Hong Kong has maintained its position as the most popular destination for luxury retailers, attracting 84% of the luxury brands covered in the 2011 edition of How Global is the Business of Retail? by global real estate adviser CB Richard Ellis (CBRE).
CBRE’s annual survey – now in its fourth year – mapped the global footprint of 323 of the world’s top retailers across more than 200 cities to identify trends in global retail expansion at national and local levels. “Hong Kong’s ranking reflects the continuing love affair that local residents and increasingly visitors from mainland China have with luxury fashion. Particularly evident is the change in retail mix in Hong Kong’s leading shopping malls and shopping precincts toward luxury brand retailers,” said Dr Nick Axford, Head of Asia Pacific Research for CBRE.
Gone are the days when luxury meant owning a colored TV set or dining out at a western fast food eatery such as McDonalds; Chinese consumers are now eyeing high-end luxury goods with ever more money in their once flat pockets.
China’s rapid evolution from a basic emerging market to a sophisticated economic powerhouse is ready to see the country become the world’s largest luxury goods market over the next decade.
CLSA Asia-Pacific Markets, majority owned by France’s Credit Agricole SA, expects China to account for as much as 44 percent of global luxury sales by 2020, up from the current 15 percent.
CLSA also predicted that overall consumption in China will rise by 11 percent annually over the next five years, while sales of luxury goods will grow more than twice as quickly, by 25 percent a year.
Across all retail sectors Dubai climbed CBRE’s rankings to share the top position as the most targeted retail destination with London. Dubai and London are followed in the top retail city rankings by the established markets of New York (44.3% of international retailers), Paris (43.6%), and Hong Kong (40.6%), which clearly still hold considerable global pulling power.
Singapore, Tokyo an Beijing also feature in the top 10, confirming that Asia continues to be a key target for luxury brands, with many retailers opening in multiple locations and developing flagship stores to market their brand.
Asian cities featured strongly among the Top 20 cities for international retailers, with five in the ranking – Hong Kong, Singapore, Beijing, Shanghai and Tokyo. Attracting more than half (56%) of all international retail brands surveyed, Dubai now equals London as the most popular retail city in the world. With 1.2 million square metres of retail space having come on to the market since 2006, a wealthy consumer base, and very little competition from local retailers Dubai’s stature as a key destination for international retailers has grown quickly. A further trend has been an influx of US-based retailers in the last 18 months.