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| | | | 04/11/2016 | Egi, Amber Rolt - Luxury retailers abandoning Bond Street | | | | | Luxury retailers abandon Bond Street on back of rising property costs | | | | | Egi reports that crippling business rate rises and increasing rents are forcing luxury retailers to abandon their traditional heartland of Bond Street, W1.
Five retailers occupying some 21,000 sq ft have recently instructed advisers to dispose of their shops on Old Bond Street and New Bond Street, with some sources suggesting as many as 20 are reconsidering their stores.
Belstaff is seeking a circa £7m premium for its flagship store at 135-137 New Bond Street, while Ralph Lauren Children’s Store is selling 143 New Bond Street for a £4m premium. Ermenegildo Zegna is also exiting its only UK stand-alone shop. CBRE is handling the sale.
Watches of Switzerland at 11a Old Bond Street has instructed Cushman & Wakefield to sell its lease at an annual rent of £1.5m pa. It also has a shop on nearby Regent Street and a new store on Oxford Street, W1, which broke the rental record in November 2014. The Camper shoes shop at 28 Old Bond Street is also available for a £4m premium.
David Harper, founder of retail agency Harper Dennis Hobbs, said: "The decline of the Chinese shopper together with business rates valuations and rapidly escalating rents has caused retailers to hesitate."
Rents on Bond Street averaged around £950 per sq ft five years ago, while the latest record rent on the street - £11.5m pa by Polo Ralph Lauren - represents £2,225 per sq ft.
Business rates are also set to surge. Average rates will increase from £380 sq ft to £720 per sq ft zone A, according to JLL.
Harper added: "While London remains a global city, Brexit has delayed a number of decisions relating to flagship acquisitions. Luxury is performing well at the moment but, generally speaking, luxury brands are reducing the number of stores they have to focus on a finer experience and fewer outlets." |
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