Soaring rents have seen London’s New Bond Street rise to become the world’s third most expensive retail street, while New York’s Upper 5th Avenue and Hong Kong’s Causeway Bay retain their first and second place rankings, according to Cushman & Wakefield.
According to C&W's annual Main Streets Across The World report, Upper 5th Avenue remains the most expensive main street in the world, with annual rents at an average of $3,000 per sq ft per year (psf/yr), while Hong Kong’s Causeway Bay retains its second place position despite a 4.7% fall in average rents to $2,725 psf/yr.
London’s New Bond Street leapt into third place in the global rankings in 2017 as rents increased by more than a third (in local currency) on the previous year to $1,720 psf/yr. The increase relative to other global destinations underlines the strength of London’s premium retail offer and strong demand for prime retail space in the West End.
Milan’s Via Montenapoleone, where rents rose 12.5% on the year to $1,433 psf/yr, was ranked fourth, while the Avenue des Champs Élysées in Paris, where rents are $1,407 psf/yr, fell to fifth place despite rents remaining unchanged over the year.
'Despite a lot of negative headlines, global retail remains as dynamic and vibrant as ever in response to technological and demographic change across the world,' commented report author Darren Yates, head of EMEA Retail Research at Cushman & Wakefield. 'Premium retail destinations, including New York’s Upper Fifth Avenue, Hong Kong’s Causeway Bay and London’s New Bond Street, are highly sought after by international brands seeking to create engaging retail experiences that offer something new and exciting. The most innovative retailers are combining their online and physical platforms to create a seamless omni-channel experience for the customer, but profile and location play such a crucial role in the premium retail experience.'
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PropertyEU Briefings at Mapic 2017
Redevco Stand (P-1.M51)
Consumer, Retail & Investment Trends
15 November, 1500-16.00
Retail Innovation & Technology
(16 November, 10.30-11.30)
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EMEA region
London’s major thoroughfares are some of the most desirable and expensive streets in the world, with rents in New Bond Street, ranked third in the global table, increasing by 37.5% to $1,720 psf/yr. Although there was a pause in activity in London in the initial aftermath of the EU referendum, the start of 2017 brought a resurgence in leasing deals.
Demand for prestigious Paris locations such as the Avenue des Champs Élysées, Avenue Montaigne and Rue Saint Honoré was resilient in the face of political uncertainty in the lead up to the French general election. Paris’s prime retail locations benefited from strong footfall generated by domestic and overseas visitors, as international tourism recovered strongly during 2017.
High Street prime rents in Italy have generally been stable over the last year, with significant upward adjustments only recorded in major cities where activity is sustained by tourism. Rents in some streets in Milan, Turin and Florence recorded particularly strong growth.
Justin Taylor, Cushman & Wakefield’s, head of Retail, EMEA, said: 'While challenges and uncertainties remain, Europe’s retail recovery has continued and a further strong performance is anticipated for 2018. Half of the top 10 most expensive high streets are in Europe which reflects strength of demand. Prime locations have the edge in attracting the most innovative and premium brands, and rising rents in some areas have been helped by strong tourist numbers. This includes the UK where the lower Sterling has increased visitor numbers significantly and London’s premium retail offer continues to thrive despite the noise around Brexit. Meanwhile, growth in Milan, Turin and Florence underlines Italy’s pulling power as a retail destination.'
