2024-12-20-莱坊-Central_London_Retail_Market_Dashboard_Q3_2024_2页_964kb

Central London Retail Dashboard Summary - Q3 2024

Core Content Overview

This document provides a quarterly update on the performance and trends of the Central London retail market for Q3 2024. It highlights consumer spending, footfall, rental and capital growth, investment activity, and key lettings. The report also includes market sentiment and concerns related to upcoming policy changes.

Key Takeaways

• Consumer Spending:

  • West End consumer spend increased by +1.0% in July and +1.5% in August, outpacing footfall (+0.4% / +0.5%).
  • September saw a slight dip in spending (-1.1%), but average transaction values rose by +3.5%.
  • International spending was significantly stronger than domestic, with +4.8% and +6.0% in July and August respectively, compared to domestic declines of -1.2% and -0.9%.
  • Domestic spending still constitutes 67% of total spend, with concerns over the loss of tax-free shopping benefits.

• Footfall Trends:

  • Footfall showed modest growth in July and August (+0.4% / +0.5%), but dropped sharply in September (-2.4%).

• Lettings Activity:

  • Total lettings amounted to approximately 117,000 sq ft.
  • Key activity was observed in Covent Garden and Oxford Street, with notable tenants including Space NK, Alo Yoga, Axel Arigato, Activate - We do Play, Keikoo, Caffe Concerto, Dune, and others.
  • Major lettings included:
    • 118 New Bond Street (3,860 sq ft) to Clive Christian Perfume
    • 162 Oxford Street (2,693 sq ft) to Dune
    • 124 Regent Street (1,370 sq ft) to Swarovski
    • 67-69 & 79 Knightsbridge (4,700 sq ft) to Les100Ciels
    • 14-16 Neal Street – Covent Garden (4,676 sq ft) to Onitsuka Tiger
    • 99-103 Long Acre – Covent Garden (6,565 sq ft) to MANGO
    • 12 The Piazza - Covent Garden (4,000 sq ft) to Charlotte Tilbury

• Rental & Capital Growth:

  • Central London rental growth accelerated to +0.8% quarter-on-quarter, driven by the West End at +1.2%.
  • Annual capital value growth for 2024 is projected at +2.1%, outperforming the wider UK retail market (+1.3%) and the West End (+2.3%) outperforming the City/Mid-Town (+1.5%).

• Investment Activity:

  • Q3 investment volumes were relatively quiet at £88.5m, compared to a strong Q2 of £434m.
  • Year-to-date investment volumes have reached £726m, surpassing the five-year average of £546m.
  • Notable transactions include:
    • JP Morgan's £71m acquisition of 291 Oxford St / 2 Harewood Place, leased to McDonald's and EE.
    • M&G's £285m loan to Trophaeum AM for a portfolio including a Gucci store at 144/146 New Bond St.

• Market Sentiment:

  • Overall sentiment and occupational metrics have improved, with a resurgence in retail and leisure openings.
  • Concerns remain about the Autumn Budget, which is expected to increase cost pressures on retailers.
  • A potential unfavourable multiplier on business rates for properties with a rateable value over £500k from 2026 is a key concern for West End occupiers.

Supporting Data

• Prime Zone A Rents: Data on rental growth by sub-market.
• Lettings by Sub-market: Information on rental and capital value growth, and prime yields.
• Investment Volumes: Overview of investment activity in the quarter.
• Vacancy Rates: Data on vacancy percentages from PMA and Knight Frank.
• West End Footfall: YoY % change for July, August, and September.

Contact Information

For further inquiries, contact the following professionals at Knight Frank:

• Jonathan Eastwood
  Head of Retail Agency
  +44 208 682 7769
  Jonathan.Eastwood@knightfrank.com

• Josh Braid
  Partner, Central London & International Agency
  +44 7793 082 342
  Josh.Braid@knightfrank.com

• Ollie Green
  Partner, Central London
  Retail & International Agency
  +44 7890 989 836
  Oliver.Green@knightfrank.com

• Rob Hargreaves
  Partner, Central London & International Agency
  +44 7977 998 832
  Rob.Hargreaves@knightfrank.com

• Ryan Mak
  Senior Surveyor, Retail & Leisure Agency
  +44 207 861733
  Ryan.Mak@knightfrank.com

• Andrew Thatcher
  Partner, Lease Advisory
  +44 7793 273 532
  Andrew.Thatcher@knightfrank.com

• Esther Dowd
  Graduate, Central London & International Agency
  +44 208 176 9802
  Esther.Dowd@knightfrank.com

• Rohit Venkateshan
  Graduate, Central London & International Agency
  +44 207 034 4284
  Rohit.Venkateshan@knightfrank.com

• Stephen Springham
  Partner, Head of Retail Research
  +44 7468 727 557
  Stephen.Springham@knightfrank.com

• Emma Barnstable
  Associate, Commercial Research
  +44 20 8106 1385
  Emma.Barnstable@knightfrank.com

Disclaimer

This document is for general information only and should not be relied upon in any way. Knight Frank LLP does not accept any responsibility or liability for any loss or damage resulting from its use. The content does not represent the views of Knight Frank LLP on any specific property or project.