New York’s Fifth Avenue is holding on to its spot as the world’s most expensive retail street to rent space, with Milan’s Via Montenapoleone climbing to second place, according to Cushman & Wakefield’s ‘Main Streets Across the World’ report.
The report looks at headline rents in what the brokerage calls "best-in-class urban locations" across the world, which are often linked to the luxury sector. It includes a ranking of the most expensive rents featuring the highest in each country.
The 33rd edition finds that retail rents on Via Montenapoleone grew 20% over the past year to $1,766 per square foot a year to displace Hong Kong’s Tsim Sha Tsui, which dropped to third after 4% rental growth to $1,493 per square foot. Rents at Fifth Avenue held steady at $2,000 per square foot.
Europe has three of the top five most expensive retail streets globally, with London’s New Bond Street in fourth and Avenues des Champs-Élysées in Paris fifth respectively, and five of the top 10.
Rob Travers, Head of EMEA Retail at Cushman & Wakefield, said in a statement that vacancy in super-prime retail locations remains tight and that is leading to competitive tension when rare sites become available which feeds through to rents.
"Even as concerns over consumers cutting discretionary spending have been affecting the economy, retailers have been securing or enhancing flagship stores in key markets."
Cushman reports that rents across global prime retail destinations increased on average by 4.8% in local currency terms over the past year. The strongest growth was recorded in Asia-Pacific, which averaged 5.3%, with the Americas at 5.2% and Europe at 4.2%.
London has held its position as one of the foremost luxury retail cities globally, with New Bond Street remaining the fourth most expensive retail location with a rent of $1,462 per square foot. Sloane Street is the second most expensive location in the UK capital with a rent of $684 per square foot, an increase of 5% on 2022.
Cushman says the London is still recovering from the impacts of the pandemic, with most areas still below pre-COVID rents.
Peter Mace, co-head of Central London Retail at Cushman & Wakefield, said in a statement: “Mirroring luxury retail’s performance across Europe, the presence of New Bond Street in the global rankings speaks to the selective demand for the capital’s very best luxury location, with discretionary spending impacting areas that prioritise mid-market and high-street brands."
The table in this article was updated on 27 November to correctly show the seventh column as euros per square metre per year.