The area of exclusive designer shops has also moved up the listings to become the third most expensive shopping street in the world behind Upper Fifth Avenue in New York and Causeway Bay in Hong Kong, according to commercial property specialists Cushman & Wakefield’s (C&W) 29th annual survey of main streets around the globe.
However, the fall in the value of sterling during 2016/17 led to a rise in the number of visitors and shoppers from overseas and the resulting increase in footfall enabled retailers to swallow the 37.5% hike in business rents that they experienced over the same period of time.
Businesses in the area can now expect to pay $1,719 (£1,455.17) per square foot (psf) a year to rent shop space, but they still have some way to go before they have to cough up the $3,000 psf a year that retail space currently costs on Upper Fifth Avenue or the $2,725 in Causeway Bay.
Other cities where businesses have to pay over $1,000 psf a year for a presence on prime shopping streets include Milan’s Via Montenapoleone ($1,433), the Champs Elysées ($1,407), Tokyo’s Ginza ($1,200) and Sydney’s Pitt Street Mall ($1,000).
“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 Darren Yates, C&W’s head of EMEA retail research and author of the report.
“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.”
Nevertheless, if the number of visitors begins to fall, UK businesses could do worse than head off either to eastern Europe or Africa where the value for money is better. To rent space in Windhoek in Namibia, for example, will cost them $25 psf a year while, in Tallinn’s Viru Street, retail space commands rents that are slightly higher at $41.