After ranking fourth in 2017, London became the most active city for luxury retailers last year, rising ahead of Paris, Tokyo and Singapore which had all ranked ahead of London in the previous year.
The firm notes that last year London accounted for 9.6% of all luxury store openings worldwide, more than any other city globally, highlighting the resilience of the luxury market to the existing economic uncertainty.
Savills research shows that the UK capital saw 33 luxury retailers open their doors last year, up 38% on 2017. While luxury fashion brands continued to dominate, accounting for 45% of store openings, this was down on 2017 as specialist accessory brands, focused on bags, footwear and eyewear, increased their share from 20% to 24%. Specialist jewellery and watch brands also continued to account for a sizeable number of store openings, at 24%.
This increase in openings across the capital follows the depreciation of sterling which resulted in increased international luxury retail spend in London in 2017, which in turn has gone on to support requirements and subsequent new openings in 2018.
Savills reports that globally, luxury brands opened 16% fewer new stores in 2018 compared with the previous year. Brands opened new stores in 85 cities last year, down from 118 in 2017, suggesting that brands are refocusing on core, strategic and often underrepresented markets.
Behind London, Bangkok ranked second with a 6.7% share of openings, driven solely by the opening of ICONSIAM mall. Dubai and Hong Kong came joint third, with Dubai also being supported by increased store supply with the extension of Fashion Avenue. Paris and New York took the fourth and fifth spots.
Marie Hickey, retail research director at Savills, comments: “In spite of the headwinds facing UK retail, the London luxury market is looking not only resilient but is also offering attractive opportunities for those brands who want to enter the market, as well as those looking to improve their physical presence with more high profile, experiential spaces. With a 38% increase in luxury store openings last year, the city became the most active destination globally for high end brands, up from joint fourth in 2017.”
Anthony Selwyn, head of London and international retail at Savills, comments: “Last year we saw the big luxury brands retrench to the core cities and we expect these global destinations to remain the key focus for luxury brands wanting to expand or improve their physical profile in 2019. For the UK market, it’s great to see London leading the way, and with the core cities predicted to be the main areas of interest for brands this year, the future looks positive the capital.”