You only have to look at the battle rumbling on between the tailors of Savile Row and US fashion retailer Abercrombie and Fitch, over the latter’s plans to open up a kids store on the infamous street to see that the arrival of international retailers is often a contentious issue.
That particular battle may be over the character of the street, but for others in central London the arrival of international retail power-houses means higher rents, and in some cases losing out on the best locations.
This year London indie Browns recently found itself on the back-foot after Brazilian jeweller H Stern paid a reported a $1m premium for its Sloane Street property, forcing the retailer to look to a less desirable spot on the street, while in March of this year it’s Labels for Less store moved from its home of 10 years in South Molton Street to a more affordable location in Marylebone Lane. The criticism levelled at international entrants to the UK market by home-grown businesses such as Browns is that by paying premiums they are setting the rent bench-marks that are driving up prices, and in some cases, driving them out.
While there is no doubt that the arrival of the likes of US brands Victoria’s Secret and young fashion chain Forever 21, and Chinese brands such as Bosideng, is having an impact, there are potential benefits too.
Arguably, stores such as Abercrombie or Hollister on Regent Street, or even non-fashion retailers such as Apple, attract massive crowds, the overflow of which could be seen to be of benefit to those retailers nearby. So long as they can afford to be there in the first place.
For now, this remains an issue for central London, and places like the Trafford Centre and oil-affluent Aberdeen. Longer-term it’ll be interesting to see if these large international retailers spread their wings beyond the confines of the capital.
For more on this issue, read Drapers first-ever property special in our September 8 edition.
James Knowles, features writer, Drapers