Slower economic recovery is a risk for retail rents

High interest rates have taken longer to percolate through the economy than we expected, but we now think consumer spending will contract over the next six months. That poses a risk to our retail rent forecasts. However, the sector will still benefit from consumers switching away from expensive services to cheaper goods and, after a large correction, rents may have room to grow again, albeit slowly. We are therefore sticking to our above-consensus call for a 0.9% y/y rise in retail rents in 2024.