In the global landscape of prime retail destinations, New York’s Fifth Avenue maintains its unparalleled status as the most expensive locale, a distinction unaffected by stagnant rental growth in the past year, as indicated by a recent report from Cushman & Wakefield. The 33rd edition of Main Streets Across the World chronicles retail rental rates in key city locations worldwide.
This preeminence of Fifth Avenue comes as no surprise to industry experts. Lisa Christianson, President of Christianson & Company Commercial Real Estate Services/CORFAC International, emphasizes the avenue’s appeal to the affluent, drawing in some of the world’s wealthiest residents and tourists. According to Christianson, top-tier luxury brands strategically choose Fifth Avenue for sales and the exposure it affords. The exclusivity of this expensive real estate is a natural deterrent to businesses lacking financial robustness, placing retailers with a Fifth Avenue address in a distinct class.
Mark Sigal, CEO of Datex Property Solutions, attributes the enduring strength of New York’s Fifth Avenue to multiple factors. He underscores the global significance of Fifth Avenue as a flagship location, particularly for brands with a luxury focus. Sigal notes that the luxury and ultra-luxury segments have demonstrated resilience despite economic turbulence. With historic lows in retail vacancies and the early signs of a rebound in the New York Office market due to the accelerating “return to office” trend, Fifth Avenue stands out as a rising force, surpassing other high-end retail corridors. The timeless mantra in retail discussions, “location, location, location,” aptly captures the essence of Fifth Avenue’s supremacy.
While Fifth Avenue reigns supreme, it’s noteworthy that other New York neighborhoods are also attracting high-end retail, albeit at presumably lower rents. Ariel Schuster, Newmark’s Vice Chairman focusing on the retail market, reports two significant store openings in the past week alone—Cartier at 102 Greene Street in Soho and Crate & Barrel at 881 Broadway in the heart of the Flatiron District.
Cushman & Wakefield’s report unveils a shift in the global ranking, with Milan’s Via Montenapoleone ascending to second place, displacing Hong Kong’s Tsim Sha Tsui, which now holds the third position in 2023. New Bond Street in London and the Avenue des Champs-Élysées in Paris maintain their fourth and fifth positions, respectively.
The most noteworthy ascent is observed in Istanbul, where Istiklal Street surged from 31st to 20th position, driven by rampant inflation that led to rents more than doubling over the past year.