New York’s Fifth Avenue Retains its Top Ranking as the World’s Most Expensive Retail Destination

By: Cushman & Wakefield via Business Wire

November 20, 2023 at 17:00 PM EST

Retail Rents in Prime Global Locations Continue to Recover Showing Resiliency

Cushman & Wakefield (NYSE: CWK) today released its 33rd edition of Main Streets Across the World, examining retail rental rates in prime locations in cities around the world.

New York’s Fifth Avenue retains its top ranking as the world’s most expensive retail destination, despite recording flat rental growth year-over-year (YOY).
Milan’s Via Montenapoleone jumped a spot into second, displacing Hong Kong’s Tsim Sha Tsui, which placed third in 2023.
New Bond Street in London and the Avenues des Champs-Élysées in Paris retained fourth and fifth positions, respectively.
The biggest mover was Istiklal Street in Istanbul, up from 31st to 20th position, as rampant inflation caused rents to more than double over the past year.

The report focuses on headline rents in best-in-class urban locations across the world which, in many cases, are linked to the luxury sector. The rental values in this specific segment have been relatively immune to additional discounts, incentive packages or shared risk rental models that have become more prominent in the wider retail markets globally.

“The retail sector has continued to face issues head on while demonstrating its resiliency. The near-term outlook for the retail sector remains cautious, but at the same time is nuanced between sub-sectors and geographical locations,” said Barrie Scardina, Head of Americas Retail. “At the macro level, the focus is on the strength of consumer spending. As central banks have undertaken one of the most aggressive interest rate hiking cycles in decades, consumers have shifted spending patterns and are reigning in non-discretionary expenditure.”

As the world continues to emerge from the impacts of the global pandemic, prime retail destinations similarly have continued their rebound, recording mostly positive rental growth over the past year.

Rents across global prime retail destinations continued their ongoing recovery, increasing on average 4.8% in local currency terms over the past year. The strongest growth was recorded in Asia Pacific, which averaged 5.9%, with Europe at 4.2% and the Americas at 5.2%.
Notwithstanding comparatively strong growth over the past year, in most instances, the increase in rents did not match levels of peak inflation.
Furthermore, almost 60% of markets globally remain below pre-pandemic rental levels. This is most evident in Europe where 70% of markets are below pre-pandemic rents. In contrast, in the U.S., only 31% are below pre-pandemic levels; 69% are above.

Global Ranking 2023	Global Ranking 2022	Market	City	Location	Rent (USD/sq.ft/yr)	Rent (EUR/sqm/yr)	Pre-pandemic to present (LCY)	YOY (LCY)
1	1	U.S.	New York City	Upper 5th Avenue (49th to 60th Sts)	$2,000	€20,384	14%	0%
2	3	Italy	Milan	Via Montenapoleone	$1,766	€18,000	31%	20%
3	2	Greater China	Hong Kong	Tsim Sha Tsui (main street shops)	$1,493	€15,219	-39%	4%
4	4	United Kingdom	London	New Bond Street	$1,462	€14,905	-11%	0%
5	5	France	Paris	Avenues des Champs-Élysées	$1,120	€11,414	-18%	0%
6	6	Japan	Tokyo	Ginza	$912	€9,299	0%	0%
7	7	Switzerland	Zurich	Bahnhofstrasse	$907	€9,243	-2%	1%
8	8	Australia	Sydney	Pitt Street Mall	$747	€7,612	-24%	0%
9	9	South Korea	Seoul	Myeongdong	$642	€6,542	-19%	5%
10	11	Austria	Vienna	Kohlmarkt	$506	€5,160	6%	2%

Note: Full table of global rankings available here.

“While mentions of the pandemic have largely slipped from the headlines, the world continues to manage its economic aftershocks. Supply chain bottlenecks along with fiscal and monetary stimulus have now given way to a period of high, although easing, inflation, rising interest rates and slowing economic growth. The macroeconomic trends which had become more evident in 2022 have continued through this year and will likely continue into the next,” said Scardina.

About Cushman & Wakefield

Cushman & Wakefield (NYSE: CWK) is a leading global commercial real estate services firm for property owners and occupiers with approximately 52,000 employees in approximately 400 offices and 60 countries. In 2022, the firm reported revenue of $10.1 billion across its core services of property, facilities and project management, leasing, capital markets, and valuation and other services. It also receives numerous industry and business accolades for its award-winning culture and commitment to Diversity, Equity and Inclusion (DEI), Environmental, Social and Governance (ESG) and more. For additional information, visit www.cushmanwakefield.com.