Cushman & Wakefield‘s 33rd edition of “Main Streets Across the World” report reveals that Singapore continues to hold its position as the 12th most expensive retail destination globally. In a year marked by economic adjustments and a resilient retail sector, Singapore’s prime retail location, Orchard Road, has shown remarkable stability.
Singapore’s retail landscape
In 2022, Orchard Road was ranked 12th in the global ranking at USD404/sq ft/yr. Demonstrating consistent performance, it maintained its position in 2023, with a notable increase to USD431/sq ft/yr. This steadfast ranking highlights Singapore’s ongoing appeal as a prime retail destination amidst global challenges.
Global retail trends
The report underscores the resilience of prime retail rents in key global locations, particularly those linked to the luxury sector. Despite broader market trends towards discounts and incentive packages, prime retail rents have largely resisted these shifts.
| Global Ranking 2023 | Global Ranking 2022 | Location (Market, City, Address) | 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% |
| 11 | 10 | Mainland China, Shanghai, West Nanjing Road | $496 | €5,060 | -10% | 5% |
| 12 | 12 | Singapore, Singapore, Orchard Road | $431 | €4,395 | 2% | 2% |
Table and data from Cushman & Wakefield. Global prime retail rankings 2023.
Dr. Dominic Brown, Head of International Research for Asia Pacific at Cushman & Wakefield, emphasised the sector’s resilience: “Retail has continued its path to recovery despite post-pandemic challenges and central banks’ responses to the current inflationary cycle. Although economic growth forecasts have been trimmed, and consumers are reigning in discretionary spending, the retail sector remains robust.”
Global and regional rental changes
Globally, rents rose by an average of 4.8% year-over-year. The Asia Pacific region recorded the strongest growth at 5.3%, followed by the Americas at 5.2% and Europe at 4.2%. However, global rental levels remain below pre-pandemic levels in 55% of markets, with Europe lagging the most.
Read more: HDB rental prices and latest rental transactions in 2023
Global prime retail rankings
The report features a comprehensive global ranking of retail destinations. New York’s Fifth Avenue retains the top spot, while Milan’s Via Montenapoleone and Hong Kong’s Tsim Sha Tsui follow. Singapore’s consistent performance keeps it in a notable 12th position.
Spotlight on APAC
In the Asia Pacific, Hong Kong, and Tokyo dominate the region’s most expensive streets. Singapore’s Orchard Road has moved up from 14th to 13th position in the APAC ranking, showing a positive shift in its standing among Asia Pacific cities for retail rental rates.
| APAC Ranking 2023 | APAC Ranking 2022 | Location (Market, City, Address) | Rent (USD/sq.ft/yr) | Rent (EUR/sqm/yr) | Pre-pandemic to present (LCY) | YOY (LCY) |
|---|---|---|---|---|---|---|
| 1 | 1 | Greater China, Hong Kong, Tsim Sha Tsui (main street shops) | $1,493 | €15,219 | -39% | 4% |
| 2 | 2 | Greater China, Hong Kong, Causeway Bay (main street shops) | $1,374 | €14,007 | -46% | 6% |
| 3 | 3 | Japan, Tokyo, Ginza | $912 | €9,299 | 0% | 0% |
| 4 | 4 | Japan, Tokyo, Omotesando | $798 | €8,137 | 17% | 9% |
| 5 | 5 | Australia, Sydney, Pitt Street Mall | $747 | €7,612 | -24% | 0% |
| 6 | 11 | Japan, Osaka, Midosuji | $730 | €7,440 | 7% | 60% |
| 7 | 6 | Japan, Tokyo, Shinjuku | $684 | €6,975 | -6% | 0% |
| 8 | 7 | Greater China, Hong Kong, Central (main street shops) | $673 | €6,863 | -40% | 9% |
| 9 | 8 | South Korea, Seoul, Myeongdong | $642 | €6,542 | -19% | 5% |
| 10 | 9 | South Korea, Seoul, Gangnam Station | $572 | €5,825 | -22% | 2% |
| 11 | 10 | Greater China, Shanghai, West Nanjing Road | $496 | €5,060 | -10% | 5% |
| 12 | 12 | Greater China, Nanjing, Xinjiekou | $458 | €4,671 | 3% | 3% |
| 13 | 14 | Singapore, Singapore, Orchard Road | $431 | €4,395 | 2% | 2% |
Table and data from Cushman & Wakefield. Asia Pacific prime retail rankings 2023.
Luxury sector dynamics
Over 95% of luxury brands reported profit growth in 2022, continuing into early 2023. However, the luxury sector is experiencing a slowdown as higher interest rates normalise the customer base expanded during the pandemic.
Conclusion
Singapore’s stable position in the global retail market, as detailed in Cushman & Wakefield’s report, underscores its resilience and appeal as a premier retail destination. With a balanced outlook and a recovery trajectory, Singapore’s retail sector is poised for sustained relevance in the global retail landscape.
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