Of the 26 global luxury locations tracked by Savills over a third reported year-on-year growth in 2018 with 50% maintaining headline rents. Six of the top nine performers were the key luxury locations in European destination cities with Asia Pacific cities taking the remaining top spots
Paris was the lead performer with a 20% growth in prime indicative asking rents with Avenue Montaigne reporting a rise from €15,000 to €18,000 per sq m per annum over a 12-month period. This was driven by an improving tourist market, particularly from China, although this has been recently tempered by the gilet jaune protests in the city. Improved tourist spend in Hong Kong supported a return in occupier confidence and with it rental growth in its core luxury area.
The growth, and resilience, of headline asking rents across a number of ultra-prime luxury locations underlines how important strategically located physical stores remain for global brands. This is even more pronounced in heritage markets, such as Paris and London, where availability on its key luxury streets is heavily constrained.
Top Nine Global Cities For Luxury Retail Rental Growth
Source: Savills Research
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