London street has 'top shop rent' in Europe
- 21 September 2010
- From the section Business
London's New Bond Street is now the most expensive retail location in Europe, according to a report.
Shop rents rose to $836 (£536) per square foot per year, higher than those on Paris's Avenue des Champs-Elysees, property firm Cushman & Wakefield said.
The street, through Mayfair, is home to many exclusive brands including Armani.
New York's Fifth Avenue remains the most expensive shopping strip in the world for firms, followed by Causeway Bay in Hong Kong and Ginza in Tokyo.
Rents on New Bond Street jumped by 19.4% year-on-year, the report said.
The highest rents within shops - for the immediate front area with exposure to the street, known as "Zone A" - rose to £925 per square foot per year on New Bond Street.
Demand from firms to secure premises was easily outstripping supply, driving rents higher, said Cushman & Wakefield's head of central London retail, Peter Mace.
"New Bond Street remains one of the most sought after locations in the world for luxury brands," he said.
"This trend is likely to continue for the foreseeable future on the basis that there are still a large number of retail requirements that remain unsatisfied."
International retailers looking for prime locations and strong tourism meant that emerging markets were seeing steep rent rises, added the report, which looked at data from 59 countries.
Haddock Lobo street in Sao Paolo, Brazil saw rents climb by 92%. In Asia, costs on Mumbai's Linking Road climbed 33%. But some Bulgarian streets saw retail rents slide by 50%. Paris's Avenue des Champs-Elysees fell by 9.5%.
The report said that, having seen sharp dips of up to 25% in some parts of the world in 2008-09, two-thirds of locations had seen retail rent prices rise or remain static in the year to June.
"The aftershocks of the global economic recession are still being felt in the retail property market and the path leading from recession to recovery has been far from smooth," said John Strachan, Cushman & Wakefield's global head of retail.
"In the more mature markets, occupiers are expected to remain cautious and selective about the space they take. However, on the great shopping streets of the world in cities such as London and New York, demand has continued to exceed supply and the appetite of international brands has resulted in rental uplift.
"The world's emerging economies looks set to experience significant growth in the retail sector, thereby boosting demand for good quality, well-located property."
The UK's five most expensive retail areas were all in the English capital, with Birmingham's High Street ranked number six, followed by Newcastle's Northumberland Street.