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SUSTAINED HEALTHY CONSUMER ACTIVITY IN ASIA PACIFIC IN THE LAST QUARTER OF 2011
27 Mar, 2012, China
Whilst the region plays a wait-and-see approach in response to the slow and steady improvement in its economic conditions, the retail industry has posted remarkably good figures in terms of sales in most markets. Global real estate services firm Cushman & Wakefield in their latest Research Retail report said that the solid economic performance underpinned the strength in consumer demand and resulted in a strong sales performance for retailers.
Mostly driven by tourism and the increase of low-cost travel around the region, consumers have indeed expanded their shopping capacity to venture to various shopping destinations across the region. Global luxury retail brands confirmed that Asia Pacific has been a major driver in their worldwide total sales. Brands such as LVMH Louis Vuitton Moët Hennessy, Hermes International and British luxury giant, Burberry all reported a jump in sales, mostly coming from Asia.
Sigrid Zialcita, Managing Director Research for Asia Pacific commented: “The narrowing prime rent differential between Hong Kong and New York City attests to the strength of retail activity in the region. . And with strong fundamentals, investment sales continued to flourish while new development boomed in emerging markets such as China and India, not to mention other retail projects in some other major key cities that are slated to finish this year also add to the steady stream of positive news in the consumer front.”
Sigrid Zialcita continues: “The outlook for the retail industry for 2012 in Asia Pacific is nothing less than continuous growth. Structural changes in government policies that will be under way are also expected to act as a strong demand catalysts for the industry. Changes that include reductions in import taxes in China to give luxury retailers a competitive edge and India’s opening up the country’s single-brand retail sector to foreign investment will altogether sustain the momentum for this industry.”
James Hawkey, Executive Director of Retail Services, China, commented, “While the China retail market is currently just half the size of the US market, the pace of growth is astounding. China is currently contributing very significantly to global retail growth. As the market continues to mature in the coming several years will see continued rapid change in the China retail scene, with no shortage of new market entrants, and a likelihood of significant merger and acquisition activity in key areas such as the grocery market.”