New York City second to Hong Kong in world’s highest retail rents
Los Angeles — CBRE Group released research findings on Tuesday that showed Hong Kong continued to keep its top spot as the world’s most expensive global retail market, recording prime rents nearly 150% higher than New York City.
London ranked third, with prime rental rates 400% lower than Hong Kong’s.
CBRE’s quarterly survey, which tracks the top 10 most expensive prime global retail markets, revealed that strong demand from international retailers, coupled with a modest supply pipeline, has lead to record-high prime rental rates. Leading the pack, Hong Kong continues to rank in a rental class distinctly above its global peers, recording prime rental rates during first quarter 2013 of $4,328 per square foot per annum.
While markets such as Hong Kong, New York City, London and Paris did not record increases in prime rents this quarter, these cities have exhibited resilience due to international retailers continued longer-term strategic expansion strategies which feature a distinct preference for prime space in the best locations in these markets.
Ranking as the second most expensive global retail market, New York City ($2,970 per square foot) welcomed several new national and global retailers in 2012 that were attracted by the market’s strong international tourism features. The pipeline for new retail space in New York City is low. However, a significant amount of prime space is available along Fifth Avenue between 49th and 59th Streets.
Europe’s prime retail markets of London ($1,053 per square foot) and Paris ($1,050 per square foot) are holding steady, according to CBRE, largely due to scarcity of supply and correspondingly high rent levels.
The tight supply of prime space throughout the Asia Pacific region helped maintain rent levels in Sydney, Melbourne, Beijing and Tokyo. In Sydney ($1,018 per sq. ft), demand from international retailers (especially from the U.S.) is high with many new brands set to enter the market in 2013, according to the research.
Pacific markets gained prominence in the global retail rankings with Brisbane ($739 per square foot) and Melbourne ($851 per square foot) now ranking among the most expensive prime retail markets.
“Prime retail rents across the most expensive global markets have held firm against a backdrop of scarce supply and preference for prime space,” said Raymond Torto, CBRE’s global chief economist. “Despite subdued retail sales growth and strained consumer sentiments, international retailers remain focused on long-term growth strategies that have resulted in store expansions across many key global markets such as New York City, London and Moscow.”
Report: J.C. Penney stores, real estate worth $4.06 billion
New York — A Tuesday report by Reuters said that J.C. Penney Co.’s real estate holdings – including stores, DCs and headquarters – are worth a total of $4.06 billion.
An appraisal was conducted for Penney and subsequently disclosed in a presentation to potential lenders that was also filed with U.S. regulators.
Cushman & Wakefield’s appraisal valued the retailer’s 306 owned stores and 123 ground-leased stores at $3.3 billion, significantly under the $5.9 billion value previously estimated by Morgan Stanley. The DCs and home office together are valued at $762 million.
In April, J.C. Penney announced that Goldman Sachs was arranging a $1.75 billion loan to shore up its finances, backed by its real estate.
Men’s Wearhouse revamps e-commerce site
FREMONT, Calif. — Men’s Wearhouse has launched a revamped version of its e-commerce sitewhich features upgrades and personalized features that improve the overall online shopping experience, from browsing to buying.
Among the site’s new features are Lookmaker, which offers consumers style suggestions for wardrobe essentials; Guy’d Lines, which offers shoppers tips on style and Looks and Occasions, which pulls together looks created by the Men’s Wearhouse fashion director. The site also allows shoppers to filter searches by size, price, color and style.
Men’s Wearhouse plans to incorporate additional site functionality in the next six to eight months, including a new checkout experience, buy online and pick up in-store capabilities and international shipping.
Men’s Wearhouse president and CEO Doug Ewert said the revamped site was developed with an eye toward the increasing digital interest of the millennial shopper, and also the brand’s in-store sales strategy of helping the customer put together an entire look that is customized and comes with the expert services offered at Men’s Wearhouse.
“The new site elevates our company in the retail industry and reaffirms our commitment to technology and the importance of enriching the customer experience,” Ewert said. “At Men’s Wearhouse, we aim to offer world-class service to our customers, and our website is an extension of that commitment.”
Men’s Wearhouse operates 1,143 stores, and along with Moores and K&G stores, it carries a full selection of suits, sport coats, furnishings and accessories in exclusive and nonexclusive merchandise brands, while Men’s Wearhouse and Tux stores carries a limited selection. Most K&G stores also carry a full selection of women’s apparel. Additionally, Men’s Wearhouse operates a global corporate apparel and workwear group consisting of Twin Hill in the United States and Dimensions, Alexandra and Yaffy in the United Kingdom.