Prague Is The World's 17th Most Expensive Shopping Destination
26 Oct, 2005, Prague
Rents on Na Příkopě Street keep growing, and retail units there are at eur 160/sqm/ month. Prague copies the worldwide trend - rentals on the main shopping streets have gone up by an average of 8 per cent. This is indicated in the Main Streets Across the World, an annual report by Cushman & Wakefield Healey & Baker (C&W/H&B),the European division of the leading real estate consultancy, Cushman & Wakefield.
"The race for prime retail space is continuing unabated both in the Czech Republic and internationally. The number of retailers who want to have their outlets in the top shopping destinations continues to increase, which in turn is pushing up rents," says Jan Kotrbáček of C&W/H&B, who focuses on retail unit leasing in the city centres. "Last year on Na Příkopě Street, a square metre was let at EUR 150/month, this year the rent is about 7 per cent higher."
New York's Fifth Avenue, where a tenant has to be ready to pay EUR 11,558/sq m/year, is placed first in the ranking same as in the previous years. This means EUR 3,150/sq m/year more than a year ago (up by 38 per cent). Also Hong Kong has recorded an enormous rise in rental - from last year's EUR 5,036/sq m/year to almost a double, EUR 9,625/sq m/year. It has leapfrogged Paris' Champs Elysées (EUR 6,628/sq m/year), leaving it in the third position.
"What is also apparent is the huge gap not only between the first and second, but also the second and third position - an incredible EUR 3,000/sq m/year. Thus, Hong Kong is up to 50 per cent more expensive than the most popular shopping avenue in Paris," notes Martin Žížala, head of retail agency at C&W/H&B.
"Emerging markets such as China and India start to dismantle barriers to foreign investment, and hence become more attractive to cross-border retailers and developers. The importance of major Asian cities is increasing. Three of them are among the top ten - Hong Kong, Tokyo and Seoul - and all of them have moved up the ranking towards the top in comparison with last year," adds Martin Žížala.
In the central and eastern European region the highest rentals are charged in Moscow, EUR 2,808/sq m/year (11th position). Prague follows in the 17th position with its EUR 1,920/sq m/year. The 22nd position is held by Bulgarian Sofia, which was included in the survey for the first time this year. Tenants will pay up to EUR 1,560/sq m/year there.
Budapest is placed 30th, with EUR 1,200/sq m/year, which means it has fallen from last year's 29th position. Rumania´s Bucharest with its rents of EUR 840/sq m/year is placed 36th, and the 37th position is shared by Bratislava and Warsaw. In both cities the rent is EUR 720/sq m/year.
"What is interesting is that this year Bratislava and Sofia were included in the survey. This indicates their growing importance on the world's map of major shopping destinations. Sofia even reached the top thirty most expensive locations in the first go. This is due to the shortage of quality retail space in that country and the demand massively exceeding the supply of such space," comments Martin Skalický, a consultant at C&W/H&B.
"The slight rise in Prague rents has pushed our capital up the ranking to the 17th position, which it shares with neighbouring Vienna. On Vienna's Kärntnerstrasse and on Na Příkopě, the rent is up to 60 per cent higher than on Budapest's Váci utca and two-and-a-half times higher than the prime shopping streets in Warsaw and Bratislava. The rent is the result of retailers' enormous interest in the centre of Prague," notes Jan Kotrbáček.
Main Streets Across the World 2005 tracks retail rents in the world's top 237 shopping locations across 47 countries around the world. The report's global league (see the table) is drawn up by taking the most expensive street in each of the countries monitored.
Only 18 locations out of the 237 monitoredshow a fall in rents, with the remainder either seeing rents stable or growing. Rents increased fastest in Asia Pacific (with, for example, Hong Kong recording 90 per cent growth), followed by Tokyo with an almost 70 per cent growth.
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