Tsim Sha Tsui Ranked the World’s Fourth Most Expensive Shopping Street

• Hong Kong’s Tsim Sha Tsui maintains a high global ranking position as the world’s 4th most expensive retail street; the area continued to top the APAC ranking as region’s the most expensive retail destination
• Via Montenapoleone becomes the first European shopping street to top the rankings, overtaking New York’s Upper 5^th Avenue
• Rents increased in 79 of the 138 locations tracked, declining in just 19, with global average rental increase of 4.4%

HONG KONG SAR 21 November 2024 – Milan’s Via Montenapoleone, where rents have risen by nearly a third in the past two years, has overtaken New York’s Upper 5th Avenue to be crowned the world’s most expensive retail destination, according to Cushman & Wakefield (NYSE: CWK).

It is the first time a European street has topped the global rankings in the firm’s flagship retail report ‘Main Streets Across the World’. Now in its 34th edition, the report focuses on headline rents in 138 best-in-class urban retail locations across the globe, many of which are linked to the luxury sector, utilising Cushman & Wakefield’s proprietary data. The global index ranks the most expensive destination in each market.

Synonymous with fashion and luxury, Via Montenapoleone has steadily climbed the rankings in recent years, reaching second for the first time in 2023. Rents rose 11% to US$2,047 per square foot (psf) in the past 12 months, whereas rents on Upper 5th Avenue (US$2,000) remained flat for a second consecutive year. Alongside continuing strong retailer demand amid constrained supply, Via Montenapoleone also benefitted from the euro’s appreciation against the U.S. dollar.

London’s New Bond Street (US$1,762) leapfrogged Hong Kong’s Tsim Sha Tsui to take third, despite the latter’s positive rental growth. With 10% year-on-year (YOY) rental growth, Paris’s Avenue des Champs Élysées retained fifth position, although Tokyo’s Ginza district narrowed the gap with a 25% YOY increase.

Main Streets Across the World – Global Ranking by Market 2024

Source: Cushman & Wakefield

Competitive tension for limited space saw YOY rental growth recorded in 57% (79) of the 138 locations tracked, declines in just 14% (19), with the remainder 29% (40) flat. This resulted in a global average rental increase of 4.4%. Americas was the strongest performer regionally at 8.5%, driven by rental growth of almost 11% in the U.S. – more than double the 5.2% recorded last year – followed by Europe and Asia Pacific at 3.5% and 3.1% respectively. Rents across the 138 locations are now on average nearly 6% above pre-pandemic levels.

Global Outlook

Prime retail destinations have mostly successfully weathered the storm precipitated by interest rate hikes to curb inflation in 2022 and 2023, which led to a rapid increase in the cost of living, weak consumer sentiment and sluggish economic growth. Retail now stands to benefit from the gathering pace of interest rate cuts, economic recovery, easing cost of living pressures, and real wage increases.

Report author Dr. Dominic Brown, Cushman & Wakefield’s Head of International Research, said: “Increased discretionary spending among consumers will further boost the performance of prime retail destinations. How quickly and strongly that feeds through into rental growth at a market level will vary due to local nuances and market dynamics. Growth at a global and regional level was led by the U.S. this year, but every region had really strong double-digit growth in certain markets – truly exceptional in some cases – and others where rents have slipped for one reason or another. However, performance at the very top end underlines that the strength of ‘prime’ continues to rise and we expect that to continue as conditions improve.”

Asia Pacific

Hong Kong continued to feature strongly on the global rankings, coming in at number 4 this year. John Siu, Managing Director, Hong Kong at Cushman & Wakefield, said, “We are pleased to see Hong Kong maintaining its position as one of the top retail destinations globally. This achievement underscores the resilience and attractiveness of Hong Kong’s retail market, even amidst a challenging business landscape. Looking ahead, we expect to see more leasing activities and an increasing importance of Chinese mainland brands and retailers entering the Hong Kong retail market, using it as a stepping-stone to promote their brands on the international stage. The ongoing recovery in tourist arrivals and the easing of economic headwinds are also expected to further support tourists’ spending sentiment and, consequently, the retail performance in the city’s core locations. As the retail market continues to evolve, we believe landlords will focus on customer experience and innovation to attract more new retailers and international brands.”

Rents closely reflected wider macroeconomic performance within the region. India has been the strongest major economy in the world this year, and Indiranagar 100 Feet Road in Bengaluru leads the region’s rental growth at 32% YOY. Rental growth across 16 tracked Indian locations averaged a 9% increase YOY. Southeast Asian economies also performed strongly, driven in part by robust domestic consumption, which has led to rental growth of up to 7% in Jakarta and between 1% to 5% elsewhere in the sub-region. Japan surprised by defying weak growth conditions. After four stable years, rents moved higher in 2024, led by Ginza at 25% YOY, while Osaka’s Midosuji recorded 9% growth.

Asia Pacific Ranking by Market 2024

Source: Cushman & Wakefield