Prime rents continue to grow worldwide
Published: 02 June, 2011
London’s West End is still one of the world’s most expensive retail destinations as retailers focus on the major fashion capitals, pushing global rents in prime locations even higher, according to the latest CB Richard Ellis Global Retail MarketView
The increased demand for the limited amount of prime retail stores led to a rise in global rents in the first quarter of 2011. In Asia, rents rose steadily, underpinned by the ongoing expansion of international luxury and ‘fast fashion’ brands. Rental growth in the Americas is slowing, but remains positive, while Europe, Middle East, and Africa (EMEA) experienced a marginal increase over the last quarter. In general, there is still downward pressure on rents in secondary markets.
New York’s Fifth Avenue remains the world’s most expensive high street destination, with rental values reaching US$1,900 per sq ft pa - an increase of more than 10 per cent in the last 12 months. London’s West End (US$909 sq ft pa) held fourth position despite rental growth remaining flat year-on-year.
Overall rents in EMEA grew by just 0.5 per cent as concern about the PIIGS (Portugal, Ireland, Italy, Greece, Spain) economies increased and high unemployment continued to affect consumer expenditure growth.
Peter Gold, head of cross-border retail - EMEA, at CB Richard Ellis, said: “In general, retailers are targeting a wide range of markets, with demand particularly high in Germany and Poland. In spite of the challenging trading conditions, occupier demand for prime pitches in key European cities is still strong and this includes markets that are facing some of the most challenging economic conditions such as Ireland and Spain. It is arguably an ideal time for retailers to access prime space in these markets as rents are low.”
