An influx of top international brands moving to Perth, including the recent addition of Brazilian shoe company M Dreams on Murray Street, are likely to push out smaller retailers.
Lease Equity director Fred Clohessy, who signed up M Dreams, fashion labels Zara and Top Shop and coffee empire Nespresso to the city, said big box retailers had their sights set on Perth. But with limited space, smaller retailers may have to migrate elsewhere.
Sources claim Sweden's renowned H&M fashion label and Japan's Uniqlo are in serious talks for retail space on Murray Street.
It is understood American homewares company Williams Sonoma wants to set up in the vacant Borders bookstore on Hay Street.
"With other international big name, big box retailers looking for a position in Perth, the natural evolution is that a number of smaller retailers may have to find new homes," Mr Clohessy said.
"This increase in demand for small shops and the natural limitation of space available in the Perth CBD at the moment may drive up rents."
M Dreams director Susannah Kerr and business partner and store manager, Josephine DeBrito, claim the presence of other international brands on the mall influenced their decision to set up on the strip.
"We were always mindful of positioning M Dreams in Perth in a high traffic area among other high fashion retailers," Ms De Brito said.
The shoe brand opened its doors at the end of Piccadilly Arcade a few weeks ago. It is the first Perth store for the 30-year-old brand, which already has a presence in 80 countries.
Mr Clohessy said it was challenging to find stores that are big enough to suit the demands of the fashion brands, which often involved a 15m to 18m street frontage.
He predicted there would have to be some amalgamations to meet the big fit-out requirements of the stores.
Zara and Topshop, for example, have each secured more than 2000sqm of space.
He said the Treasury Development to the east and Cloisters Arcade to the west of the malls were also attractive retail opportunities.