Demand continues in West End retail market

London’s West End retail market is boosted by intense demand from international investors.

16 October 2014, words by Marie Hickey

 

■ The West End retail market has seen intense occupational and investor demand over the last three years. Since 2012 alone, 67 new international entrants have opened their first UK store in London.

click on Graph 3 to enlarge

Graph 3

■ Prime Zone A rents in the core West End have increased by an average of 10.1% per annum over the last three years, exceeding the 9.4% seen for average prime West End offices.

■ Occupational demand is intensifying due to a number of factors. London's rising prominence as a major tourist destination; expected growth in Chinese and Gulf State visitors due to visa application streamlining; and 'cheaper' prime rents relative to other Global cities such as Hong,Kong, New York and Paris.

■ For example, the Middle-East based 'The Toy Store' have just agreed to open their first UK store on Oxford Street at a record Zone A rent of over £900 per sq ft. Savills advised the landlord.

■ Availability constraints on the traditional streets of Bond, Oxford and Regent has meant retailers have looked to new pitches in order to satisfy demand, particularly in the 'Luxury Quarter' close to Bond Street.

■ Mount Street is already a relatively well established alternative to Bond Street. However, Dover and Albemarle streets (Bond Street fringe) are emerging as destinations for luxury brands. Considering their comparatively low rents these streets are likely to see the most significant uplift in rents going forward.

  

 
 

Key Contacts

Mark Ridley

Mark Ridley

Chief Executive Officer
Savills UK & Europe

Savills Margaret Street

+44 (0) 20 7499 8644

 

Marie Hickey

Marie Hickey

Director
Commercial Research

Savills Margaret Street

+44 (0) 20 3320 8288

 

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