 2023 and 2025, increasing from 4.2 billion to an estimated 6.3 billion Australian dollars.
Demographics and consumer preferences in Australia
Australian consumers show a preference for shopping centres that offer convenience and accessibility. Proximity to their homes or workplaces is essential, and the availability of free or reasonably priced parking is a significant draw. Additionally, they value shopping centres that combine stores, dining options, and entertainment in one location.
In this regard, the payment market in Australia is expected to grow at a compound annual growth rate of 16.44% until 2029.
In addition, 78% of Australians tend to make additional purchases when visiting stores to pick up their online orders, indicating a trend toward the “click-and-collect” model.
Trends in Casual Mall Leasing in Australia
Tenant Diversification
Casual Mall Leasing already encompasses a wide range of tenants, from e-commerce brands to local entrepreneurs and pop-up events.
This model provides digital brands with the opportunity to establish a temporary physical presence, allowing them to connect directly with consumers and test new markets without long-term commitments.
For example, Louis Vuitton opened a pop-up store in Adelaide’s Burnside Village after having a temporary store in Rundle Mall the previous year. This initiative reflects the trend among luxury brands in Australia to use temporary spaces to expand their physical reach.
Additionally, Christopher Esber, an Australian designer, opened his first physical store at Sydney’s Strand Arcade. This pop-up store, operating from December 2024 to March 2025, blends vintage design elements with a modern shopping experience, offering a selection of pieces from his Resort 2025 collection.
These initiatives highlight how casual mall leasing in Australia is enabling digital brands and emerging designers to transform the shopping experience. They provide consumers with access to new retail concepts, fostering an environment of direct and temporary interaction that revitalises shopping centres while adding a unique touch of freshness and exclusivity.
Flexible and Modular Spaces
Shopping centre operators are increasingly adopting more flexible designs that allow for quick adaptation of spaces. Modular kiosks, mobile stands, and adaptive zones are becoming more prevalent, enabling seamless transitions between various commercial uses.
Digital transformation
In Australia, shopping centres and retailers are adopting advanced artificial intelligence (AI) and automation technologies to enhance operational efficiency and the customer experience.
Although not a shopping centre, the example helps illustrate how automation has already reached all commercial sectors in Australia: Coles has implemented smart shopping trolleys equipped with AI and sensors, allowing customers to scan and pay for products directly in the trolley, streamlining the shopping process.
This type of initiative reflects a growing trend in the Australian retail sector towards integrating advanced technological solutions, such as AI and automation, to optimise processes and provide a more convenient and efficient shopping experience for customers.
Why is digital transformation essential in casual mall leasing?
Enhanced Efficiency and Automation
Digitalisation in casual mall leasing is key to improving operational efficiency, as it allows for the automation of tasks such as contract management and payments, which still pose a challenge for many shopping centres. With investments in digitalisation, shopping centres can increase their profits by up to 34%.
Improved Data Analytics
Digital platforms provide access to data analytics, offering insights into occupancy rates, pricing trends, and tenant behaviour. These insights enable informed decision-making, optimizing pricing strategies and enhancing profitability.
Enhanced Customer Experience
Digital solutions facilitate seamless interactions with tenants, offering personalized services and real-time updates. This improves tenant satisfaction, leading to higher occupancy rates and lease renewals.
Automation of Manual Tasks
Digitalisation in casual mall leasing enhances operational efficiency by automating manual tasks such as invoice management, contract generation, and financial tracking, reducing human errors and speeding up processes. Although only 32% of businesses have automated these processes, digitalisation allows companies to focus on strategic activities by reducing effort duplication and improving accuracy. By integrating all of these processes into a single digital platform, resource usage is optimised, and time is saved, which is crucial for businesses managing multiple leases.
Economic and Social Benefits
Generation of Additional Revenue
Casual Mall Leasing represents a significant source of income for shopping centres, allowing the monetisation of spaces that would otherwise remain vacant. This practice involves granting temporary licences to operate in common areas of the shopping centre, usually for a maximum period of 180 days.
According to a survey, the average duration of a business operation in a temporary leasing site is 12 days.
Support for Small Businesses
It is common for Casual Mall Leasing to be used by small businesses to test markets and build brand presence without the long-term leasing commitments.
This model provides small businesses with the opportunity to operate in a proven retail environment, access a wide customer base, and assess the viability of their products or services in the market. Additionally, it allows them to build brand presence and generate recognition without the need for long-term financial commitments.
Projections and Opportunities for 2025
Projected Growth
According to a report by Mordor Intelligence, the Australian commercial real estate market is expected to grow at a compound annual growth rate (CAGR) of 8.46% until 2029, reaching USD 51.14 billion.
The demand for flexible spaces and the diversification of retail experiences could positively contribute to the growth of this market in Australia.
Competition from E-Commerce
The rise of e-commerce has transformed the retail landscape, presenting significant challenges for traditional shopping centres. According to an article by ABI RESEARCH, e-commerce is projected to account for 25% of retail sales by 2025.
To address this scenario, Casual Mall Leasing emerges as an effective strategy to integrate digital brands into the physical environment. This model allows online brands to establish temporary presences in shopping centres, offering consumers the opportunity to interact directly with products and strengthen their brand presence in the physical market.
Diversification of the offering
Considering the growth of e-commerce, shopping centres are implementing strategies to increase foot traffic and enhance the customer experience.
For example, diversifying the offering beyond retail by incorporating entertainment attractions and services has proven effective in revitalising these spaces and attracting more visitors. According to Walltopia, this strategy has contributed to the resurgence of activity in shopping centres.
The outlook for innovation is positive: global retail projections for 2024 indicate that most retailers expect an increase in revenue of 1% to 9%, reflecting a positive trend in the sector.
Tourism
Tourism plays a crucial role in the success of casual mall leasing. According to official data, Australia welcomed 7.5 million international tourists in 2024. In this context, shopping centres have adapted their temporary spaces to offer unique experiences, such as artisanal products and cultural pop-ups.
Conclusion
As we’ve seen, the Casual Mall Leasing market in Australia is in a phase of growth and transformation, offering significant opportunities for operators, retailers, and local communities. Despite the challenges, the sector is well-positioned to capitalize on emerging trends such as digitalization, tenant diversification, and personalized experiences.
If you’d like to learn more about how digital solutions are revolutionizing the short-term leasing sector worldwide, we invite you to read our blog. Discover more about the trends and tools that are helping to transform this market.
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