New York's Fifth Avenue heads rankings of the world's top shopping streets
25 Oct, 2006, New York
New York's Fifth Avenue has retained its top position as the world's most expensive shopping street in the world, according to Main Streets Across the World 2006, an annual report by Cushman & Wakefield, the world's largest privately held real estate services firm.
An average 1,000 sq ft/93 sq m unit on Fifth Avenue, at its most expensive stretch near the junction with 57th Street, now costs around US$1.35mn a year.
Gene Spiegelman, Executive Director of Cushman & Wakefield in New York, comments: "The world's top brands are jostling for position in this prime stretch of retail. This is not just about sales at the till, but about the brand value of retail real estate. In a world of advertising 'clutter', we see companies increasingly leveraging their brands through real estate and Manhattan's Fifth Avenue is a prime example of this trend."
The trend-setting Abercrombie & Fitch flagship at 56th Street and Nokia's flagship on East 57th Street, which follows Apple Computer's success at Fifth Avenue and 59th Street, as consumers continue to pursue advances in technology and communication, are among this year's most high-profile openings on Fifth Avenue. Waiting in the wings is what may be the world's highest value retail lease - that of the former Asprey store at Trump Tower at 56th Street.
Main Streets Across the World 2006 tracks retail rents in the world's top 233 shopping locations across 47 countries around the world. The report's global league table is drawn up by taking the most expensive location in each of the countries monitored.
John Strachan, Cushman & Wakefield's Global Head of Retail, says: "Shopping is a global activity – from the main streets of Buenos Aires, to New York, Paris and New Delhi. Worldwide, the sector has seen a vibrant year, with new store openings, new formats, retailers entering new markets, in particular the emerging markets, and existing schemes being refurbished in more developed markets to cater for evolving consumer and occupier demand."
The world ranking sees little movement at the top, with Hong Kong (Causeway Bay) retaining its second place and Paris (Avenue des Champs Elysées) its third place. The biggest riser is the Indian capital of New Delhi, with the most expensive location being Khan Market, having gone up 17 places to now be in 24th place.
Sanjay Dutt, Executive Director for Transaction Services, Cushman & Wakefield in India, says: "The 'organised' retail sector in India is forecast to grow by around 40-45 per cent on an annual basis over the next five years. Currently it has a mere 2 -3 per cent share of the total market, but this is foreseen to grow to up to 12-14 per cent by the end of this decade."
India's retail growth story has been spurred by the country's rapid economic growth and by increasing levels of disposable income, together with a higher consumer awareness towards the Western shopping environment and entertainment trends.
With respect to Khan Market, the most expensive location in India, Sanjay Dutt says: "Branded players look for quality space in a good location, which is exactly what Khan Market offers. This in turn has pushed up rents in the district because of a lack of available space. The area is located in the heart of a premium residential pocket, housing diplomats, industrialists, civil servants and high-net worth individuals, and offers a mix of local and international brands, including Nike, Benetton, Swarovski, McDonald's, Barista and Bandhej, among others."
Other significant risers in the ranking are the Belgian capital Brussels (Rue Neuve), up five places to 23rd, and the Romanian capital Bucharest (Bulevardul Magheru), up six places to 30th, with activity boosted with Romania on track to join the European Union in 2007.
On a regional basis, Asia Pacific has seen the highest rental increases in local currency terms; rents are up 20 per cent in the year to June 2006. India's retail locations have all seen big rental increases, and, adds Sebastian Skiff, Cushman & Wakefield’s Head of Retail in Asia Pacific: "In China, the government has recently approved a significant number of applications by foreign retailers, unlocking the doors for a flood of new retailers entering what is one of the world's most dynamic emerging markets."
Worldwide, rents rose or were stable in 97 per cent of locations monitored, falling in only three per cent. Looking ahead, Darren Yates, Associate, European Research, Cushman & Wakefield, and the report’s author, says: "The demand for modern retail property will continue to grow worldwide, in particular with the opening up of large and increasingly wealthy consumer markets such as India, China, Brazil and Russia, where the demand for consumer goods is growing rapidly together with the need for top-class retailers and high-quality retail facilities."
Notes to Editors:
1. Main Streets Across the World is based on data collected in June 2006 from Cushman & Wakefield’s offices around the world. The data relates to the rent obtainable on a standard unit (frontage of six metres and depth of 25 metres) in a prime pitch.
2. Cushman & Wakefield is the world's largest privately held real estate services firm. Founded in 1917, the firm has 195 offices in 55 countries around the globe, and 11,000+ talented professionals. Cushman & Wakefield delivers integrated solutions by actively advising, implementing and managing on behalf of landlords, tenants, and investors through every stage of the real estate process. These solutions include helping clients to buy, sell, finance, lease, and manage assets. C&W also provides valuation advice, strategic planning and research, portfolio analysis, and site selection and space location assistance, among many other advisory services. To find out more about Cushman & Wakefield, please visit the firm's web site at www.cushmanwakefield.com.