The 2014 report, which tracks retailer’s movements in 2013, found that the overall footprint of global retailers at country level grew by 1.7%. More than half of retailers (51%) are now present in all three major global regions, The Americas, Europe Middle East and Africa (EMEA) and Asia Pacific, a slight increase on the previous year.
Retailers focused on more mature markets in 2013, with 18 of the top target cities considered mature markets compared with only 14 the previous year. 83% of the survey cities saw at least one new entrant throughout the year (compared with 81% the year before); with the top target markets seeing a 28% rise in new entrants.
The number of new entrants at city level was up by 26% year-on-year, with an increasing number of retailers crossing borders to grow their businesses. Paris has risen in popularity among the cities most attractive to retailers welcoming 50 new entrants over the year, including 10 new Luxury & Business Fashion brands. Paris benefitted from three new shopping centers in 2013, but it was the prime high street locations that attracted most global brands. Competition on these high streets between luxury brands is fierce due to surging demand from tourists, especially from China.
France also topped the table of the hottest countries ahead of Japan and Hong Kong. France has seen a renewed confidence in the market. Paris was the main point of entry for many retailers and has seen rents increase to decade highs due to significant interest from global retailers for the limited amount of available prime space. Paris was not the only target market; retailers also chose nine other French cities for their first store.
Tokyo is second as the most attractive city for global retailers, seeing double the number of new entrants during 2013 (48) than it did in 2012, reflecting renewed confidence in the economic prospects of Japan. Half of all new entrants (24) came from the U.S., while a further 18 were from Europe. Hong Kong and Abu Dhabi were the third and fourth ‘hottest’ markets with 43 and 42 new entrants respectively.
London is the home of more international brands than any other city, yet it still attracted 31 new market entrants last year. Other cities in the top ten included Beijing, Moscow, Shanghai, Frankfurt, Taipei and Singapore.
Jose Luis Martin, EMEA Senior Director of Cross Border retail, CBRE, commented:
“The improving economic prospects in Western Europe and North America is leading global retailers to refocus their expansion plans on mature markets and the world’s major retail destinations, with Paris, Tokyo, London and Berlin the top targets. Retailers have also turned their attention to recovering European markets and Asian and South American cities where they are still under represented.
“Global shopping center development is also at an all-time high and is providing the opportunity for retailers to enter new markets, particularly in Asia, Latin America and Eastern Europe. Owners are putting sizable resources into revamping, extending and freshening up their existing centers and securing major international brands is a key part of this strategy.
“The growth of the online environment has also elevated the importance of the brand – not just among luxury retailers, but across the retail spectrum with consumers seeking out aspirational brands as well as high street and value offerings, and this is driving demand for new stores.”
Retailers from the Americas are by far the most global, with 80% present in all three regions, compared with 48% of European retailers and 25% of Asia Pacific retailers. The maturity of the American market has encouraged retailers to cross borders and to extend their global reach in order to grow their companies. U.S. retailers expanding into EMEA represented 40% of cross-border movements by American retailers, 35% were entries into Asia, and only 18% were entries into other countries in the Americas region.
Naveen Jaggi, Senior Managing Director, Retail Services, CBRE, commented:
“The maturity and density of the American market is encouraging retailers to look outside their home borders in order to seek growth. Retailers from the U.S. were by far the most active in their expansion with at least one American retailer entering 45 of the 61 countries surveyed.
“London remains the top market for American retailers that are looking to move out of their home region. The proportion of American retailers with a presence in London has risen 4.2% since 2012 and two thirds of retailers based in the Americas are now present in London.”
The Luxury and Business Fashion sector accounted for the highest proportion (24%) of new market entrants globally. One third (32%) of all new entrants to the Americas were from this sector which is a direct reflection of the improved outlook for U.S. consumption. Luxury and Business Fashion retailers also proved to be very active in EMEA accounting for 24% of new entrants.
Notes to editors:
CBRE’s annual survey, now in its seventh year, maps the global footprint of 334 of the world’s leading retailers across more than 189 cities, tracking cross-border retailer movements. It also looks at the markets retailers have targeted in 2013 and provides a definitive benchmark against which to measure future changes in the global retail environment through a global ranking of countries and cities which have been most successful in attracting leading international retailers.
About CBRE Group, Inc.
CBRE Group, Inc. (NYSE:CBG), a Fortune 500 and S&P 500 company headquartered in Los Angeles, is the world’s largest commercial real estate services and investment firm (in terms of 2013 revenue). The Company has approximately 44,000 employees (excluding affiliates), and serves real estate owners, investors and occupiers through approximately 350 offices (excluding affiliates) worldwide. CBRE offers strategic advice and execution for property sales and leasing; corporate services; property, facilities and project management; mortgage banking; appraisal and valuation; development services; investment management; and research and consulting. Please visit our website at www.cbre.com