HK Remains World’s Most Expensive Retail Market

10-Dec-2014 Intellasia | World Property Journal | 8:20 AM Print This Post

According to new research from CBRE Group,Hong Kong,New York,Paris,LondonandTokyoretained their positions as the world’s most expensive high-street retail destinations in Q3 2014.

CBRE’s quarterly ranking of the world’s prime global retail markets saw little change in Q3 2014, with global and hot-growth markets continuing to lead the list. Retailers across all markets continue to target high-end shopping areas and international tourists.

“Even with the somewhat gloomy economic headlines, consumer demand is reasonably firm in most markets,” said Richard Barkham, Global Chief Economist, CBRE. “We can expect to see a continuation of the post-crisis pattern of periods of optimism followed by periods of pessimism. TheAmericaswill see stronger growth than the Eurozone, as the latter has been constrained by restructuring in the banking sector as well as overly tight fiscal and monetary policy. Asia Pacific will record slightly lower growth in 2014 over 2013, but is still expected to outpace the other two regions by a considerable margin.”

Hong Kong (US$4,327 per sq. ft. per annum) maintained a wide lead over the number-two market,New York(US$3,570 per sq. ft. per annum)-where prime rent alongFifth Avenueis at record levels. Rents inHong Kongremained stable compared to Q2 2014.

The “Occupy Central” protest, which began late in the third quarter, has not yet materially impacted retail rents inHong Kong,” said Henry Chin, Head of Research, Asia Pacific, CBRE. “We did see lower shopper footfall in affected areas in October; however, the Christmas shopping season will provide some support to retail sales in the final quarter.”

A large rental spread also exists betweenNew Yorkand the two leading European markets:Paris(US$1,331per sq. ft. per annum) andLondon(US$1,328 per sq. ft. per annum). The gap between the top four markets and the rest of the top 10 widens significantly.

While the top four cities continue to hold their leading positions, there was some movement lower in the top 10 rankings. Rents rose inTokyo(US$1,076 per sq. ft. per annum), and fell inZurich($895 per sq. ft. per annum) andSydney(US$730 per sq. ft. per annum), resulting in the cities changing positions this quarter.

In Q3 2014, Tokyo continued to lead rental growth in Asia Pacific, with the continued lack of space in major high-street retail locations pushing up retail rents 7.7 percent quarter-over-quarter. Strong rental growth was also recorded in a number of emerging markets in the region, particularly inIndiaandVietnam, reflecting the recent resumption of structural economic reforms following the general lack of progress over the past few years. Highlights included a strong 5.9 percent quarter-over-quarter rental growth inHCMCityand a 4.0 percent quarter-over-quarter rental growth in Mumbai.

Retailer demand for prime locations in major cities across EMEA remained firm, but rental growth has tailed off, leaving most markets flat in Q3 2014.Hamburg(up 6.5 percent quarter-over-quarter) andMunich(up 5.6 percent quarter-over-quarter) were among the few markets to record growth, reflecting the fact that, despite the recent economic headlines, domestic consumption inGermanyremains firm.

In theUS, four of the 12 prime retail corridors tracked by CBRE Research saw quarter-over-quarter increases in prime rents during Q3 2014. prime asking rents alongRodeo DriveinLos Angeles(US$640 per sq. ft. per annum) continue to be the highest in theUSoutside ofManhattan, and are expected to record further increases over the remainder of 2014, as there continues to be a lack of available space.Miami(up 3.2 percent quarter-over-quarter),Washington,D.C.(up 2.2 percent quarter-over-quarter), andNew York(up 2.0 percent quarter-over-quarter) also reported increasing in prime asking rents in Q3 2014. InCanada, high-street rents were unchanged inMontreal,VancouverandToronto, and have remained at their current level since Q4 2013.

>T�&n/HЅ�{�ry-region> at any one time could theoretically provide cover for covert activity, such as fomenting unrest, at a time whenTaiwan’s own military is shrinking.


Finally, the PLA and other Chinese armed forces are now more than a match for their Taiwanese counterparts. Budget limitations have meant thatTaiwansimply has not been able to matchChina’s military buildup. As a consequence,Beijingenjoys a widening gap in both quantity and quality overTaipeiin all major weapon systems. Asymmetrical warfare could be a solution forTaiwan, but the Ma administration has slashed the budgets for several critical projects, such as mid-range cruise missiles. In addition, with poor internal management, espionage is on the rise, further weakeningTaiwan’s defense. Although theUSmilitary presence in the Taiwan Strait has been a key factor since 1950,China’s anti-access/area denial (A2AD) strategy and capabilities could effectively constrain operations by theUSAt any rate,Washingtonmay decide it is unwilling to risk a major conflict withChina.

In short, an election victory by Taiwanese opposition parties may no longer be able to freeTaiwanfrom the influence of the mainland. Indeed, both opposition leaders and ordinary voters may well find themselves facing serious challenges in the near future.


Category: Hong Kong

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