London’s New Bond Street has retained its crown as the UK’s most expensive street by store rental value, with its rent significantly higher than all other UK retail locations, even in London, according to data from Cushman & Wakefield.
The annual ‘Main Streets Across the World’ report, now in its 30th year, tracks 446 of the top retail streets around the globe, ranking them by their prime rental value according to Cushman & Wakefield’s proprietary data, which includes a list of the top streets in 65 countries.
New Bond Street’s annual rent of US$1,744psf/yr puts it first in the UK and Europe and third globally behind Upper 5th Avenue, New York (US$2,250 psf/yr) in second. For the first time in five years Hong Kong’s Causeway Bay takes top spot globally, with average rents costing US$2,671 psf/yr.
From a purely UK and Ireland perspective, seven of the top 10 locations are in London with only Dublin’s Grafton Street and Henry Street, along with Glasgow’s Buchanan Street breaking up the monopoly.
Of the UK locations in the survey, Edinburgh’s Princes Street has seen the largest rental increase, rising by 11.6% over the year to June 2017 to US$218 psf/yr, closely followed by Shop Street in Galway, which has increased by 9.1% to US$132 psf/yr.
Rents across the South West have remained stable with Bristol’s Broadmead achieving US$84 psf/yr,which was the same as 2017.
Spencer Wilson, Partner at Cushman & Wakefield in Bristol comments: “Despite the challenges of the retail sector this year, many of the principal towns and cities in the South West, including Bath, Exeter, Cheltenham, as well as Bristol have remained robust, largely due to an affluent catchment profile, large student populations and growing tourism.
“There is still a healthy future for these locations but we are moving to a ‘beyond retail’ phase driven by societal and technological change meaning business models will also need to adapt. Traditional retail will survive and in many prime locations prosper but is likely to form a smaller part of the overall occupier mix and we are likely to see a wider mix of uses such as food halls, cinemas, bowling, health & fitness and services.
“We have seen this evidenced recently at Regent Arcade in Cheltenham, where a boutique cinema, Tivoli, is set to replace the vacant BHS unit next year. The new £23 million John Lewis department store in Cheltenham has also helped to boost footfall in the town centre, with the store offering value added services such as personal styling, home design and beauty treatments.”
Report author Darren Yates, Head of EMEA Retail Research at Cushman & Wakefield, said: “There is still a significant appetite for premium retail sites globally, with the top retailers using stores as part of their customer experience strategy.
“While global trends are not completely uniform, there are some common themes. The most notable include the continued growth of online, omni-channel retailing as standard and significant investment in store design. While technology is still a major disruptor in retailing, it is also enabling physical retail to fight back as it allows retailers to better understand their customers and to enhance the in-store experience.
“New Bond Street’s dominance underlines London’s attraction as an important location for retailers particularly at the premium end of the market. Overall, thoroughfares across the Capital have generally maintained their rental values. However, around the UK, the polarisation between prime and secondary locations is increasingly evident, which is reflected in the wide disparity of rental levels and vacancy rates.”
