This, our fifth edition, explores global new store openings with a focus on identifying the most attractive opportunities for store expansion over the next 12–18 months. The resilience of the luxury market is evidenced in the relative health of luxury retail globally; emerging pitches and new markets may present some of the most interesting future opportunities
Welcome to the Savills Global Luxury Retail 2023 Outlook
It is incredible to think that this is the fifth edition of our global luxury retail report and what five years it has been. What the pandemic has demonstrated is the resilience of luxury retailing but in particular the strength of physical luxury retailing and its increasing importance in a digital age. In the immediate aftermath of the pandemic, the focus from a store perspective was to get closer to luxury consumers; this trend continues but with the resumption of international travel key destination cities have also moved back up the agenda.
Opportunities generated by the pandemic, such as increased availability and reduced rents in some markets, did help to facilitate increased store activity, namely in London and New York. However, the resilience of luxury spend in more domestic-focused markets and those with very tight levels of supply have actually elevated rents above pre-covid levels and further constrained availability.
With those post-pandemic opportunities now almost absent across the majority of primary luxury markets and supply coming under further downward pressure, the question is, where are the best store opportunities in 2023 and beyond?
Marie Hickey, Director, Commercial Research
We look to try and identify these future opportunities for new stores and potential relocations. On-the-ground experts and our market knowledge highlights that opportunities still exist in those primary luxury global markets beyond the core luxury pitch if brands are willing to be ‘pioneers’. And in some cases, these emerging pitches will be supported by wider redevelopment initiatives and the entrance of new global luxury hotels, bringing new wealthy consumers into their orbit.
What is clear looking at the geography of store openings over the last 12-18 months, brands have already become increasingly open to a wider variety of markets from global destination cities, through to domestic-focused and leisure resort markets. A trend we expect will continue through to 2024. But, with availability becoming increasingly constrained across the majority of markets, 2023 may prove to be the apt time to secure new opportunities and in some cases still benefit from attractive post-pandemic leasing terms.
With our unrivalled knowledge of brand requirements and new entrants into the market, we are best placed to advise and provide in-depth insight into the key established and emerging markets. This is further bolstered through thought leadership and market intelligence from our specialist luxury retail research team. In recent years we have worked with a range of clients within the luxury retail sector and advised on a number of high-profile transactions. Our unique global offering positions us to simultaneously advise on locations, values and key property criteria throughout all major cities across the globe.
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