Bond Street’s ‘super luxury’ profile intensifies as proportion of luxury stores rises to 73.9% - Savills

24 August 2017

Bond Street’s luxury profile has intensified over the last five years with the proportion of stores occupied by ‘super luxury’ retailers rising to 73.9% from 62.8%, according to international real estate advisor Savills.  Store openings on the street are expected to total 12 by year end based on known commitments, says the firm, in line with the previous 2012 peak.

Savills also highlights a squeeze in the presence of accessible luxury and aspirational mid market brands on Bond Street, which now account for 21.6% and 4.5% of stores respectively, compared to 25.7% and 11.5% in 2012.  A number of these have moved to more suitable locations such as Regent Street or concentrated on the area north of Brook Street, where 63% of brands are now accessible luxury.  The firm predicts this could increase to 75% following the completion of the Hanover Square development in 2018.

This retailer drift and an overall reduction in accessible luxury brands are driving Bond Street’s reputation as a ‘super luxury’ destination and an extension of its prime pitch, says Savills.  In terms of product mix, the street has seen relatively little change since 2012 and remains dominated by fashion and footwear, with 46.5% of stores currently falling into this category compared to 48.5% in 2012.  However, there has been an increase in monobrand watch boutiques and specialist bag and luggage brands to 10.1% and 3.1% respectively, reports the firm.

Marie Hickey, retail research director at Savills, comments: “The intensification of luxury retailers on Bond Street is apparent in the number of store openings under way, with ‘super luxury’ brands taking the place of others that are moving on to more suitable locations.  Four of the 12 store openings due to complete this year, including Alaïa and Officine Penerai, will be the brand’s first in London.  This highlights Bond Street’s role as a key destination of choice for retailers of this calibre.”

Savills also reports that European brands have strengthened their presence on Bond Street over the last five years, with the proportion of stores they account for rising to 58% from 49%.  This coincides with an intensification of brands originating from European luxury houses.  Conversely, the proportion of stores occupied by UK retailers has dipped from 39% to 32% and US retailers from 9% to 6% during that time.

Anthony Selwyn, head of Central London retail at Savills, adds: “Bond Street has witnessed terrific change over the last five years.  While headlines have often referred to rental growth, the more subtle and sustainable change has been the intensification of core luxury brand activity.  We predict aspirational and mid market brands will seek a presence towards the top end of Bond Street, close to Oxford Street, or more appropriate locations such as Regent Street instead.

“This movement also allows other locations to potentially capture in part a more luxury profile, including the traditional Mayfair locations, but also Oxford Street close to Selfridges and South Moulton Street.  These changes will strengthen Bond Street’s global profile and secure even more international investor appetite.  The rest of this year and 2018 will actually see more openings on the street than in previous years with leading brands from within LVMH Group, Alaïa, Tasaki, Panerai, Delvaux and Pomellato all committed to new stores.”

Prime Zone A rents on Bond Street are currently £2,250 compared to £1,100 in Q412.

 
 

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Key Contacts

Anthony Selwyn

Anthony Selwyn

Director
Central London Retail

Savills Margaret Street

+44 (0) 20 7758 3880

 

Marie Hickey

Marie Hickey

Director
Commercial Research

Savills Margaret Street

+44 (0) 20 3320 8288