Central London shop rents hit highest growth rate since 1988
Rents for Central London stores soared by 9% in the final quarter of 2015, recording the fastest level of growth for the sector since 1988. In the whole of 2015, high street shops in Central London saw a 18% jump in rents, driven by the growing demand for units in some of London’s most popular shopping destinations.
The growth in shop rents in Central London was contrasted by the rest of the UK, which saw a moderate increase of 0.8% in the fourth quarter, according to the latest CBRE Prime Rents and Yields Monitor. Over the 12-month period prime rents and estimated capital values for shops outside Central London increased by 1.0% and 3.2% respectively.
During the busiest season of the year for UK retailers, footfall declined by 3.9% and retail sales grew moderately by 0.1% year-on-year, while e-commerce sales grew by 15% during the period.
Phil Cann, Head of UK Retail, CBRE commented: “The Christmas period has been a mixed bag for retailers, with retail sales rising slightly on December last year, despite a marked retreat in footfall from UK high streets. Nevertheless, Central London continues to boast some of the most sought-after retail spaces in the world, a fact brought to light by the quite remarkable jump in rents toward the end of 2015.
Luxury retailers are chasing very limited available stock, sending rents soaring as they pay to place themselves at the heart of London’s luxury marketplace.”
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