Cushman & Wakefield has unveiled the second edition of its European Luxury Retail report on new luxury store openings in Europe. It reveals that 83 new luxury stores opened in 2024 across Europe's top 20 shopping arteries, in 16 cities in 12 countries, down from 107 in 2023.
"The fashion and accessories segment accounts for almost half of all openings (41). Jewelry and watch brands opened a total of 26 stores in 2024, compared with 21 in 2023, as 'pure luxury' continues to appeal to luxury consumers," the consultancy's report says.
In detail, brands owned by LVMH, Richemont and Kering account for just over a third of new openings. "This total is in line with that of 2023, but the breakdown between the three groups has changed, with LVMH coming out on top with 15 store openings in 2024," points out Cushman & Wakefield.
For the consultancy, the slight reduction in the number of store openings reflects not only a slowdown in sales growth in the luxury sectorbut also the dynamics specific to each market and, in particular, the availability of locations targeted by the brands. "Vacancy has largely tightened overall, with 17 of the top 20 thoroughfares having vacancy rates below 5%, and six streets fully occupied."
Low vacancy rates and rental growth
According to Cushman & Wakefield, low vacancy rates and brands' appetite for highly targeted locations have helped to boost rental growth on luxury arteries to positive 3.6% in 2024 compared to 3% in 2023. Rental levels on these arteries are also 3% higher on average than in 2018.
"A third of luxury thoroughfares across Europe reached record rental levels in 2024, including Milan's Via Montenapoleone, the world's most expensive retail destination," comments the report, which anticipates rents on luxury thoroughfares to rise by 1% to 3% per annum between 2025 and 2028.
Major luxury groups continue to make long-term investments in retail locations on key luxury thoroughfares, particularly in London, Paris and Milan. "These investments are strategic and highly targeted, in order to maintain brand positioning on emblematic axes, thus justifying the commitment of significant capex to transform these physical spaces into veritable showcases," notes the board.
"With a growing appetite for 'more in-store experience,' many luxury brands are actively looking for opportunities to increase the surface area of their stores," explains Sally Bruer, head of retail for the EMEA region at Cushman & Wakefield. "These enlarged spaces enable brands not only to offer wider product ranges, but also to create exclusive experiential zones for their customers."
"Constrained by the lack of available locations, retailers have to be creative. Real estate strategies include expanding existing stores onto adjoining lots or floors, or relocating to new, more spacious premises, to position the store as a true brand vector," continues Bruer. "We're already seeing an impressive number of luxury retail openings for 2025 and beyond, which are set to increase further as economic conditions improve and brands commit to continuing their real estate development strategies."
What about the French market?
Against this backdrop, what about the French market? After a period of intense activity for the luxury sector in 2023, the pace of openings in Paris slowed in 2024. The four key luxury streets in the capital welcomed seven new luxury openings. Three opened on avenue des Champs-Élysées, two on rue Saint-Honoré, and one each on rue du Faubourg Saint-Honoré and avenue Montaigne. Of these, three were brands owned by luxury giant LVMH and two by Richemont. In particular, Loewe and Chloé invested in major renovations of their flagship stores.
Additionally, the pace of openings continued in the regions, particularly in the main resort cities. "The Avenue de Suède in Nice, in particular, as well as luxury locations across Saint-Tropez and Cannes, saw a notable influx of new luxury store openings," says the consultancy.
However, according to Cushman & Wakefield, "signings recorded an increase of almost 30% in the capital compared with 2023, and Paris will very soon once again become the epicenter of luxury retail, totaling ¾ of the year's signings," according to Cushman & Wakefield.
"In view of the commitments made in 2024, we should see the opening of several flagships by major players in the sector in the coming months, all of which will focus on the configuration of premises with the aim of offering an enhanced customer experience," says Vincent Ascher, head of key luxury accounts for France at Cushman & Wakefield.