Location, location, location! Sometimes a location is more than a location, it’s a brand.
The CEOs of Tiffany & Co., Bergdorf Goodman and Harry Winston already know this real estate tidbit as their flagships are located on Fifth Avenue between 56th and 58th streets in Manhattan…some the most coveted and expensive retail stretch in the world.
Retailers looking to set up shop on Fifth Avenue – between 59th and 42nd streets – can expect to spend $1,500 a square foot. To put that into context, many shops on that stretch are around 20,000 square feet, making annual payments about $30 million a year.
Even as stock prices and consumer confidence slide, the world’s elite addresses, like New Bond Street in London, Ginza in Tokyo, Bahnhofstrasse in Zürich, Switzerland, or Avenue des Champs-Elysees in Paris are not showing signs of stress.
This month, Abercrombie & Fitch signed a lease for 90,000 square feet at 666 Fifth Avenue (at 53rd Street) and agreed to pay over $2,000 a square foot. British retailers Topshop and Reiss are in the midst of an international expansion, especially in the U.S, and Apple opened its first flagship store in London.
Still, that doesn’t mean retailers aren’t aware of the slowdown. "People are using a slowdown as a negotiating tool," says Jeffrey D. Roseman, executive vice president of Newmark Knight Frank Retail, the New York arm of the London-based firm. "But once it’s all said and done, retailers are not necessarily losing business from it. The folks buying the $5,000 or $10,000 suits, or $1,000 shoes aren’t as affected by what’s going on in the world."
In Asia, Hong Kong is home to luxury shoppers. Foreigners can visit on a passport, and Chinese can travel freely to the city because of its status as a special administrative region. Guess where the huge shopping districts for Chinese and international wealth form as a result? In Hong Kong’s Causeway Bay, a district built on fill, retail goes for $1,213 per-square-foot per year.
While the highest-end properties continue to hold out, the big questions for the remainder of 2008 and into 2009 are how long properties, retail and office can hold up in the face of a global economic slowdown as investors and businesses alike start to feel the pinch.
But no matter how much you worry about real estate, it’s safe to think that the draw and status of places like Ermou Street in Athens, Greece, or Grafton Street in Dublin, Ireland, along with Fifth Avenue in New York, will hold their value longer than other neighborhoods.
Here is the top ten list of the world’s most expensive retail real estate:
10. Gangnam Station
Seoul, South Korea
Price-per-square foot, per year: $431
9. Ermou Street
Price-per-square foot, per year: $451
8. Pitt Street Mall
Price-per-square foot, per year: $489
Price-per-square foot, per year: $492
6. Grafton Street
Price-per-square foot, per year: $669
Price-per-square foot, per year: $683
4. New Bond Street
Price-per-square foot, per year: $814
3. Avenue des Champs-Elysees
Price-per-square foot, per year: $922
2. Causeway Bay
Hong Kong, China
Price-per-square foot, per year: $1,213
1. Fifth Avenue
New York City, N.Y.
Price-per-square foot, per year: $1,500
Read "World’s Most Expensive Retail Addresses" here
Source & Photos: Financail Times & ForbesSee the Top Ten Summer 2016 Trends for Women Over 40
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