■ Rental growth across central London continued in 2014 on the back of robust occupier demand and availability constraints.

■ For example, 24 international retailers opened their first UK stores in London last year with a further 15 in the pipeline. This was marginally down on the 29 that opened stores in 2013, however, this was a reflection of lack of supply rather than diminished demand.

■ While Regent Street and Covent Garden lead in terms of total new entrants since 2012, Westfield Stratford was the top destination for new international brands this year. No doubt its greater leasing opportunities helped to push it up the ranking with American Eagle and Inditex's Stradivarius opening their first UK stores in the centre.

■ This demand from new international entrants and existing occupiers, means that Zone A rents reported a 7.2% increase in 2014.

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■ This is marginally down on the 9.3% reported for 2013 but is being restrained by availability constraints.

■ For example, the dearth of availability on Bond Street, particularly on prime segments of Old Bond Street, is restricting any market shifts in Zone A rents despite strong occupational demand. As a result prime Zone A rents have grown by only 4.0% over 2014 to £1,300 per sq ft.

■ In contrast those areas that have offered greater leasing opportunities have reported more significant uplifts in rents. These include Dover Street, Conduit Street and James Street (Covent Garden) who have seen Zone A increases of 57.1%, 38.9% and 25.0% respectively in 2014.

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■ Some of this uplift reflects growth off a relatively low base. However, it has been the influx of luxury brands onto these streets that has been the real driver of rental growth.

Taken from
Spotlight: Central London Retail - Q1 2015