Colliers International: Luxury Retail's Growth is Spurring Strong Performance of High Street Markets

SEATTLE, Nov. 18, 2014 /PRNewswire-USNewswire/ -- Leading global commercial real estate services firm Colliers International today released the highlights of its latest global retail report. The study looks at 125 retail real estate markets in 50 countries across the globe and offers insights into current performance and trends for the near future. A major theme running through this year's report is that luxury retail continues to show strong growth in the top global markets and prime cities in Asia.

One key factor driving luxury sales includes a rising consumer confidence level due in part to a fading memory of the recent global economic crisis. (In fact, Nielsen's Q214 Global Consumer Confidence Survey reveals an increase in consumer confidence in 52 percent of markets surveyed.) Another factor in the growth of luxury retail is the sizable gain in income of the highest earners—driving an increased propensity to spend.

"Our analysis of the global retail real estate environment reveals what we have been seeing this year—a retail market that is cautiously optimistic and steadily growing in many sectors despite some hiccups of caution due to threats to global economic growth and the shadow of e-commerce," said Anjee Solanki, National Director, Retail Services | USA, Colliers International. "Luxury, in particular, serves as a major spark to the expansion we are seeing, and this is even in regions such as Europe and Asia with weak GDP growth and consumer spending."

Other key findings include:

• Luxury retailers are in the sweet spot. Luxury retailers are benefitting from income gains among the top earners and are thriving throughout many of the top global markets, including Paris, London, New York and prime cities in Asia. The growth in this sector is a key factor in driving expansion across the board, as noted below.
• New supply is robust in developing markets. The global expansion of the workforce and the middle class is spurring a need for new supply, which is concentrated in developing countries in Europe, the Middle East and Asia that have economic growth, political stability, a growing middle class and business-friendly regulatory environments.
• Optimism is tempered by threats to global economic growth and the specter of
  e-commerce. E-commerce is affecting both traditional and luxury retailers across the globe, exerting pressure on merchants to become more creative with concepts regarding their use of space. One popular strategy is to transform stores into product showrooms in an attempt to entice greater foot traffic and additional online sales.
• Strong performance of high street markets and growing development in emerging markets. The generally positive outlook is underpinned by the economic recovery in the U.S. and strong job growth in many parts of the globe.

Among the top 10 global retail rents for the year (per square foot in USD), New York's Fifth Avenue is the pinnacle, with NYC's Madison Avenue also on the list, while Hong Kong holds three spots. The list is rounded out by one spot each for (in alphabetical order, not by prominence) London, Milan, Moscow, Paris and Zurich.

For more results from Colliers International's Global Retail Highlights, please visit www.colliers.com/globalretail.

ABOUT COLLIERS INTERNATIONAL
Colliers International is a global leader in commercial real estate services, with more than 15,800 professionals operating out of more than 485 offices in 63 countries. A subsidiary of FirstService Corporation, Colliers International delivers a full range of services to real estate users, owners and investors worldwide, including global corporate solutions, brokerage, property and asset management, hotel investment sales and consulting, valuation, consulting and appraisal services, mortgage banking and insightful research. The latest annual survey by the Lipsey Company ranked Colliers International as the second-most-recognized commercial real estate firm in the world.
 
For the latest international news from Colliers International, visit colliers.com/us/news, or follow us on Twitter: @ColliersIntl.

SOURCE Colliers International